Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Event-Driven

<ul>
<li>We discuss the potential additions and deletions in the upcoming June 2022 KOSPI200 rebalance. The outbreak of war in Ukraine has impacted the potential additions/deletion candidates. </li>
<li>These top 10 potential inclusions are up on average 10.8% YTD, outperforming KOSPI which is down 9.1% YTD.</li>
<li>Among the potential inclusions, Ildong Pharm, Meritz F&amp;M Insurance, Hana Tour, Dongwon Systems, and Lotte Rental have been materially outperforming the market in the past three months. </li>
</ul>


We discuss the potential additions and deletions in the upcoming June 2022 KOSPI200 rebalance. The outbreak of war in Ukraine has impacted the potential additions/deletion candidates. 
These top 10 potential inclusions are up on average 10.8% YTD, outperforming KOSPI which is down 9.1% YTD.
Among the potential inclusions, Ildong Pharm, Meritz F&amp;M Insurance, Hana Tour, Dongwon Systems, and Lotte Rental have been materially outperforming the market in the past three months. 


KOSPI 200 Rebalance in June 2022 Amid Portfolio Changes Post Outbreak of War in Ukraine

<ul>
<li>In this insight, we discuss the potential additions and deletions in the upcoming June 2022 KOSPI200 rebalance.</li>
<li>These top 10potential inclusionsare down on average 4.4% YTD, outperforming KOSPI which is down 10.1% YTD.</li>
<li>These top 10 potential exclusions are down on average 12.3% YTD, underperforming KOSPI which is down 10.1% YTD.</li>
</ul>


In this insight, we discuss the potential additions and deletions in the upcoming June 2022 KOSPI200 rebalance.
These top 10potential inclusionsare down on average 4.4% YTD, outperforming KOSPI which is down 10.1% YTD.
These top 10 potential exclusions are down on average 12.3% YTD, underperforming KOSPI which is down 10.1% YTD.


Initial Thoughts on the KOSPI200 Rebalance in June 2022

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 screening results based on the average market cap for the screening period until the last closing price have seven additions/deletions.</li>
<li>LG Energy will make Fast Entry. The one to make room for LG Energy should be Dongwon F&amp;B, an additional deletion to the seven deletions through the preliminary filtering.</li>
<li>F&amp;F Holdings may fail to meet the minimum float rate. If it doesn't make KOSPI 200 this time, Hyundai Marine &amp; Fire Insurance will get to stay in the Index.</li>
</ul>


The screening results based on the average market cap for the screening period until the last closing price have seven additions/deletions.
LG Energy will make Fast Entry. The one to make room for LG Energy should be Dongwon F&amp;B, an additional deletion to the seven deletions through the preliminary filtering.
F&amp;F Holdings may fail to meet the minimum float rate. If it doesn't make KOSPI 200 this time, Hyundai Marine &amp; Fire Insurance will get to stay in the Index.


KOSPI 200 Rebalancing Screening: Prediction Likelihood, Special Issues, & Passive Impacts

Strong earnings stocks can protect investors against inflation risk.So, I examined the first-quarter operating profits of all the KOSPI stocks and by how far they beat the local street consensus (compiled by FnGuide).For this, I used the following filters:
1Q21 operating profit beat the local market consensus by 10% or higher.
1Q21 operating profit exceeded ₩50B.
1Q21 operating profit increased year over year.
A total of 59 KOSPI stocks satisfy these filters, as shown below, which potentially serve as an inflation-hedged stock for a basket trade.









Name
Ticker
1Q21 operating profit
1Q21 consensus operating profit
Earnings surprise as a % of consensus


