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

Event-Driven

<ul>
<li>The index committee has continued to use a 6 month minimum listing history leading to five changes to the <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">SSE STAR50 (STAR50 INDEX)</a> in June.</li>
<li>One way turnover is estimated at 8.56% and will result in a one-way trade of CNY 3,496m. Passive trackers will need to trade between 2-6 days ADV on the adds/deletes.</li>
<li>The inclusions have outperformed the deletions and the CSI500 Index since the end of the review period with all inclusions moving higher over the period.</li>
</ul>


The index committee has continued to use a 6 month minimum listing history leading to five changes to the SSE STAR50 (STAR50 INDEX) in June.
One way turnover is estimated at 8.56% and will result in a one-way trade of CNY 3,496m. Passive trackers will need to trade between 2-6 days ADV on the adds/deletes.
The inclusions have outperformed the deletions and the CSI500 Index since the end of the review period with all inclusions moving higher over the period.


STAR50 Index Rebalance: Dear Index Committee...

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

Shanghai MicroPort Endovascula / Equity Bottom-Up

<ul>
<li>The aortic product line would bring strong growth in 1-2 years. From 3 years or longer term, Endovascular’s peripheral vascular interventional devices would be the main driver for high growth.</li>
<li>We don’t think the centralized procurement would be a concern for the time being. As many products are or will apply for CE Mark, the progress of internationalization is promising.</li>
<li>The current valuation is very attractive. Due to the pandemic/lockdown in China and many external uncertainties, share price could go lower, but it's still a good company to invest in.</li>
</ul>


The aortic product line would bring strong growth in 1-2 years. From 3 years or longer term, Endovascular’s peripheral vascular interventional devices would be the main driver for high growth.
We don’t think the centralized procurement would be a concern for the time being. As many products are or will apply for CE Mark, the progress of internationalization is promising.
The current valuation is very attractive. Due to the pandemic/lockdown in China and many external uncertainties, share price could go lower, but it's still a good company to invest in.


Shanghai Microport Endovascular MedTech (688016.CH) 21/22Q1 - This Is a Company Worth Investing In

<ul>
<li>There could be 3 or 5 changes to the <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50 INDEX</a> in June depending on the minimum listing history (6 months or 12 months) used by the index committee.</li>
<li>
<a href="https://www.smartkarma.com/entities/jinko-solar-co-ltd" target="_blank" data-smartkarma-citation="entities:35715:1" rel="noopener">Jinko Solar (688223 CH)</a> is a high probability inclusion while <a href="https://www.smartkarma.com/entities/shanghai-microport-endovascular-medtech-a" target="_blank" data-smartkarma-citation="entities:30310:1" rel="noopener">Shanghai Microport Endovascular MedTech (688016 CH)</a>, <a href="https://www.smartkarma.com/entities/arcsoft-corp-ltd" target="_blank" data-smartkarma-citation="entities:30335:1" rel="noopener">ArcSoft Corp Ltd (688088 CH)</a> and <a href="https://www.smartkarma.com/entities/dbapp-security-ltd" target="_blank" data-smartkarma-citation="entities:30316:1" rel="noopener">DBAPP Security Ltd (688023)</a> are high probability deletions.</li>
<li>Stocks performance over the last couple of months indicates the market is assigning a higher probability to the index committee using a 12 month minimum listing history.</li>
</ul>


There could be 3 or 5 changes to the STAR50 INDEX in June depending on the minimum listing history (6 months or 12 months) used by the index committee.

Jinko Solar (688223 CH) is a high probability inclusion while Shanghai Microport Endovascular MedTech (688016 CH), ArcSoft Corp Ltd (688088 CH) and DBAPP Security Ltd (688023) are high probability deletions.
Stocks performance over the last couple of months indicates the market is assigning a higher probability to the index committee using a 12 month minimum listing history.


STAR50 Index Rebalance Preview: 3 Changes or 5? It Depends...

