Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

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<p>This week in StubWorld ...</p>
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<p>A change of pace with two infrequently discussed stubs in unwind territory:<br><a href="https://www.smartkarma.com/entities/jafco-co-ltd" target="_blank" data-smartkarma-citation="entities:8848:1" rel="noopener"></a></p>
<p><a href="https://www.smartkarma.com/entities/jafco-co-ltd" target="_blank" data-smartkarma-citation="entities:8848:1" rel="noopener"></a><a href="https://www.smartkarma.com/entities/news-corp-class-b" target="_blank" data-smartkarma-citation="entities:5990:1" rel="noopener">News Corp (NWSA US)</a><a href="https://www.smartkarma.com/entities/jafco-co-ltd" target="_blank" data-smartkarma-citation="entities:8848:1" rel="noopener">  / </a><a href="https://www.smartkarma.com/entities/rea-group-ltd" target="_blank" data-smartkarma-citation="entities:699:1" rel="noopener">REA Group Ltd (REA AU)</a>, and<br><a href="https://www.smartkarma.com/entities/jafco-co-ltd" target="_blank" data-smartkarma-citation="entities:8848:1" rel="noopener">Jafco Co Ltd (8595 JP)</a> / <a href="https://www.smartkarma.com/entities/nomura-research-institute-ltd" target="_blank" data-smartkarma-citation="entities:18129:1" rel="noopener">Nomura Research Institute Ltd (4307 JP)</a>.</p>
<p><em>and ...</em></p>
<p>two lesser-known stubs in set-up territory:<br><br><a href="https://www.smartkarma.com/entities/iljin-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:11265:1" rel="noopener">Iljin Holdings (015860 KS)</a> / <a href="https://www.smartkarma.com/entities/iljin-electric-co-ltd" target="_blank" data-smartkarma-citation="entities:4098:1" rel="noopener">Iljin Electric (103590 KS)</a>, and<br><a href="https://www.smartkarma.com/entities/sakata-inx-corp" target="_blank" data-smartkarma-citation="entities:19446:1" rel="noopener">Sakata Inx Corp (4633 JP)</a>  / <a href="https://www.smartkarma.com/entities/siix-corp" target="_blank" data-smartkarma-citation="entities:13244:1" rel="noopener">Siix Corp (7613 JP)</a>.</p>
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<p>Preceding my comments on these holding company relationships<a href="https://www.smartkarma.com/entities/pccw-ltd" target="_blank" data-smartkarma-citation="entities:873:1" rel="noopener"></a> are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
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<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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<p>As always, more below the fold.</p>
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This week in StubWorld ...



A change of pace with two infrequently discussed stubs in unwind territory: 
News Corp (NWSA US)  / REA Group Ltd (REA AU), and Jafco Co Ltd (8595 JP) / Nomura Research Institute Ltd (4307 JP).
and ...
two lesser-known stubs in set-up territory:  Iljin Holdings (015860 KS) / Iljin Electric (103590 KS), and Sakata Inx Corp (4633 JP)  / Siix Corp (7613 JP).



Preceding my comments on these holding company relationships are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


As always, more below the fold.


StubWorld: News Corp/REA Group, Jafco/Nomura Research, Iljin Holdings/Iljin Electric, Sakata/SIIX

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

MSCI Emerging Markets Index / Technical Analysis

<p style="text-align: justify;">Emerging markets (EEM-US) are breaking above major $46.30 resistance to hit highs not seen since June 2018. Additionally, RS on EEM-US is near 1-year highs -- a positive risk-on signal. Stocks doing business in <strong>China, India, Taiwan</strong>, and <strong>South Korea </strong>continue to be a major focus when it comes to individual stock recommendations.</p>

Emerging markets (EEM-US) are breaking above major $46.30 resistance to hit highs not seen since June 2018. Additionally, RS on EEM-US is near 1-year highs -- a positive risk-on signal. Stocks doing business in China, India, Taiwan, and South Korea continue to be a major focus when it comes to individual stock recommendations.

<p>We continue to be encouraged by market dynamics that are supportive of an ongoing equity bull market. Additionally, there continues to be an absence of breakdowns on the major global indexes (MSCI ACWI, ACWI ex-US, EM, &amp; EAFE). As a result, our outlook remains bullish.  In this report we show some love to various Sectors that have not been big attention-grabbers for us in recent months, but still have plenty of attractive stocks. The stocks highlighted hail from a variety of countries. Sectors covered include <strong>Services, Communications, Staples, Financials, and Utilities</strong>.</p>

We continue to be encouraged by market dynamics that are supportive of an ongoing equity bull market. Additionally, there continues to be an absence of breakdowns on the major global indexes (MSCI ACWI, ACWI ex-US, EM, &amp; EAFE). As a result, our outlook remains bullish.  In this report we show some love to various Sectors that have not been big attention-grabbers for us in recent months, but still have plenty of attractive stocks. The stocks highlighted hail from a variety of countries. Sectors covered include Services, Communications, Staples, Financials, and Utilities.

