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 review period for a global index commenced last week and will run through this week as well.</li>
<li>The announcement of the changes for the LQ45 Index should be announced in the coming week and will be implemented at the close on 31 January.</li>
<li>Huge inflows to <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-inde" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI 300 Index</a> trackers during the week while there was a big outflow from <a href="https://www.smartkarma.com/entities/tracker-fund-of-hong-kong-ltd" target="_blank" data-smartkarma-citation="entities:29257:1" rel="noopener">Tracker Fund of Hong Kong (2800 HK)</a>. </li>
</ul>


The review period for a global index commenced last week and will run through this week as well.
The announcement of the changes for the LQ45 Index should be announced in the coming week and will be implemented at the close on 31 January.
Huge inflows to CSI 300 Index trackers during the week while there was a big outflow from Tracker Fund of Hong Kong (2800 HK). 


Index Rebalance & ETF Flow Recap: ASX, KS200, KQ150, HSIII, STTF, L&F, Costa Group, Japan, Bud APAC

<ul>
<li>With over 40% of the review period complete, there could be 15 changes for the <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ 150 Index (KOSDQ150 INDEX)</a> at the June rebalance.</li>
<li>There could be two changes before that if <a href="https://www.smartkarma.com/entities/l-f-co-ltd" target="_blank" data-smartkarma-citation="entities:14300:1" rel="noopener">L&amp;F Co Ltd (066970 KS)</a> and <a href="https://www.smartkarma.com/entities/hlb-inc" target="_blank" data-smartkarma-citation="entities:16969:1" rel="noopener">HLB Inc (028300 KS)</a> complete their transfer from the KOSDAQ market to the KOSPI market.</li>
<li>The adds have outperformed the deletes and the <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ 150 Index</a> since the start of the review period. The ban on short selling could lead to another leg up.</li>
</ul>


With over 40% of the review period complete, there could be 15 changes for the KOSDAQ 150 Index (KOSDQ150 INDEX) at the June rebalance.
There could be two changes before that if L&amp;F Co Ltd (066970 KS) and HLB Inc (028300 KS) complete their transfer from the KOSDAQ market to the KOSPI market.
The adds have outperformed the deletes and the KOSDAQ 150 Index since the start of the review period. The ban on short selling could lead to another leg up.


KOSDAQ150 Index Rebalance Preview: Potential Adds Soaring; Short Sell Ban Not Helping

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<ul>
<li>Our base case valuation of Revu Corp is target price of 19,403 won, which is 47% higher than the high end of the IPO price range (13,200 won). </li>
<li>Revu's main business is marketing using influencers who are major content providers in the SNS advertising market.</li>
<li>The influencer based marketing/advertising is one of the highest growing segments and we believe Revu Corp has an attractive platform to further expand its business on a profitable basis.</li>
</ul>


Our base case valuation of Revu Corp is target price of 19,403 won, which is 47% higher than the high end of the IPO price range (13,200 won). 
Revu's main business is marketing using influencers who are major content providers in the SNS advertising market.
The influencer based marketing/advertising is one of the highest growing segments and we believe Revu Corp has an attractive platform to further expand its business on a profitable basis.


<ul>
<li>Revu Corporation is the number one influencer platform company in Korea with the largest number of influencer members in the industry.</li>
<li>The IPO price range is from 11,500 won to 13,200 won. The maximum total offering amount is 29.5 billion won. </li>
<li>The bankers used three companies including DearU, Silicon2, and Connectwave as comparable companies for Revu Corp. The average P/E of the comps is 32.6x.</li>
</ul>


Revu Corporation is the number one influencer platform company in Korea with the largest number of influencer members in the industry.
The IPO price range is from 11,500 won to 13,200 won. The maximum total offering amount is 29.5 billion won. 
The bankers used three companies including DearU, Silicon2, and Connectwave as comparable companies for Revu Corp. The average P/E of the comps is 32.6x.


<div class="content-highlight">
<p><strong>Our base case valuation of Silicon2 Co is implied market cap of 436.5 billion won or 41,975 won per share, which is 54% higher than the high end of the IPO price range of 27,200 won per share. Given the attractive upside, we have a POSITIVE view of the Silicon2 Co IPO and we would subscribe to the IPO deal. </strong></p>
<p>Our base case valuation is based on 28.6x our estimated net profit of 15.3 billion won for the company in 2022. Our valuation multiple of 28.6x P/E is based on the average P/E valuation multiple of the peers in 2022. Our valuation sensitivity analysis suggests a low-high value of 30,222 won per share to 55,407 won per share.</p>
<p>Silicon2 Co has better metrics than its peers for operating margins, ROE, and sales growth. As such, one could make the case of higher valuation multiple for the company as compared to its peers. </p>
</div><div><p></p></div>


Our base case valuation of Silicon2 Co is implied market cap of 436.5 billion won or 41,975 won per share, which is 54% higher than the high end of the IPO price range of 27,200 won per share. Given the attractive upside, we have a POSITIVE view of the Silicon2 Co IPO and we would subscribe to the IPO deal. 
Our base case valuation is based on 28.6x our estimated net profit of 15.3 billion won for the company in 2022. Our valuation multiple of 28.6x P/E is based on the average P/E valuation multiple of the peers in 2022. Our valuation sensitivity analysis suggests a low-high value of 30,222 won per share to 55,407 won per share.
Silicon2 Co has better metrics than its peers for operating margins, ROE, and sales growth. As such, one could make the case of higher valuation multiple for the company as compared to its peers. 


South Korea

Silicon2 operates e-commerce business. The Company wholesales daily necessities, packaged food, makeup products, and other products. SIlicon2 also provides brand planning advertising and marketing services.

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Silicon2 (257720 KS)

Index Rebalance & ETF Flow Recap: ASX, KS200, KQ150, HSIII, STTF, L&F, Costa Group, Japan, Bud APAC

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

KOSDAQ150 Index Rebalance Preview: Potential Adds Soaring; Short Sell Ban Not Helping

There could be 15 changes for the KOSDAQ150 Index in June. The potential adds have outperformed the deletes and the index since the start of the...

Brian Freitas

Revu Corporation IPO Valuation Analysis

The influencer based marketing/advertising is one of the highest growing segments and we believe Revu Corp has an attractive platform to further...

Douglas Kim

Revu Corporation IPO Preview

Revu Corporation is the number one influencer platform company in Korea with the largest number of influencer members in the industry. The IPO...

Douglas Kim

Silicon2 Co IPO Valuation Analysis

Our base case valuation of Silicon2 Co is implied market cap of 436.5 billion won or 41,975 won per share, which is 54% higher than the high end of...

Douglas Kim

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