Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Event-Driven

<ul>
<li>On 16 April, Megastudyedu Co, Ltd. (215200 KS) announced a major shareholder return plan, driving up its share price by 14.2% to 60,400 won. </li>
<li>Driven by this attractive shareholder return plan combined with improving fundamentals, we believe that Megastudy Education's shares could continue to outperform the market in the next several months. </li>
<li>The total shareholder returns including share buybacks/cancellation and dividends are 60% of the company's non-consolidated net profit from 2024 to 2026.</li>
</ul>


On 16 April, Megastudyedu Co, Ltd. (215200 KS) announced a major shareholder return plan, driving up its share price by 14.2% to 60,400 won. 
Driven by this attractive shareholder return plan combined with improving fundamentals, we believe that Megastudy Education's shares could continue to outperform the market in the next several months. 
The total shareholder returns including share buybacks/cancellation and dividends are 60% of the company's non-consolidated net profit from 2024 to 2026.


Megastudy Education: A Major Shareholder Return Policy in 2024-2026

Equity Capital Markets

<ul>
<li>Our valuation analysis suggests a base case implied market cap of 567 billion won or implied price per share of 41,450 won.</li>
<li>This suggests a 3% upside to the high end of the IPO price range. We would not subscribe to this IPO due to lack of upside.</li>
<li>Our base case valuation is based on P/E of 18.8x using the company's net profit of 30.2 billion won in 2023.</li>
</ul>


Our valuation analysis suggests a base case implied market cap of 567 billion won or implied price per share of 41,450 won.
This suggests a 3% upside to the high end of the IPO price range. We would not subscribe to this IPO due to lack of upside.
Our base case valuation is based on P/E of 18.8x using the company's net profit of 30.2 billion won in 2023.


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.

<ul>
<li>The reshuffle results align with expectations, but the decision to list 11 KOSDAQ Global stocks in April is surprising. Local authorities seem to prioritize boosting the derivatives market for liquidity.</li>
<li>Ecopro Materials' SSF listing, earlier than expected, attracts attention, potentially leading to an unusual basis pattern, coinciding with a major lockup release on May 17th.</li>
<li>We should also be wary of a pattern akin to last July's in KOSDAQ stocks. Spot prices of recent SSFs showed a pronounced short-term uptrend, especially in KOSDAQ, versus KOSPI.</li>
</ul>


The reshuffle results align with expectations, but the decision to list 11 KOSDAQ Global stocks in April is surprising. Local authorities seem to prioritize boosting the derivatives market for liquidity.
Ecopro Materials' SSF listing, earlier than expected, attracts attention, potentially leading to an unusual basis pattern, coinciding with a major lockup release on May 17th.
We should also be wary of a pattern akin to last July's in KOSDAQ stocks. Spot prices of recent SSFs showed a pronounced short-term uptrend, especially in KOSDAQ, versus KOSPI.


KRX's Official SSF/SSO Reshuffle Results: Trading Considerations

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

Quantitative Analysis

<ul>
<li>We analyzed the changes in short interest of KRX Stocks as of Jan 26th which has an aggregated short interest worth USD7.9bn.</li>
<li>We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases &amp; decreases in short value, short as multiple of ADT.</li>
<li>We highlight short interest changes in Posco Dx, Ecopro, Posco Holdings.</li>
</ul>


We analyzed the changes in short interest of KRX Stocks as of Jan 26th which has an aggregated short interest worth USD7.9bn.
We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases &amp; decreases in short value, short as multiple of ADT.
We highlight short interest changes in Posco Dx, Ecopro, Posco Holdings.


KRX Short Interest Weekly (Jan 26th): Posco Dx, Ecopro, Posco Holdings

Equity Bottom-Up

<ul>
<li>The Korean Department of Education announced on 5 January that Korea will start to adopt customized digital school textbooks starting 2025.</li>
<li>These 11 Korean stocks that are well positioned to capitalize on the digital textbooks are up on average 5.3% YTD, strongly outperforming KOSPI which is up 2.4% YTD.</li>
<li>Japan is implementing the adoption of digital textbooks in elementary, junior, and high schools starting in 2024, ahead of Korea.</li>
</ul>


The Korean Department of Education announced on 5 January that Korea will start to adopt customized digital school textbooks starting 2025.
These 11 Korean stocks that are well positioned to capitalize on the digital textbooks are up on average 5.3% YTD, strongly outperforming KOSPI which is up 2.4% YTD.
Japan is implementing the adoption of digital textbooks in elementary, junior, and high schools starting in 2024, ahead of Korea.


Adoption of Digital Textbooks (Korea in 2025 & Japan in 2024)

South Korea

MegaStudyEdu Co., Ltd. offers online and offline educational programs to middle and high school students.  The Company provides college entrance test preparatory courses, e-learning, and college admission advisory services.

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Megastudyedu Co, Ltd. (215200 KS)

Megastudy Education: A Major Shareholder Return Policy in 2024-2026

Megastudy Education announced a major shareholder return plan which includes share buybacks/cancellation and dividends are 60% of the company's non...

Douglas Kim

I-Scream Media IPO Valuation Analysis

Our base case valuation of I Scream Media is target price of 41,450 won which suggests a 3% upside to the high end of the IPO price range. We would...

Douglas Kim

KRX's Official SSF/SSO Reshuffle Results: Trading Considerations

As pointed out in this post, considering KOSDAQ additions as a long basket is suitable. However, stocks with high pre-reshuffle price appreciation...

Sanghyun Park

KRX Short Interest Weekly (Jan 26th): Posco Dx, Ecopro, Posco Holdings

We analyzed KRX short interest report for the past week and highlighted short interest changes in Posco Dx, Ecopro, Posco Holdings.

Ke Yan, CFA, FRM

Adoption of Digital Textbooks (Korea in 2025 & Japan in 2024)

Korea will start to adopt customized digital school textbooks starting 2025. Japan is implementing the adoption of digital textbooks in elementary,...

Douglas Kim

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