<ul>
<li>There could be 3 or 5 changes to the <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50 INDEX</a> in June depending on the minimum listing history (6 months or 12 months) used by the index committee.</li>
<li>
<a href="https://www.smartkarma.com/entities/jinko-solar-co-ltd" target="_blank" data-smartkarma-citation="entities:35715:1" rel="noopener">Jinko Solar (688223 CH)</a> is a high probability inclusion while <a href="https://www.smartkarma.com/entities/shanghai-microport-endovascular-medtech-a" target="_blank" data-smartkarma-citation="entities:30310:1" rel="noopener">Shanghai Microport Endovascular MedTech (688016 CH)</a>, <a href="https://www.smartkarma.com/entities/arcsoft-corp-ltd" target="_blank" data-smartkarma-citation="entities:30335:1" rel="noopener">ArcSoft Corp Ltd (688088 CH)</a> and <a href="https://www.smartkarma.com/entities/dbapp-security-ltd" target="_blank" data-smartkarma-citation="entities:30316:1" rel="noopener">DBAPP Security Ltd (688023)</a> are high probability deletions.</li>
<li>The March rebalance will be implemented at the close tomorrow. The adds have outperformed the deletes post announcement and there could be a reversal from next week.</li>
</ul>


There could be 3 or 5 changes to the STAR50 INDEX in June depending on the minimum listing history (6 months or 12 months) used by the index committee.

Jinko Solar (688223 CH) is a high probability inclusion while Shanghai Microport Endovascular MedTech (688016 CH), ArcSoft Corp Ltd (688088 CH) and DBAPP Security Ltd (688023) are high probability deletions.
The March rebalance will be implemented at the close tomorrow. The adds have outperformed the deletes post announcement and there could be a reversal from next week.


STAR50 Index Rebalance Preview (June): Back to the All Important Question

<ul>
<li>Although Endovastec has leading position in aortic products, the growth space of this field in China is relatively limited and is not enough to support the long-term development of Endovastec.</li>
<li>The lack of revolutionary blockbuster product/candidate with global pricing power as well as the current weak international business layout are also the concerns.</li>
<li>Our view is that <a href="https://www.smartkarma.com/entities/shanghai-microport-endovas-a" target="_blank" data-smartkarma-citation="entities:30310:1" rel="noopener">Shanghai Microport Endovascular MedTech (688016 CH)</a> (Endovastec) is a good company, but it is not as attractive as <a href="https://www.smartkarma.com/entities/lifetech-scientific-corp" target="_blank" data-smartkarma-citation="entities:13181:1" rel="noopener">Lifetech Scientific (1302 HK)</a> at the current stage.</li>
</ul>


Although Endovastec has leading position in aortic products, the growth space of this field in China is relatively limited and is not enough to support the long-term development of Endovastec.
The lack of revolutionary blockbuster product/candidate with global pricing power as well as the current weak international business layout are also the concerns.
Our view is that Shanghai Microport Endovascular MedTech (688016 CH) (Endovastec) is a good company, but it is not as attractive as Lifetech Scientific (1302 HK) at the current stage.


Shanghai Microport Endovascular MedTech (688016.CH) - Not as Attractive as Lifetech

China

Sinocare Inc. develops, manufactures, sells biosensor technology real-time detection products. The Company's main products include rapid trace blood glucose testers, and supporting blood glucose testing strips.

Shinva Medical Instrument Co., Ltd. manufactures and markets medical instruments and equipment.  The Company's products include sterilization equipment, radiation diagnosis and radiotherapy equipment, chemical indication products, and medical environmental protection equipment.

Guangzhou Wondfo Biotech Co.,Ltd. was founded in 1992. The company's line of business includes manufacturing of medical diagnostic tests.  Guangzhou Wondfo Biotech serves customers around the world.

Double Medical Technology Inc. operates as an orthopedic devices manufacturing company. The Company produces and sells physical therapy equipment, orthopedic surgical instruments, injection puncture, and other products. Double Medical Technology markets its products throughout China.

Microport Scientific Corp. manufactures interventional and minimally invasive devices for keyhole surgery. The Company's products are used to treat vascular diseases and is developing devices to treat diabetes and orthopedic diseases.

Shanghai Tofflon Science and Technology Company Limited develops, designs, produces and markets pharmaceutical freeze dryer and related systems. The Company's main products include in-place sterilisation, in-place lyophilization cleaners, laboratory freeze dryers, production freeze dryers, liquid nitrogen freeze dryers and freeze drying systems and equipments.

Shandong Weigao Group Medical Polymer Company Limited, through its subsidiaries, researches and develops, produces, and sells single-use aseptic polymer medical products.

Shandong Weigao Group Medical Polymer Co (1066 HK)

Shandong Pharmaceutical Glass Co., Ltd. manufactures and markets a variety of pharmaceutical glass products including molded vials, tube vials, ampoule, amber vials, infusion vials, and glass tubes.  The Company also manufactures paper packaging boxes and invests in petrochemical industry.

