Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

<ul>
<li>On 22 January, HMM Co., Ltd. (011200 KS) announced its new Corporate Value Up plan which included five major items.</li>
<li>They include higher shareholder returns, achieve average sales growth of 9% and ROE of 4% in the next three years, and improve communication with stakeholders and shareholders.</li>
<li><em><strong>The company plans to implement total shareholder returns of at least 2.5 trillion won within one year, which represents 14.8% of its market cap. </strong></em></li>
</ul>


On 22 January, HMM Co., Ltd. (011200 KS) announced its new Corporate Value Up plan which included five major items.
They include higher shareholder returns, achieve average sales growth of 9% and ROE of 4% in the next three years, and improve communication with stakeholders and shareholders.
The company plans to implement total shareholder returns of at least 2.5 trillion won within one year, which represents 14.8% of its market cap. 


HMM: Material Improvement in Corporate Value Up Plan

Event-Driven

<ul>
<li>A consortium led by the Harim Group and JKL Partners has been chosen as the preferred bidder to acquire a 57.9% stake in HMM.</li>
<li>Korea Development Bank (KDB) and the Korea Ocean Business Corporation (KOBC) are the main creditors of HMM, which is the largest shipping company in Korea.</li>
<li>Pan Ocean is expected to complete a rights offering of nearly 3 trillion won which is 136% of its current market cap. This is excessive and negative for Pan Ocean.</li>
</ul>


A consortium led by the Harim Group and JKL Partners has been chosen as the preferred bidder to acquire a 57.9% stake in HMM.
Korea Development Bank (KDB) and the Korea Ocean Business Corporation (KOBC) are the main creditors of HMM, which is the largest shipping company in Korea.
Pan Ocean is expected to complete a rights offering of nearly 3 trillion won which is 136% of its current market cap. This is excessive and negative for Pan Ocean.


Pan Ocean Considering on a Rights Offering Capital Raise of Nearly 3 Trillion Won for the HMM Deal

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>Futures backwardation resulting from the short selling ban will persist. Also, the contraction of market making will lead to more widespread and frequent occurrences of extreme spreads.</li>
<li>The straightforward sell arbitrage (reverse cash and carry) is no longer viable. We must pay attention to the emergence of new price and trading patterns driven by these market conditions.</li>
<li>One potential pattern is the possibility of spot buying centered around those that exhibited extreme spreads at expiration. This has already been observed to some extent in this month's expiration.</li>
</ul>


Futures backwardation resulting from the short selling ban will persist. Also, the contraction of market making will lead to more widespread and frequent occurrences of extreme spreads.
The straightforward sell arbitrage (reverse cash and carry) is no longer viable. We must pay attention to the emergence of new price and trading patterns driven by these market conditions.
One potential pattern is the possibility of spot buying centered around those that exhibited extreme spreads at expiration. This has already been observed to some extent in this month's expiration.


Understanding Extreme SSF Spreads in Korea & Trading Approaches

<ul>
<li>In this insight, we discuss near-term momentum trading opportunities among the top 50 stocks in KOSPI with highest short interest ratios.</li>
<li>Given the recent temporary ban on stock short selling in Korea, there is likely to be increased volatility in the stock market. </li>
<li>We have identified 10 companies in particular that have high short interest ratios, among the worst performing stocks YTD, but with strongest share price performance in the past two days.</li>
</ul>


In this insight, we discuss near-term momentum trading opportunities among the top 50 stocks in KOSPI with highest short interest ratios.
Given the recent temporary ban on stock short selling in Korea, there is likely to be increased volatility in the stock market. 
We have identified 10 companies in particular that have high short interest ratios, among the worst performing stocks YTD, but with strongest share price performance in the past two days.


Momentum Trading Opportunities Among Top 50 Stocks in KOSPI With Highest Short Interest Ratios

<ul>
<li>On 17 October, Pan Ocean (028670 KS) announced that it will sell its 3.9 million shares (5.85% stake) in Hanjin KAL Corp (180640 KS) for about 163 billion won. </li>
<li>The main purpose of this stake sale is to secure more funds for Pan Ocean to potentially acquire HMM Co., Ltd. (011200 KS). </li>
<li>As evidenced by the recent increase in Baltic Dry Index, the potential expansion of the war in Israel could benefit major bulk shipping companies such as Pan Ocean.</li>
</ul>


On 17 October, Pan Ocean (028670 KS) announced that it will sell its 3.9 million shares (5.85% stake) in Hanjin KAL Corp (180640 KS) for about 163 billion won. 
The main purpose of this stake sale is to secure more funds for Pan Ocean to potentially acquire HMM Co., Ltd. (011200 KS). 
As evidenced by the recent increase in Baltic Dry Index, the potential expansion of the war in Israel could benefit major bulk shipping companies such as Pan Ocean.


Pan Ocean To Sell 5.8% Stake in Hanjin Kal To Secure Funds to Acquire HMM

South Korea

Pan Ocean Co., Ltd. is a Korean shipping company that engages in marine transportation business. The Company provides bulk cargo carrier, pure car and truck carrier, container and tanker services.

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Pan Ocean (028670 KS)

HMM: Material Improvement in Corporate Value Up Plan

HMM plans to implement total shareholder returns of at least 2.5 trillion won within one year, which represents 14.8% of its market cap.

Douglas Kim

Pan Ocean Considering on a Rights Offering Capital Raise of Nearly 3 Trillion Won for the HMM Deal

In order to pay for the HMM deal, Pan Ocean is expected to complete a rights offering capital raise of nearly 3 trillion won in 1H 2024 which is...

Douglas Kim

Understanding Extreme SSF Spreads in Korea & Trading Approaches

This post offers insights into the currently observed extreme spreads in the Korean single stock futures market and explores practical trading...

Sanghyun Park

Momentum Trading Opportunities Among Top 50 Stocks in KOSPI With Highest Short Interest Ratios

We have identified 10 companies in KOSPI that have high short interest ratios, among the worst performing stocks YTD, but with strongest share...

Douglas Kim

Pan Ocean To Sell 5.8% Stake in Hanjin Kal To Secure Funds to Acquire HMM

Pan Ocean plans to sell stake in Hanjin KAL to raise funds for potential acquisition of HMM Co. The outbreak of a war in Israel has resulted in...

Douglas Kim

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

HMM: Material Improvement in Corporate Value Up Plan

HMM plans to implement total shareholder returns of at least 2.5 trillion won within one year, which represents 14.8% of its market cap.

Douglas Kim

Pan Ocean Considering on a Rights Offering Capital Raise of Nearly 3 Trillion Won for the HMM Deal

In order to pay for the HMM deal, Pan Ocean is expected to complete a rights offering capital raise of nearly 3 trillion won in 1H 2024 which is...

Douglas Kim

Understanding Extreme SSF Spreads in Korea & Trading Approaches

This post offers insights into the currently observed extreme spreads in the Korean single stock futures market and explores practical trading...

Sanghyun Park

Momentum Trading Opportunities Among Top 50 Stocks in KOSPI With Highest Short Interest Ratios

We have identified 10 companies in KOSPI that have high short interest ratios, among the worst performing stocks YTD, but with strongest share...

Douglas Kim

Pan Ocean To Sell 5.8% Stake in Hanjin Kal To Secure Funds to Acquire HMM

​Pan Ocean plans to sell stake in Hanjin KAL to raise funds for potential acquisition of HMM Co. The outbreak of a war in Israel has resulted in...

Douglas Kim

Pan Ocean plans to sell stake in Hanjin KAL to raise funds for potential acquisition of HMM Co. The outbreak of a war in Israel has resulted in...