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 local ghost hedge fund began to excessively invest in credit, which leveraged 2.5 to 3 times when the eight manipulated stocks started to increase rapidly in price.</li>
<li>Then, the Financial Supervisory Service deemed this excessively-leveraged trading behavior as unusual, and news of an investigation into their activities broke out and triggered them to dump the shares.</li>
<li>The key now is identifying in advance the stocks that will experience similar selling patterns. To do so, we need to prioritize selecting stocks with high-margin balances in recent times.</li>
</ul>


The local ghost hedge fund began to excessively invest in credit, which leveraged 2.5 to 3 times when the eight manipulated stocks started to increase rapidly in price.
Then, the Financial Supervisory Service deemed this excessively-leveraged trading behavior as unusual, and news of an investigation into their activities broke out and triggered them to dump the shares.
The key now is identifying in advance the stocks that will experience similar selling patterns. To do so, we need to prioritize selecting stocks with high-margin balances in recent times.


Matched Order Fraud in Korea: Reason Behind Eight Stocks Hit Massively

Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/24384" target="_blank" data-smartkarma-citation="entities:24384:1">Datasolution (263800 KS)</a> is a micro cap (₩55bil market cap) company that is to be listed this week on Aug 3. It is <a href="https://www.smartkarma.com/entities/11657" target="_blank" data-smartkarma-citation="entities:11657:1">Openbase Inc (049480 KS)</a>'s wholly-owned subsidiary. Openbase acquired Datasolution in 2001. Datasolution was founded in 1990, and its corporate name was SPSS Korea since it began its business as a reseller of SPSS software. At the time it was acquired by Openbase in 2001, it changed its name to Datasolution. Since the acquisition, Datasolution has been managed/operated by Openbase executives. For instance, Datasolution's current CEO, Bae Bok-tae, is one of Openbase's three founders. In 2010, Openbase was split up into two business units through physical division. Basically, Openbase was divided into network solution unit and platform/service solution unit. The new entity that was spun off from Openbase was called "Open SNS", which was responsible for platform/service solution unit. Bae Bok-tae, Datasolution's current CEO, became the head of Open SNS. In 2016, Open SNS merged with Datasolution, and this merged entity kept the corporate name "Datasolution". At the time of merger, Open SNS was responsible for 80+% of the total sales of the merged entity, whereas the former Datasolution was responsible for less than 20%. </p><p>A majority of Datasolution's sales are still coming from its "not-so-exciting" businesses such as Dell EMC storage resale and SI (system integration) projects, both of which belonged to Open SNS. But Open SNS is focusing on big data analytics business and actually developed its own proprietary analytic solutions even though this big data thing isn't really making any meaningful contribution to its top line growth yet. <em><strong>Nonetheless, what is interesting is that Open SNS' big data analytics business is exactly why Datasolution is being viewed as a growth stock rather than a dull SI (system integration) company in this IPO.</strong></em></p><table class="table table-striped"><tbody><tr><td style="width: 212.6px;">Item</td><td style="width: 440.4px;">Detail</td></tr><tr><td style="width: 212.6px;">Company name</td><td style="width: 440.4px;"><p><a href="https://www.smartkarma.com/entities/24384" target="_blank" data-smartkarma-citation="entities:24384:1">Datasolution (263800 KS)</a></p></td></tr><tr><td style="width: 212.6px;">CEO</td><td style="width: 440.4px;">Bae Bok-tae</td></tr><tr><td style="width: 212.6px;">Established</td><td style="width: 440.4px;">1990</td></tr><tr><td style="width: 212.6px;">Business area</td><td style="width: 440.4px;"><p>Software development and consulting services</p></td></tr><tr><td style="width: 212.6px;">Address</td><td style="width: 440.4px;">Eonju 620 Intelrekseu modern bldg., Gangnam-gu, Seoul, South Korea</td></tr><tr><td style="width: 212.6px;">Phone number</td><td style="width: 440.4px;">+82 2-3467-7200</td></tr><tr><td style="width: 212.6px;">Company website</td><td style="width: 440.4px;"><a href="http://www.datasolution.kr/" target="_blank">www.datasolution.kr</a></td></tr><tr><td colspan="2" style="width: 653px;"><em>Source: Company website, Bloomberg</em></td></tr></tbody></table><table class="table table-striped"><tbody><tr><td style="width: 212.2px;">Major shareholder</td><td style="width: 217.8px;">Pre IPO shareholding %</td><td style="width: 225px;">Post IPO shareholding %</td></tr><tr><td style="width: 212.2px;"><a href="https://www.smartkarma.com/entities/11657" target="_blank" data-smartkarma-citation="entities:11657:1">Openbase Inc (049480 KS)</a></td><td style="width: 217.8px;">100.00%</td><td style="width: 225px;">69.20%</td></tr><tr><td colspan="3" style="width: 655px;"><em>Source: DART</em></td></tr></tbody></table><p><em>Alright, let's find out more about this IPO stock.</em></p>

