Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<ul>
<li>In July 2022, <a href="https://www.smartkarma.com/entities/sd-biosensor-inc" target="_blank" data-smartkarma-citation="entities:33333:1" rel="noopener">SD Biosensor (137310 KS)</a> in partnership with SJL Partners signed a definitive merger agreement to acquire <a href="https://www.smartkarma.com/entities/meridian-bioscience-inc" target="_blank" data-smartkarma-citation="entities:1559:1" rel="noopener">Meridian Bioscience (VIVO US)</a>  for approximately KRW800 billion (~$1.5 billion).</li>
<li>The acquisition will strengthen SD Biosensos’s IVD platform to navigate the decline in COVID-19 testing demand and accelerate its U.S. market entry.</li>
<li>In September 2021, SD Biosensor acquired ~22% stake in UXN, which aims to launch mini continuous blood glucose meter in domestic market in 2024.</li>
</ul>


In July 2022, SD Biosensor (137310 KS) in partnership with SJL Partners signed a definitive merger agreement to acquire Meridian Bioscience (VIVO US)  for approximately KRW800 billion (~$1.5 billion).
The acquisition will strengthen SD Biosensos’s IVD platform to navigate the decline in COVID-19 testing demand and accelerate its U.S. market entry.
In September 2021, SD Biosensor acquired ~22% stake in UXN, which aims to launch mini continuous blood glucose meter in domestic market in 2024.


SD Biosensor (137310 KS): Aggressively Investing Windfall Gain From COVID; Adding New Growth Engines

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Event-Driven

<ul>
<li>Our base case valuation LG Energy Solution is implied market cap of 75 trillion won or target price of 319,089 won, representing 25% below current share price.</li>
<li>Currently, LGES is trading at a premium valuation multiple on a EV/EBITDA (2023E) versus CATL. We believe LGES should trade at a discount to CATL in the next 6-12 months. </li>
<li>LGES's 6 months lock-up ends on 27 July and there are 4.3% of outstanding shares that can be sold which is likely to put negative pressure on share price.</li>
</ul>


Our base case valuation LG Energy Solution is implied market cap of 75 trillion won or target price of 319,089 won, representing 25% below current share price.
Currently, LGES is trading at a premium valuation multiple on a EV/EBITDA (2023E) versus CATL. We believe LGES should trade at a discount to CATL in the next 6-12 months. 
LGES's 6 months lock-up ends on 27 July and there are 4.3% of outstanding shares that can be sold which is likely to put negative pressure on share price.


LG Energy Solution: End of 6 Months Lock-Up Period & Valuation Sensitivity Analysis

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>All of these additions experienced significant levels of short trading yesterday. In particular, those newly listed stocks saw harsher shorting attacks, similar to what we witnessed at the last rebalancing.</li>
<li>A certain level of short selling trend for newly listed stocks will likely work the same this time, and the applicable period is expected to be 3-4 trading days.</li>
<li>That is, we need to target the newly listed stocks again for this rebalancing: Iljin Hysolus (271940 KS), K Car (381970 KS), and SD Biosensor (137310 KS).</li>
</ul>


All of these additions experienced significant levels of short trading yesterday. In particular, those newly listed stocks saw harsher shorting attacks, similar to what we witnessed at the last rebalancing.
A certain level of short selling trend for newly listed stocks will likely work the same this time, and the applicable period is expected to be 3-4 trading days.
That is, we need to target the newly listed stocks again for this rebalancing: Iljin Hysolus (271940 KS), K Car (381970 KS), and SD Biosensor (137310 KS).


Shorting Trend Projections on KOSPI 200 Additions

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

<ul>
<li>There are 7 adds and 7 deletes for the <a href="https://www.smartkarma.com/entities/korea-stock-exchange-kospi-200-index" target="_blank" data-smartkarma-citation="entities:26021:1" rel="noopener">Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX)</a> rebalance to be implemented at the close on 9 June.</li>
<li>There are also a bunch of stocks that will have changes applied to their free float. There were announced last week and are much less tracked.</li>
<li>The flows and impact on some of the float change names are significant and pre-positioning and passive flows could move the stocks over the next few days.</li>
</ul>


There are 7 adds and 7 deletes for the Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX) rebalance to be implemented at the close on 9 June.
There are also a bunch of stocks that will have changes applied to their free float. There were announced last week and are much less tracked.
The flows and impact on some of the float change names are significant and pre-positioning and passive flows could move the stocks over the next few days.


KOSPI200 Index Rebalance: Float Changes, Flows & Trades

<ul>
<li>Flows from the ETFs/index funds serve as a minimal flow for rebalancing trading at the close on June 9. The total AUM is ₩18.9T: ETFs ₩15.0T and index funds ₩3.9T.</li>
<li>There are only three trading days left until the rebalancing trading. At this point, a setup aimed at the NPS/Insurance's preemptive trading seems a bit off, timing-wise.</li>
<li>It seems more appropriate at this point to design a day basket-trading based on the minimal flow size on the day of rebalancing trading, June 9.</li>
</ul>


Flows from the ETFs/index funds serve as a minimal flow for rebalancing trading at the close on June 9. The total AUM is ₩18.9T: ETFs ₩15.0T and index funds ₩3.9T.
There are only three trading days left until the rebalancing trading. At this point, a setup aimed at the NPS/Insurance's preemptive trading seems a bit off, timing-wise.
It seems more appropriate at this point to design a day basket-trading based on the minimal flow size on the day of rebalancing trading, June 9.


KOSPI 200 Rebalancing Minimal Flow at the Close on June 9 For Day Basket-Trading

South Korea

SD Biosensor, INC. operates medical device manufacturing businesses. The Company produces electric medical instruments and other products. SD Biosensor conducts businesses across worldwide.

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SD Biosensor (137310 KS)