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>Local institutions, notably pension funds, are increasingly investing in Samsung SDS, coinciding with the company's more active investor engagement. This has sparked speculation about Samsung's strategic motives.</li>
<li>Timing-Wise, as AI infra demands rise in Samsung Group, conditions for boosting SDS's performance improve. They monitor Samsung's moves to drive SDS's stock upward, considering its reliance on Samsung's revenue.</li>
<li>Local pension funds actively adopting overweight positions in Samsung SDS underscore the importance of crafting strategies tailored to overweighting SDS within the broader Samsung Group context.</li>
</ul>


Local institutions, notably pension funds, are increasingly investing in Samsung SDS, coinciding with the company's more active investor engagement. This has sparked speculation about Samsung's strategic motives.
Timing-Wise, as AI infra demands rise in Samsung Group, conditions for boosting SDS's performance improve. They monitor Samsung's moves to drive SDS's stock upward, considering its reliance on Samsung's revenue.
Local pension funds actively adopting overweight positions in Samsung SDS underscore the importance of crafting strategies tailored to overweighting SDS within the broader Samsung Group context.


Local Institutional Flows Towards Overweighting Samsung SDS in Samsung Group Context

APAC IPOs & Placements, Aequitas Research

Ethan Aw

APAC IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Doosan Robotics  / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/doosan-robotics" target="_blank" data-smartkarma-citation="entities:36816:1" rel="noopener">Doosan Robotics (DOOSANROBO KS)</a> is looking to raise up to US$314m in its Korean IPO. </li>
<li>Doosan Robotics (DR) manufactures and sells collaborative robots (Cobots). The firm’s product portfolio primarily includes different series of robot arms as well as its coffee module. </li>
<li>In our previous notes, we looked at the company’s past performance and undertook a peer comparison. In this note, we talk about valuation.</li>
</ul>



Doosan Robotics (DOOSANROBO KS) is looking to raise up to US$314m in its Korean IPO. 
Doosan Robotics (DR) manufactures and sells collaborative robots (Cobots). The firm’s product portfolio primarily includes different series of robot arms as well as its coffee module. 
In our previous notes, we looked at the company’s past performance and undertook a peer comparison. In this note, we talk about valuation.


Doosan Robotics IPO - Thoughts on Valuation - A Punt at Best, a Crash at Worst

<ul>
<li>The market's reaction to Samsung Fire's stake sale seems overhyped. Given past share sales, Life may outperform Fire as this momentum unfolds.</li>
<li>I don’t see SDS merging with Samsung Electronics. It lacks synergy and could stir up PR issues. If Sammy’s stock stalls, Lee Jae-yong might sell more of his SDS stake.</li>
<li>I’m still bullish on Sammy prefs. If the tax reform passes, a special dividend, not a buyback, will be the cleanest way for Samsung to address inheritance tax.</li>
</ul>


The market's reaction to Samsung Fire's stake sale seems overhyped. Given past share sales, Life may outperform Fire as this momentum unfolds.
I don’t see SDS merging with Samsung Electronics. It lacks synergy and could stir up PR issues. If Sammy’s stock stalls, Lee Jae-yong might sell more of his SDS stake.
I’m still bullish on Sammy prefs. If the tax reform passes, a special dividend, not a buyback, will be the cleanest way for Samsung to address inheritance tax.


My Take on the Three Scenarios that Sammy Buyback Stirred up in the Market Today

<ul>
<li>Most loans with collateral floors are at or below thresholds, and all three court deposits are near or under a 30% drop from their initial valuation.</li>
<li>No solid intel on share sales yet, and it's unlikely they’ll sell Samsung Electronics after a 30% dip. They may focus on their stakes in Samsung Life or Samsung SDS.</li>
<li>There's talk Samsung might boost prices to help the family avoid the collateral floor issue, but with DRAM demand down, a major shareholder return seems unlikely for now.</li>
</ul>


Most loans with collateral floors are at or below thresholds, and all three court deposits are near or under a 30% drop from their initial valuation.
No solid intel on share sales yet, and it's unlikely they’ll sell Samsung Electronics after a 30% dip. They may focus on their stakes in Samsung Life or Samsung SDS.
There's talk Samsung might boost prices to help the family avoid the collateral floor issue, but with DRAM demand down, a major shareholder return seems unlikely for now.


Situation Flagged: Sammy Stock Hits Level that Squeezes Family’s Loan Collateral Floor

<ul>
<li>Maximizing Lee Jae-yong's dividend income is crucial, making Samsung SDS's ₩5.5T cash assets key, thus prompting the merger of Samsung C&amp;T and Samsung SDS's BPO division.</li>
<li>With no legal risks for Lee Jae-yong, Samsung C&amp;T needs the merger to increase assets and avoid forced holding company conversion, making the acquisition of Samsung SDS’s BPO division necessary.</li>
<li>We should target a setup for likely appraisal rights for C&amp;T. Monitor and capture the spread between the stock price and appraisal rights exercise price.</li>
</ul>


Maximizing Lee Jae-yong's dividend income is crucial, making Samsung SDS's ₩5.5T cash assets key, thus prompting the merger of Samsung C&amp;T and Samsung SDS's BPO division.
With no legal risks for Lee Jae-yong, Samsung C&amp;T needs the merger to increase assets and avoid forced holding company conversion, making the acquisition of Samsung SDS’s BPO division necessary.
We should target a setup for likely appraisal rights for C&amp;T. Monitor and capture the spread between the stock price and appraisal rights exercise price.


Examining Market Interest in the Potential Samsung C&T and SDS Restructuring

South Korea

Samsung SDS Co., Ltd. provides information technology services, such as consulting and technical services. The Company also offers outsourcing services including application outsourcing, IT infrastructure outsourcing, and cloud computing.

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Samsung Sds (018260 KS)

Local Institutional Flows Towards Overweighting Samsung SDS in Samsung Group Context

This post offers observations into local institutional flows favoring overweighting Samsung SDS within the broader Samsung Group context.

Sanghyun Park

Doosan Robotics IPO - Thoughts on Valuation - A Punt at Best, a Crash at Worst

Doosan Robotics (DOOSANROBO KS) is looking to raise up to US$314m in its Korean IPO. comparison. In this note, we talk about valuation.

Ethan Aw

My Take on the Three Scenarios that Sammy Buyback Stirred up in the Market Today

This post contains my personal view on the three scenarios triggered by Samsung Electronics' buyback that shook the market today.

Sanghyun Park

Situation Flagged: Sammy Stock Hits Level that Squeezes Family’s Loan Collateral Floor

Samsung Electronics hits a level squeezing the Samsung family’s stock-backed loan collateral floor, tied to their inheritance tax—definitely a key...

Sanghyun Park

Examining Market Interest in the Potential Samsung C&T and SDS Restructuring

This post examines the growing market interest and trading angles in the potential restructuring involving Samsung C&T and Samsung SDS.

Sanghyun Park

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