Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Equity Bottom-Up

In mid-December, eight trading days after Vedanta promotor Anil Agarwal said the promoter (Vedanta Resources, himself, the associated companies) had no plans at all to increase their stake in <a href="https://www.smartkarma.com/entities/vedanta-ltd" target="_blank" data-smartkarma-citation="entities:514:1" rel="noopener">Vedanta Ltd (VEDL IN)</a> and no plans to make an Open Offer, the promoter launched a block bid to buy 4.98% in a post-market trade. The shares had climbed more than 50% in the previous two months to Rs 150/share, but the deal got done at Rs 160/share.Less than three weeks later, two entities controlled by <a href="https://www.smartkarma.com/entities/vedanta-resources-limited" target="_blank" data-smartkarma-citation="entities:22202:1" rel="noopener">Vedanta Resources (VED LN)</a> announced an intention to conduct an Open Offer to buy another 10% of its main Indian-listed asset, VEDL at the same Rs. 160/share price as the clearing price. But by that time (9 January), the price had risen past Rs. 180/share as global market movements had propelled gains in cyclicals and commodity markets had propelled the underlying products.But even then, VEDL was quite cheap on a relative basis. The question was about the nature of the Open Offer. Was it a real Open Offer?  Or was it designed for another purpose in mind? We still do not know the answer, but on 18 February the stock reached a new 2-year intraday high, closing at Rs. 195+/share. And VEDL is still not expensive vs peers. Q3 results at both HZ and at VEDL ex-HZ were great. VEDL ex-HZ Operating Income was the highest since March 2014, and VEDL ex-HZ Net Income in Q3 was the second highest non-accounting gimmick Net Income ever?Looking forward, consensus on VEDL is stale. It shows the largest negative number for VEDL ex-HZ OP in the modern VEDL era in Q4 this year despite strong commodity pricing.And VEDL still owes a lot of back dividends to its shareholders. And we await the Open Offer details.This and a lot more below.

In mid-December, eight trading days after Vedanta promotor Anil Agarwal said the promoter (Vedanta Resources, himself, the associated companies) had no plans at all to increase their stake in Vedanta Ltd (VEDL IN) and no plans to make an Open Offer, the promoter launched a block bid to buy 4.98% in a post-market trade. The shares had climbed more than 50% in the previous two months to Rs 150/share, but the deal got done at Rs 160/share.Less than three weeks later, two entities controlled by Vedanta Resources (VED LN) announced an intention to conduct an Open Offer to buy another 10% of its main Indian-listed asset, VEDL at the same Rs. 160/share price as the clearing price. But by that time (9 January), the price had risen past Rs. 180/share as global market movements had propelled gains in cyclicals and commodity markets had propelled the underlying products.But even then, VEDL was quite cheap on a relative basis. The question was about the nature of the Open Offer. Was it a real Open Offer?  Or was it designed for another purpose in mind? We still do not know the answer, but on 18 February the stock reached a new 2-year intraday high, closing at Rs. 195+/share. And VEDL is still not expensive vs peers. Q3 results at both HZ and at VEDL ex-HZ were great. VEDL ex-HZ Operating Income was the highest since March 2014, and VEDL ex-HZ Net Income in Q3 was the second highest non-accounting gimmick Net Income ever?Looking forward, consensus on VEDL is stale. It shows the largest negative number for VEDL ex-HZ OP in the modern VEDL era in Q4 this year despite strong commodity pricing.And VEDL still owes a lot of back dividends to its shareholders. And we await the Open Offer details.This and a lot more below.

