Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<ul>
<li>The ESOP's 3.5% stake will be released on January 27. Considering the extremely tight flow situation, this is by no means small. 3.48% is 20 times the recent ADTV.</li>
<li>NPS will likely move toward a minimum stake of 6% again for LG Energy, irrespective of LG Energy's current valuation, despite its recent selling.</li>
<li>We should consider the possibility that NPS will contrarily utilize this ESOP lockup release, and we should also design a contrarian position for this lockup release.</li>
</ul>


The ESOP's 3.5% stake will be released on January 27. Considering the extremely tight flow situation, this is by no means small. 3.48% is 20 times the recent ADTV.
NPS will likely move toward a minimum stake of 6% again for LG Energy, irrespective of LG Energy's current valuation, despite its recent selling.
We should consider the possibility that NPS will contrarily utilize this ESOP lockup release, and we should also design a contrarian position for this lockup release.


LG Energy: ESOP Lockup Release (3.5% of SO) & Contrarian Approach Targeting NPS

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/vinfast" target="_blank" data-smartkarma-citation="entities:36550:1" rel="noopener">VinFast (1905332D VN)</a>  is looking to raise up to US$1bn in its upcoming US IPO.</li>
<li>VinFast is a full-scale mobility platform focused primarily on designing and manufacturing premium EVs, electric scooters and electric buses.</li>
<li>In this note, we talk about the not-so-positive aspects of the deal.</li>
</ul>



VinFast (1905332D VN)  is looking to raise up to US$1bn in its upcoming US IPO.
VinFast is a full-scale mobility platform focused primarily on designing and manufacturing premium EVs, electric scooters and electric buses.
In this note, we talk about the not-so-positive aspects of the deal.


VinFast Auto Pre-IPO - The Negatives - ... But Starting Low

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Cross Asset Strategy

<ul>
<li>In this insight, we provide a back-testing of the end of mandatory lock-up periods data from Korea Securities Depository (KSD) in the past six months.</li>
<li>Our back-testing suggests a 67% probability of the average share price performances of the top 3 market cap companies in each month data underperforming relative to KOSPI (10/15 time periods).</li>
<li>Among these stocks, some of the big underperformers included Wemade Co., Ltd. (112040 KS), Sebitchem (107600 KS), and Iljin Hysolus (271940 KS).</li>
</ul>


In this insight, we provide a back-testing of the end of mandatory lock-up periods data from Korea Securities Depository (KSD) in the past six months.
Our back-testing suggests a 67% probability of the average share price performances of the top 3 market cap companies in each month data underperforming relative to KOSPI (10/15 time periods).
Among these stocks, some of the big underperformers included Wemade Co., Ltd. (112040 KS), Sebitchem (107600 KS), and Iljin Hysolus (271940 KS).


Back-Testing End of Mandatory Lock-Up Periods Data from Korea Securities Depository in 2H 2022

<ul>
<li>We should set the minimum level of the target size to estimate the flow impact on T-1 Effective at ₩15T from ETFs.</li>
<li>We then need to pay attention to the recent trend that an additional flow from NPS appears post-Effective, with a significant portion on T+1~3.</li>
<li>We should revise down our expected rate of return on our early-phase setup aiming at the preemptive trading (T-6W Effective) by NPS.</li>
</ul>


We should set the minimum level of the target size to estimate the flow impact on T-1 Effective at ₩15T from ETFs.
We then need to pay attention to the recent trend that an additional flow from NPS appears post-Effective, with a significant portion on T+1~3.
We should revise down our expected rate of return on our early-phase setup aiming at the preemptive trading (T-6W Effective) by NPS.


KOSPI 200 Passive Flow Breakdown, Feat. NPS Size & Trade Window Pattern

<ul>
<li>
 Kakao managed to stay out of the relegation zone. Instead, Kia was pushed to the borderline. But POSCO failed to up its float rate, so Kia stayed in.</li>
<li>Besides that, LG Energy Solution and Celltrion made it to the index, replacing KB Financial and Shinhan Financial.</li>
<li>These passive flows appears to be of sufficient magnitude to cause a substantial price impact on T-1 Effectiveness. But it should also be approached with a fairly short window.</li>
</ul>



 Kakao managed to stay out of the relegation zone. Instead, Kia was pushed to the borderline. But POSCO failed to up its float rate, so Kia stayed in.
Besides that, LG Energy Solution and Celltrion made it to the index, replacing KB Financial and Shinhan Financial.
These passive flows appears to be of sufficient magnitude to cause a substantial price impact on T-1 Effectiveness. But it should also be approached with a fairly short window.


TIGER Top 10 Rebalancing: Four Names to Trade on T-1 Effective

South Korea

LG Energy Solution produces and sells batteries. The Company manufactures and sells automobile batteries, small batteries, energy storage system batteries, and other products. LG Energy Solution markets its products worldwide.

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LG Energy Solution (373220 KS)

LG Energy: ESOP Lockup Release (3.5% of SO) & Contrarian Approach Targeting NPS

This post details LG Energy's ESOP lockup release event scheduled for January 27 and discusses the contrarian trading approach targeting NPS.

Sanghyun Park

VinFast Auto Pre-IPO - The Negatives - ... But Starting Low

VinFast is looking to raise up to US$1bn in its upcoming US IPO. In this note, we talk about the not-so-positive aspects of the deal.

Sumeet Singh

Back-Testing End of Mandatory Lock-Up Periods Data from Korea Securities Depository in 2H 2022

In this insight, we provide a back-testing of the end of mandatory lock-up periods data from Korea Securities Depository (KSD) in the past six months.

Douglas Kim

KOSPI 200 Passive Flow Breakdown, Feat. NPS Size & Trade Window Pattern

This post breaks down the local institutional flow size tracking the KOSPI 200 and investigates how NPS contributes to this picture by looking at...

Sanghyun Park

TIGER Top 10 Rebalancing: Four Names to Trade on T-1 Effective

This post screens four names to trade at the TIGER Top 10 ETF rebalancing in December based on FnGuide's latest float rates, and discusses trading...

Sanghyun Park

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