Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Cross Asset Strategy

<ul>
<li>In this insight, we discuss the recent buying and selling by the Korea National Pension Service (NPS) of Korean stocks.</li>
<li>Of the 176 Korean stocks in which NPS reported changes in ownerships in 2Q 2022, NPS increased its stakes in 115 companies and reduced stakes in 61 companies.</li>
<li>NPS mostly increased stakes in aerospace, defense, construction equipment, and energy sectors while reducing stakes in telecom and tourism related stocks.</li>
</ul>


In this insight, we discuss the recent buying and selling by the Korea National Pension Service (NPS) of Korean stocks.
Of the 176 Korean stocks in which NPS reported changes in ownerships in 2Q 2022, NPS increased its stakes in 115 companies and reduced stakes in 61 companies.
NPS mostly increased stakes in aerospace, defense, construction equipment, and energy sectors while reducing stakes in telecom and tourism related stocks.


NPS Sells SK Bioscience, Naver, & LG Electronics and Buys Kakao Bank, Lotte Corp, & Samyang Foods

Private Capital Markets

Kakao Entertainment  / Private Capital Markets

<ul>
<li>Kakao Entertainment is one of the biggest entertainment companies in Korea. The company has a strong IP for webtoons, web novels, music, drama, movies, and other digital contents.</li>
<li>Kakao Entertainment is a company that was formed from a merger of Kakao Page and Kakao M in March 2021. </li>
<li>Kakao Corp (035720 KS) is the largest shareholder of Kakao Entertainment, followed by Anchor Equity Partners, and Tencent.</li>
</ul>


Kakao Entertainment is one of the biggest entertainment companies in Korea. The company has a strong IP for webtoons, web novels, music, drama, movies, and other digital contents.
Kakao Entertainment is a company that was formed from a merger of Kakao Page and Kakao M in March 2021. 
Kakao Corp (035720 KS) is the largest shareholder of Kakao Entertainment, followed by Anchor Equity Partners, and Tencent.


Kakao Entertainment: A Korean Entertainment Powerhouse

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>WISE Media Contents rebalances every quarter in January, April, July, and October. The effective date for the upcoming rebalancing is April 15.</li>
<li>The gap between the rebalancing weight change estimations based on the float-adjusted market caps and the actual implementation of the ETF operator (TIGER) is not significant.</li>
<li>Following stocks are worth paying attention: (Short) Jyp Entertainment, S.M.Entertainment, Studio Dragon, Jcontentree, and SBS Contents Hub / (Long) CJ ENM, DearU, D&amp;C Media, Genie Music, and IHQ</li>
</ul>


WISE Media Contents rebalances every quarter in January, April, July, and October. The effective date for the upcoming rebalancing is April 15.
The gap between the rebalancing weight change estimations based on the float-adjusted market caps and the actual implementation of the ETF operator (TIGER) is not significant.
Following stocks are worth paying attention: (Short) Jyp Entertainment, S.M.Entertainment, Studio Dragon, Jcontentree, and SBS Contents Hub / (Long) CJ ENM, DearU, D&amp;C Media, Genie Music, and IHQ


WISE Media Contents (TIGER ETF) Rebalancing Preview

<ul>
<li>In the past week, it was announced that Tving, a leading local OTT service provider in Korea, received 250 billion won in investment, valuing it at about 2 trillion won.</li>
<li>Previous to this investment, Tving was last valued at 350 billion won in July 2021. In other words, Tving's value surged by nearly 6x in the past seven months. </li>
<li>Our NAV per share of CJ ENM suggests a target price of 185,824 won, representing a 43% upside from current levels. </li>
</ul>


In the past week, it was announced that Tving, a leading local OTT service provider in Korea, received 250 billion won in investment, valuing it at about 2 trillion won.
Previous to this investment, Tving was last valued at 350 billion won in July 2021. In other words, Tving's value surged by nearly 6x in the past seven months. 
Our NAV per share of CJ ENM suggests a target price of 185,824 won, representing a 43% upside from current levels. 


Tving: Value Surges by Nearly 6x to 2 Trillion Won in 7 Months - Impact on CJ ENM

<ul>
<li>Among Korea's local metaverse ETFs, the Big Three have significant AUMs. At yesterday's closing prices, their AUMs are ₩0.41T, ₩0.40T, and ₩0.20T, respectively. Their total is now 1 trillion won.</li>
<li>Those on which we can perform stable momentum trading are the 14 stocks included in all three ETFs. Passive funds account for +3% of MC in half of these names.</li>
<li>Weighting adjustment uses keyword relevance. So, estimation is not easy. Nevertheless, since the absolute value does not change significantly, we can reduce the error by using the previous rebalancing weighting.</li>
</ul>


Among Korea's local metaverse ETFs, the Big Three have significant AUMs. At yesterday's closing prices, their AUMs are ₩0.41T, ₩0.40T, and ₩0.20T, respectively. Their total is now 1 trillion won.
Those on which we can perform stable momentum trading are the 14 stocks included in all three ETFs. Passive funds account for +3% of MC in half of these names.
Weighting adjustment uses keyword relevance. So, estimation is not easy. Nevertheless, since the absolute value does not change significantly, we can reduce the error by using the previous rebalancing weighting.


Korea Local Metaverse ETFs: Passive Flow Preview

South Korea

Cheil Worldwide Inc. provides a wide range of marketing services such as new product development and advertisement, brand management, advertising budget analysis, and advertising effectiveness evaluation.  The Company also creates, prints, publishes, and produces promotional and advertising materials.