Vedanta Soars Beyond Indicative Open Offer Level. Not Expensive

Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Event-Driven

Indian Aluminium manufacturer <a href="https://www.smartkarma.com/entities/national-aluminium-co-ltd" target="_blank" data-smartkarma-citation="entities:1770:1" rel="noopener">National Aluminium (NACL IN)</a> ("NALCO") informed the market on 21st January 2021 that they were <a href="https://www.bseindia.com/xml-data/corpfiling/AttachHis/D6D61779-CB52-4346-8C8F-78C23F1EEE3F-162006.pdf" target="_blank" rel="noopener">considering a buyback</a> of shares. As planned, a week later on 27th January, the <a href="https://www.bseindia.com/xml-data/corpfiling/AttachHis/D6D61779-CB52-4346-8C8F-78C23F1EEE3F-162006.pdf" target="_blank" rel="noopener">board meeting</a> was held and the resolution to conduct a buyback offer was passed as required. On 29th January, NALCO made a <a href="https://www.sebi.gov.in/filings/buybacks/jan-2021/national-aluminium-company-limited-public-announcement_48946.html" target="_blank" rel="noopener">public announcement</a> confirming more details regarding this buyback. This will be the third buyback by NALCO in the last five years. This time, they are planning to buy up to 130,279,083 shares through a Tender Offer at a price of INR57.50/share. The size of this buyback is around INR7.5bn (~US$100mn). This is an interesting situation.More below the fold.

Indian Aluminium manufacturer National Aluminium (NACL IN) ("NALCO") informed the market on 21st January 2021 that they were considering a buyback of shares. As planned, a week later on 27th January, the board meeting was held and the resolution to conduct a buyback offer was passed as required. On 29th January, NALCO made a public announcement confirming more details regarding this buyback. This will be the third buyback by NALCO in the last five years. This time, they are planning to buy up to 130,279,083 shares through a Tender Offer at a price of INR57.50/share. The size of this buyback is around INR7.5bn (~US$100mn). This is an interesting situation.More below the fold. 

NALCO India Buyback Tender Offer: A Small Arb

David Blennerhassett

Last Week in Event SPACE: UNIZO, Maanshan, SK Holdings, Z Holdings, AVIC, TVB, HN Renewable, Webster

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Last evening, the ETF manager posted a notice on their website with details on which companies would be divested by the Government of India and the minimum shareholding that the Government would like to hold post the ETF issue.In this Insight, we look at the effective discount on the ETF at different issue sizes and the impact on some of the ETF constituents that will be bought from the market.<a href="https://www.smartkarma.com/entities/national-aluminium-co-ltd" target="_blank" data-smartkarma-citation="entities:1770:1" rel="noopener">National Aluminium (NACL IN)</a> is an interesting name for this ETF issue given the impact of the ETF manager buying shares in the market.

Last evening, the ETF manager posted a notice on their website with details on which companies would be divested by the Government of India and the minimum shareholding that the Government would like to hold post the ETF issue.In this Insight, we look at the effective discount on the ETF at different issue sizes and the impact on some of the ETF constituents that will be bought from the market.National Aluminium (NACL IN) is an interesting name for this ETF issue given the impact of the ETF manager buying shares in the market.

Bharat 22 ETF - Effective Discount Shrinks Substantially

Last Week in Event SPACE: ZOZO, New World Dev, Osram, Holcim/San Miguel, Bharat ETF, Doosan

India

National Aluminium Co. Ltd. is an integrated aluminum manufacturer. The Company mines for bauxite, refines bauxite into aluminum and manufactures and sells aluminum and aluminum products. National Aluminium Company's products include bauxite, aluminum hydrate, calcined aluminum, aluminum ingots and aluminum wire rods, as well as electricity which is generated for captive consumption.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

National Aluminium (NACL IN)

Vedanta Soars Beyond Indicative Open Offer Level. Not Expensive

VEDL is STILL cheap to peers relative, on a stub basis, on a fundamental basis using current or forward EV/consensus EBIT or EBITDA. We await the...

Travis Lundy

NALCO India Buyback Tender Offer: A Small Arb

NALCO has an interesting and large buyback in the form of a public tender offer. Minimum pro-ration for large shareholders is about 6.7% and there...

Janaghan Jeyakumar, CFA

Last Week in Event SPACE: UNIZO, Maanshan, SK Holdings, Z Holdings, AVIC, TVB, HN Renewable, Webster

Last Week in Event SPACE ... On a risk-reward basis on the Unizo Holdings (3258 JP) deal, if Ichigo, Elliott, and others do not step in, this may...

David Blennerhassett

Bharat 22 ETF - Effective Discount Shrinks Substantially

Last evening, the ETF manager posted a notice on their website with details on which companies would be divested by the Government of India and the...

Brian Freitas

Last Week in Event SPACE: ZOZO, New World Dev, Osram, Holcim/San Miguel, Bharat ETF, Doosan

Last Week in Event SPACE ... The combination of profitability and pro-ration grids, and your access to more granular trading strategies, will...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)