KB Financial Group Inc
105560
₩1,747.2B
₩1,450.5B
20.46%


Shinhan Financial Group Co., Ltd.
055550
₩1,682.4B
₩1,477.7B
13.85%


POSCO
005490
₩1,552.4B
₩1,286.8B
20.64%


LG Electronics Inc.
066570
₩1,516.6B
₩1,202.6B
26.11%


LG Chem Ltd
051910
₩1,408.1B
₩1,009.6B
39.47%


Samsung Life Insurance co., Ltd
032830
₩1,334.4B
₩858.8B
55.38%


Hana Financial Group Inc
086790
₩1,075.8B
₩967.3B
11.21%


LG Corp
003550
₩1,000.9B
₩704.0B
42.17%


Woori Financial Group Inc
316140
₩933.3B
₩803.4B
16.17%


Hanwha Corp
000880
₩848.5B
₩365.7B
131.99%


Industrial Bank of Korea
024110
₩780.3B
₩636.7B
22.56%


GS Holdings Corp
078930
₩706.4B
₩483.3B
46.17%


S Oil Corp
010950
₩629.2B
₩340.9B
84.60%


Lotte Chemical Corp
011170
₩623.8B
₩494.7B
26.10%


Kumho Petro Chemical Co Ltd
011780
₩612.5B
₩445.3B
37.56%


Hyundai Heavy Industries Holdings Co Ltd
267250
₩534.3B
₩300.7B
77.69%


SK Innovation Co Ltd
096770
₩502.5B
₩378.2B
32.87%


KT Corp
030200
₩444.2B
₩386.9B
14.80%


Samsung Securities Co Ltd
016360
₩399.4B
₩338.8B
17.87%


SK Telecom Co Ltd
017670
₩388.8B
₩345.8B
12.44%


CJ Cheiljedang Corp
097950
₩385.1B
₩327.5B
17.58%


NH Investment &amp; Securities Co Ltd
005940
₩374.4B
₩300.0B
24.82%


Hyundai Steel Co
004020
₩303.9B
₩174.8B
73.88%


Samsung C&amp;T Corp
028260
₩302.6B
₩231.6B
30.67%


Doosan Infracore Co Ltd
042670
₩295.4B
₩242.0B
22.04%


MERITZ SECURITIES CO LTD
008560
₩284.7B
₩221.0B
28.80%


LG Uplus Corp
032640
₩275.6B
₩237.5B
16.05%


Hanwha Solutions Corp
009830
₩254.6B
₩229.1B
11.12%


Hyosung TNC Corp
298020
₩246.8B
₩185.5B
33.05%


Daewoo Engineering &amp; Construction Co Ltd
047040
₩229.4B
₩150.1B
52.79%


Samsung SDS Co Ltd
018260
₩217.1B
₩194.7B
11.50%


Hyundai Engineering &amp; Construction Co.
000720
₩200.9B
₩171.3B
17.30%


DL E&amp;C Ord Shs
375500
₩199.8B
₩154.5B
29.29%


Amorepacific Group
002790
₩197.7B
₩146.3B
35.10%


Hankook Tire &amp; Technology Co Ltd
161390
₩186.0B
₩166.4B
11.82%


Samsung Card Co Ltd
029780
₩185.3B
₩149.9B
23.60%


DGB Financial Group Co Ltd
139130
₩178.4B
₩159.9B
11.58%


JB Financial Group Co Ltd
175330
₩177.8B
₩151.6B
17.35%


Amorepacific Corp
090430
₩176.2B
₩146.6B
20.20%


Doosan Bobcat Inc
241560
₩171.3B
₩120.3B
42.42%


Coway Co Ltd
021240
₩170.7B
₩150.0B
13.82%


Shinsegae Inc
004170
₩123.6B
₩89.2B
38.53%


E-Mart Inc
139480
₩123.2B
₩111.7B
10.30%


LG International Corp
001120
₩113.3B
₩69.7B
62.60%


Samsung Engineering Co Ltd
028050
₩107.3B
₩92.8B
15.62%


Hyosung Corp
004800
₩100.6B
₩70.0B
43.76%


Hyosung Advanced Materials Corp
298050
₩83.4B
₩62.6B
33.17%


Hyundai Construction Equipment Co Ltd
267270
₩79.7B
₩52.2B
52.83%


KCC Corp
002380
₩77.4B
₩53.0B
45.94%


SK Biopharmaceuticals Co Ltd
326030
₩75.9B
₩56.3B
34.87%


Mando Corp
204320
₩71.9B
₩63.4B
13.29%


F&amp;F Co., Ltd
007700
₩70.0B
₩33.7B
107.99%


Kolon Industries Inc
120110
₩69.1B
₩55.1B
25.40%


Dongwon Industries Co., Ltd
006040
₩68.1B
₩59.3B
14.91%


Hanwha Aerospace Co Ltd
012450
₩65.9B
₩34.4B
91.40%


Hyundai Department Store Co Ltd
069960
₩65.0B
₩57.9B
12.28%


POONGSAN CORPORATION
103140
₩62.4B
₩44.8B
39.35%


Hyosung Chemical Corp
298000
₩61.1B
₩48.9B
24.92%


KEPCO Plant Service &amp; Engineering Co Ltd
051600
₩56.4B
₩30.2B
86.94%

Source: KRX &amp; FnGuide



Earnings Surprise KOSPI Stocks Potentially Hedging Against Inflation for Basket & Pairs Trades