Global Equity Strategy: Market Dynamics Remain Positive, And So Are We

<p>The MSCI ACWI index (USD) is breaking out to all-time highs while the MSCI EM index (local) is breaking above its prior highs from January. This is bullish and will continue to be as long as there is an absence of breakdowns. On the other hand, Europe’s <strong>EURO STOXX 50</strong> and Japan’s <strong>TOPIX </strong>have struggled to break above resistance and their RS remains near the lows -- be selective. In addition to covering important technical levels across all markets, we highlight additional ideas in the following Sectors: <strong>Services, Communications, Industrials, </strong>and <strong>Transportation.</strong></p>

The MSCI ACWI index (USD) is breaking out to all-time highs while the MSCI EM index (local) is breaking above its prior highs from January. This is bullish and will continue to be as long as there is an absence of breakdowns. On the other hand, Europe’s EURO STOXX 50 and Japan’s TOPIX have struggled to break above resistance and their RS remains near the lows -- be selective. In addition to covering important technical levels across all markets, we highlight additional ideas in the following Sectors: Services, Communications, Industrials, and Transportation.

Global Equity Strategy: Bullish Outlook Intact

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/ke-holdings-inc" target="_blank" data-smartkarma-citation="entities:29213:1" rel="noopener">KE Holdings Inc (BEKE US)</a> is a combination of <em>Lianjia</em>, China's leading real estate brokerage brand, and <em>Beike</em>, China's leading integrated online and offline platform for housing transactions. KE has launched its IPO at a price range of $17-19 per ADS. At the mid-point of the IPO price range, KE will raise net proceeds of $1,841 million.</p></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/ke-holdings-beike-ipo-initiation-home-truths" target="_blank" rel="noopener">our initiation note</a>, we stated that our analysis suggests that if you consider the 1Q20 performance as a one-off (supported by the strong recovery in 2Q20), KE's financial performance is heading in the right direction with strong revenue growth and rising margins. In our <a href="https://www.smartkarma.com/insights/ke-holdings-beike-ipo-updated-filings-point-to-a-v-shaped-recovery" target="_blank" rel="noopener">follow-on note</a> which examined the 1H20 results, we stated that the 1H20 results showed a strong recovery across all financial metrics. We concluded that KE has attractive fundamentals. Overall, we think that a reasonable valuation and solid indication of interest from investors makes KE tempting at the proposed pricing range. </p></div></div></div>

KE Holdings Inc (BEKE US) is a combination of Lianjia, China's leading real estate brokerage brand, and Beike, China's leading integrated online and offline platform for housing transactions. KE has launched its IPO at a price range of $17-19 per ADS. At the mid-point of the IPO price range, KE will raise net proceeds of $1,841 million.In our initiation note, we stated that our analysis suggests that if you consider the 1Q20 performance as a one-off (supported by the strong recovery in 2Q20), KE's financial performance is heading in the right direction with strong revenue growth and rising margins. In our follow-on note which examined the 1H20 results, we stated that the 1H20 results showed a strong recovery across all financial metrics. We concluded that KE has attractive fundamentals. Overall, we think that a reasonable valuation and solid indication of interest from investors makes KE tempting at the proposed pricing range. 

KE Holdings (Beike) IPO: Valuation Insights

Australia

REA Group Limited provides online property listings, web development and internet related technology services to the real estate industry along with providing advertising services to Australian companies.  The Company also offers online real estate search services to the Australian public.

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REA Group Ltd (REA AU)

StubWorld: News Corp/REA Group, Jafco/Nomura Research, Iljin Holdings/Iljin Electric, Sakata/SIIX

Looking at consensus numbers, the majority of forward growth is coming from REA, not the stub ops. From a NAV viewpoint, News Corp is trading rich....

David Blennerhassett

Emerging Markets Breaking Out

Emerging markets (EEM-US) are breaking above major $46.30 resistance to hit highs not seen since June 2018. Additionally, RS on EEM-US is near 1...

Vermilion Research

Global Equity Strategy: Market Dynamics Remain Positive, And So Are We

We show some love to various Sectors that have not been big attention-grabbers for us in recent months, including Services, Communications,...

Vermilion Research

Global Equity Strategy: Bullish Outlook Intact

The MSCI ACWI index (USD) is breaking out to all-time highs while the MSCI EM index (local) is breaking above its prior highs from January. This is...

Vermilion Research

KE Holdings (Beike) IPO: Valuation Insights

KE Holdings Inc (BEKE US) is a combination of Lianjia, China's leading real estate brokerage brand, and Beike, China's leading integrated online...

Arun George

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