Datasolution (263800 KS) is a micro cap (₩55bil market cap) company that is to be listed this week on Aug 3. It is Openbase Inc (049480 KS)'s wholly-owned subsidiary. Openbase acquired Datasolution in 2001. Datasolution was founded in 1990, and its corporate name was SPSS Korea since it began its business as a reseller of SPSS software. At the time it was acquired by Openbase in 2001, it changed its name to Datasolution. Since the acquisition, Datasolution has been managed/operated by Openbase executives. For instance, Datasolution's current CEO, Bae Bok-tae, is one of Openbase's three founders. In 2010, Openbase was split up into two business units through physical division. Basically, Openbase was divided into network solution unit and platform/service solution unit. The new entity that was spun off from Openbase was called "Open SNS", which was responsible for platform/service solution unit. Bae Bok-tae, Datasolution's current CEO, became the head of Open SNS. In 2016, Open SNS merged with Datasolution, and this merged entity kept the corporate name "Datasolution". At the time of merger, Open SNS was responsible for 80+% of the total sales of the merged entity, whereas the former Datasolution was responsible for less than 20%. A majority of Datasolution's sales are still coming from its "not-so-exciting" businesses such as Dell EMC storage resale and SI (system integration) projects, both of which belonged to Open SNS. But Open SNS is focusing on big data analytics business and actually developed its own proprietary analytic solutions even though this big data thing isn't really making any meaningful contribution to its top line growth yet. Nonetheless, what is interesting is that Open SNS' big data analytics business is exactly why Datasolution is being viewed as a growth stock rather than a dull SI (system integration) company in this IPO.ItemDetailCompany nameDatasolution (263800 KS)CEOBae Bok-taeEstablished1990Business areaSoftware development and consulting servicesAddressEonju 620 Intelrekseu modern bldg., Gangnam-gu, Seoul, South KoreaPhone number+82 2-3467-7200Company websitewww.datasolution.krSource: Company website, BloombergMajor shareholderPre IPO shareholding %Post IPO shareholding %Openbase Inc (049480 KS)100.00%69.20%Source: DARTAlright, let's find out more about this IPO stock.

Datasolution IPO Summary - Questions Remain on Growth, but Market Seems Excited

South Korea

Openbase Inc. imports and sells contents networking and storage solutions.  The Company also provides system integration (SI) service.  Openbase provides its merchandise to Internet Service providers, telecommunication companies, and financial companies.

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Openbase Inc (049480 KS)

Matched Order Fraud in Korea: Reason Behind Eight Stocks Hit Massively

This post investigates and explains the matched order fraud incident that engulfed Korea's local stock market this week and the potential names...

Sanghyun Park

Datasolution IPO Summary - Questions Remain on Growth, but Market Seems Excited

Datasolution (263800 KS) is a micro cap (₩55bil market cap) company that is to be listed this week on Aug 3. It is Openbase Inc (049480 KS)'s...

Sanghyun Park

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