Thematic (Sector/Industry)

Don't forget that this year's ex-dividend date for the Korean companies whose fiscal year ends Dec 31 is Dec 27. This means you have to own (or buy) shares until Dec 26 (next Tuesday) to get dividends. Yes, this means it is again time to make a move on dividend arbitrage. Buy them in baskets and short the futures? Surely, we have various ways of doing arbitrage on high yield dividend stocks, but in this insight I will just take a look at individual stocks and I will leave specifics of arbitrage strategy up to you. That is, I will try to examine the most basic thing, price-dividend yield of each individual stock that I think worth our attention, and then compare it with the opening price of each individual stock on the ex-dividend day.<table class="table table-striped"><tbody><tr><td colspan="2" style="width: 731px;">Important dates for high yield dividend stock hunters in Korea for the companies whose FY ends Dec 31</td></tr><tr><td style="width: 403.7364196777344px;">Last day to buy high yield dividend stocks in 2017</td><td style="text-align: right; width: 327.2635803222656px;">Dec 26, 2017</td></tr><tr><td style="width: 403.7364196777344px;">Ex-dividend date in 2017</td><td style="text-align: right; width: 327.2635803222656px;">Dec 27, 2017</td></tr><tr><td colspan="2" style="text-align: right; width: 731px;"><hr></td></tr><tr><td style="width: 403.7364196777344px;">Last day to buy high yield dividend stocks in 2016</td><td style="text-align: right; width: 327.2635803222656px;">Dec 27, 2016</td></tr><tr><td style="width: 403.7364196777344px;">Ex-dividend date in 2016</td><td style="text-align: right; width: 327.2635803222656px;">Dec 28, 2016</td></tr><tr><td colspan="2" style="width: 731px;">Source: KRX</td></tr></tbody></table>

Don't forget that this year's ex-dividend date for the Korean companies whose fiscal year ends Dec 31 is Dec 27. This means you have to own (or buy) shares until Dec 26 (next Tuesday) to get dividends. Yes, this means it is again time to make a move on dividend arbitrage. Buy them in baskets and short the futures? Surely, we have various ways of doing arbitrage on high yield dividend stocks, but in this insight I will just take a look at individual stocks and I will leave specifics of arbitrage strategy up to you. That is, I will try to examine the most basic thing, price-dividend yield of each individual stock that I think worth our attention, and then compare it with the opening price of each individual stock on the ex-dividend day.Important dates for high yield dividend stock hunters in Korea for the companies whose FY ends Dec 31Last day to buy high yield dividend stocks in 2017Dec 26, 2017Ex-dividend date in 2017Dec 27, 2017Last day to buy high yield dividend stocks in 2016Dec 27, 2016Ex-dividend date in 2016Dec 28, 2016Source: KRX

Year-End Dividend Arbitrage - 5 High Conviction Stocks in KOSPI

South Korea

Meritz Fire & Marine Insurance Co., Ltd. provides a variety of non-life insurance services.  The Company's services include auto, fire, casualty, health, travel, leisure, retirement, and pension insurance.

Meritz Fire & Marine Insurance (000060 KS)

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Meritz Fire & Marine Insurance (000060 KS)

KOSPI 200 Rebalance in June 2022 Amid Portfolio Changes Post Outbreak of War in Ukraine

We discuss the potential additions and deletions in the upcoming June 2022 KOSPI200 rebalance. The outbreak of war in Ukraine has impacted the...

Douglas Kim

Initial Thoughts on the KOSPI200 Rebalance in June 2022

We discuss the potential additions and deletions in the upcoming June 2022 KOSPI200 rebalance. Top 10 potential inclusions are down on average 4.4%...

Douglas Kim

KOSPI 200 Rebalancing Screening: Prediction Likelihood, Special Issues, & Passive Impacts

This post has the screening results of the KOSPI 200 rebalancing, with a focus on prediction likelihood, special considerations, and passive impacts.

Sanghyun Park

Earnings Surprise KOSPI Stocks Potentially Hedging Against Inflation for Basket & Pairs Trades

This post finds the first-quarter earnings surprise stocks in KOSPI that potentially hedge against inflation for basket and pairs trades.

Sanghyun Park

Year-End Dividend Arbitrage - 5 High Conviction Stocks in KOSPI

Don't forget that this year's ex-dividend date for the Korean companies whose fiscal year ends Dec 31 is Dec 27. This means you have to own (or...

Sanghyun Park

Price Gauge

52-week Range

Market Cap (USDm)

P/E

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