JYP Entertainment Corp plans, produces, promotes, and markets Korean singers both in Korean and overseas market. The Company's also engages in licensing, merchandizing, and artist management business including the commercial flim contracts of the artists.

CJ CGV Co., Ltd. develops and operates multi-screen movie theaters in South Korea.  The Company's theater complex also conducts stores and restaurants in theaters, and offers advertisement through screens.

Innocean Worldwide Inc. provides marketing and communications services. As a media agency, the company is engaged in promotion, sports business consulting, space design, and advertisement production.

YG Entertainment Inc., produces and markets music recording, music publishing, record manufacturing/sales, artist management, concert production, and new artist discovering/training.

Hyundai Hy Communications & Network Co Ltd is cable television and Internet service company.  The Company also generates revenue from advertisement. Hyundai HCN provides service within South Korea.

Hyundai Hy Communications & Network (126560 KS)

Seoul Broadcasting System (SBS) is a commercial television and radio broadcasting company.  The Company produces and broadcasts programs, such as news, sports, weather, music, movies, and television drama series.

CJ Hellovision Company Ltd. operates as a multi-system operator that receives programs from program providers and airs them to subscribers. The Company offers cable TV services covering news, movie, music, entertainment, documentary, sports, education, go game, culture, homeshopping, and local broadcasting, as well as ground wave and satellite TV broadcasting channels.

Nasmedia Co., Ltd. is a Media Rep company that markets various advertising services based on the internet and mobile devices.  The Company's advertising service engages in digital signages, advertising solution, and web analysis.

YG PLUS provides a wide range of advertisement services through television, magazine, radio, and newspaper.  The Company also offers marketing and event planning related to sales promotion (SP) services.

Network 18 Media & Investments Ltd. is an entertainment holding company.  The Company, through its subsidiaries, operates a business news television channel; offers Internet access; operates real-time news terminals; operates general news television channels; produces motion pictures; and retails goods on television and over the Internet.

DAIICHIKOSHO CO., LTD. manufactures, sells, and, leases karaoke equipment and software.  The Company also operates karaoke booth chains called Big Echo, provides karaoke software via cable line called DAM, and participates in broadcasting via satellite.

TV Asahi Holdings Corporation produces and broadcasts a variety of television programs mainly in the Tokyo area. The Company sells commercial spots through a network system. TV Asahi also provides patent maintenance for music publication, entertainment planning, sales of broadcasting equipment, and TV shopping.

CITIC Guoan Information Industry Co., Ltd., through its subsidiary, installs, tests, and operates cable TV and satellite telecommunication networks. The Company also develops real estate properties .  In addition, CITIC designs network integrated systems and application software, and provides advertising services.

Sinclair Broadcast Group, Inc. is a diversified broadcasting company that owns or provides programming services to television stations across the United States.  The Company's television group includes FOX, WB, ABC, CBS, NBC, and UPN affiliates.

Visual China Group Co., Ltd. manufactures cultural and entertainment products and technologies. The Company's products include radio and television transmission technology, Internet transmission, Internet games and entertainment, mobile communications network gaming and entertainment technology, and computer software development.

Central China Land Media Co., Ltd. operates media businesses.  The company provides web services for news, publishing, movies and television related programs.

Hunan TV & Broadcast Intermediary Co. Ltd. designs, produces, and broadcasts TV advertisement and provide advertising agent services.  The Company also makes television programs, operates theme parks, and provides cable TV network program delivery services.

Beijing Gehua CATV Network Co., Ltd. builds, manages, and maintains cable TV networks. The Company also provides advertising and information services.

Beijing Gehua Catv Network Co, Ltd. (600037 CH)

Guangdong Advertising Group Co.,Ltd provides integrated market communication service.  The Company's services include brand management, media agency, costume design, private advertising media,photography,technology development and television planning.

S.M.Entertainment Co. plans, produces, promotes, and markets Korean rock and roll music in several formats, such as compact discs (CD), concert tours, television productions, and music videos.  The Company also operates artist management business as well as licensing and copyright business from the company's music records.

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S.M.Entertainment Co (041510 KS)

NPS Sells SK Bioscience, Naver, & LG Electronics and Buys Kakao Bank, Lotte Corp, & Samyang Foods

NPS moves the Korean stock market more than any other investor. In this insight, we discuss the recent buying and selling by the Korea National...

Douglas Kim

Kakao Entertainment: A Korean Entertainment Powerhouse

Kakao Entertainment is one of the biggest entertainment companies in Korea. The company has a strong IP for webtoons, web novels, music, drama,...

Douglas Kim

WISE Media Contents (TIGER ETF) Rebalancing Preview

This post previews the upcoming rebalancing of the WISE Media Contents Theme Index (TIGER ETF), whose effective date is April 15.

Sanghyun Park

Tving: Value Surges by Nearly 6x to 2 Trillion Won in 7 Months - Impact on CJ ENM

Tving, a leading local OTT service provider in Korea, received 250 billion won in investment, valuing it at about 2 trillion won. up from its...

Douglas Kim

Korea Local Metaverse ETFs: Passive Flow Preview

This post tracks and previews the passive flows of Korea's three metaverse sector ETFs for the upcoming semi-annual rebalancing in June.

Sanghyun Park

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