Shandong Pharmaceutical Glass Co., Ltd. A (600529 CH)

Shandong Pharmaceutical Glass Co., Ltd. A

Andon Health Co., Ltd. develops, manufactures and sells medical electronic devices for home use.  The Company's products include blood pressure monitors, blood glucose monitors, and digital thermometers.

Lifetech Scientific Corporation develops, manufactures and markets minimally invasive interventional medical devices for cardiovascular and peripheral vascular diseases and disorders.  The Company produces congenital heart defect occluders, vena cava filters, stent grafts, balloon catheters, and vascular plugs.

Veracyte, Inc. develops molecular tests for oncology. The Company offers molecular cytology and tests for the diagnostic accuracy of cytology samples. Veracyte provides its products and services to healthcare and molecular diagnostic companies in the United States.

NAKANISHI INC. manufactures gyration equipment for dental and industry use. The Company's products include precision spindles and hand-held grinders.

Ossur hf does research and develops prosthetic aids.  The Company also designs, makes, and markets prosthetic and orthotic products, and offers a wide line of customized solutions.  The product line includes Iceross, a silicon socket, the ICEX socket system, and Masterstep, a prosthetic foot.  Ossur operates through a global network of sales outlets and agencies.

Osstem Implant Co., Ltd. manufactures dental implant system. The Company also markets dental management software. Osstem Implant provides products for dental surgery and exports abroad.

Artivion Inc.(Artivion) is a medical device company focused on developing simple, elegant solutions that address cardiac and vascular surgeons' most difficult challenges in treating patients with aortic disease. The company's major products include:aortic stents, stent grafts, prosthetic heart valves, cyropreserved cardiac and vascular allografts, and surgical sealants.

MANI, INC. manufactures medical goods and equipment.  The Company's products include threads and needles for surgeries, surgical knives for eye surgeries, and dental instruments and equipment.

LeMaitre Vascular, Inc. manufactures medical devices for vascular surgeons and interventionists.  The Company develops, produces, and markets disposable and implantable devices for the treatment of peripheral vascular disease, such as stent grafts, anastomotic clips, valvulotomes, radiopaque marking tape, shunts, and embolectomy catheters.

NuVasive, Inc. designs, develops, and markets products for the surgical treatment of spine disorders. The Company's products include Maximum Access Surgery (MAS) and Fusion products.

AtriCure, Inc. develops, manufactures, and sells surgical devices designed to create precise lesions in soft tissues.  The Company's bipolar ablation system is used by cardiothoracic surgeons as a standard treatment alternative to create lesions in heart tissue to block the abnormal electrical impulses that cause atrial fibrillation.

STAAR Surgical Company develops, manufactures, and markets high margin visual implants that improve a patient's quality of vision.  The Company manufactures implantable contact lenses to treat refractive disorders such as myopia.  STAAR also manufactures products for cataract surgery and glaucoma surgery.

Shanghai MicroPort Endovascular MedTech (Gruop) Co., Ltd. develops and sells medical instruments. The Company manufactures and sells peripheral vascular stents, aortic balloon dilation catheters, aortic stent grafts, and other related products. Shanghai MicroPort Endovascular MedTech (Gruop) markets its products primarily throughout China with limited overseas.

Shanghai MicroPort Endovascula (688016 CH)

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Shanghai MicroPort Endovascula (688016 CH)

STAR50 Index Rebalance: Dear Index Committee...

There are 5 changes to the STAR50 Index in June as the index committee continues to use a 6 month minimum listing history. The adds have...

Brian Freitas

Shanghai Microport Endovascular MedTech (688016.CH) 21/22Q1 - This Is a Company Worth Investing In

Endovascular’s product lines and promising internationalization will bring strong growth. The centralized procurement wouldn't be a concern for the...

Xinyao (Criss) Wang

STAR50 Index Rebalance Preview: 3 Changes or 5? It Depends...

There could be 3/5 changes in June depending on whether the index committee uses a 12/6 month minimum listing history. The market is assigning a...

Brian Freitas

STAR50 Index Rebalance Preview (June): Back to the All Important Question

Depending on the minimum listing history used, there will be 3 or 5 changes. JinkoSolar is a high probability inclusion. The March rebalance will...

Brian Freitas

Shanghai Microport Endovascular MedTech (688016.CH) - Not as Attractive as Lifetech

This insight analyzed Endovastec about the industry characteristics of aortic and peripheral products, the business layout, and the concerns on...

Xinyao (Criss) Wang

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