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.

Equity Capital Markets

SK IE Technology   / Equity Capital Markets

<p>This is a 21.4M offering, of which 11.8M (55%) go to institutional investors.</p><p>Again, the demand far exceeds what is allocated. 22.2B demands were put on the table by a total of 1,734 institutions, bumping up the subscription rate to 1,882.88 to 1. Of course, this is a new record, easily beating the previous record-holder Kakao Games (1,478.50 to 1).</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td style="width: 197.5px;" data-sheets-value='{"1":2,"2":"Name"}'>Name</td>
<td style="text-align: right; width: 79.1667px;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right; width: 121.667px;" data-sheets-value='{"1":2,"2":"IPO date"}'>IPO date</td>
<td style="text-align: right; width: 117.5px;" data-sheets-value='{"1":2,"2":"Offering size (₩B)"}'>Offering size (₩B)</td>
<td style="text-align: right; width: 125px;" data-sheets-value='{"1":2,"2":"Book-building"}'>Bookbuilding subscription rate</td>
</tr>
<tr>
<td style="width: 197.5px;">SK IE Technology</td>
<td style="text-align: right; width: 79.1667px;">361610</td>
<td style="text-align: right; width: 121.667px;">TBA</td>
<td style="text-align: right; width: 117.5px;">2,246.0</td>
<td style="text-align: right; width: 125px;">1,882.88 to 1</td>
</tr>
<tr>
<td style="width: 197.5px;" data-sheets-value='{"1":2,"2":"SK Bioscience Co Ltd"}'>SK Bioscience Co Ltd</td>
<td style="text-align: right; width: 79.1667px;" data-sheets-value='{"1":3,"3":302440}'>302440</td>
<td style="text-align: right; width: 121.667px;" data-sheets-value='{"1":2,"2":"2021.03.18"}'>2021.03.18</td>
<td style="text-align: right; width: 117.5px;" data-sheets-value='{"1":3,"3":1491.8}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>1,491.8</td>
<td style="text-align: right; width: 125px;" data-sheets-value='{"1":3,"3":1274.5}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>1,274.50 to 1</td>
</tr>
<tr>
<td style="width: 197.5px;" data-sheets-value='{"1":2,"2":"HYBE Co Ltd"}'>HYBE Co Ltd</td>
<td style="text-align: right; width: 79.1667px;" data-sheets-value='{"1":3,"3":352820}'>352820</td>
<td style="text-align: right; width: 121.667px;" data-sheets-value='{"1":2,"2":"2020.10.15"}'>2020.10.15</td>
<td style="text-align: right; width: 117.5px;" data-sheets-value='{"1":3,"3":962.6}'>962.6</td>
<td style="text-align: right; width: 125px;" data-sheets-value='{"1":3,"3":1117}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>1,117.00 to 1</td>
</tr>
<tr>
<td style="width: 197.5px;" data-sheets-value='{"1":2,"2":"Kakao Games Corp"}'>Kakao Games Corp</td>
<td style="text-align: right; width: 79.1667px;" data-sheets-value='{"1":3,"3":293490}'>293490</td>
<td style="text-align: right; width: 121.667px;" data-sheets-value='{"1":2,"2":"2020.09.10"}'>2020.09.10</td>
<td style="text-align: right; width: 117.5px;" data-sheets-value='{"1":3,"3":384}'>384.0</td>
<td style="text-align: right; width: 125px;" data-sheets-value='{"1":3,"3":1478.5}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>1,478.50 to 1</td>
</tr>
<tr>
<td style="width: 197.5px;" data-sheets-value='{"1":2,"2":"SK Biopharmaceuticals Co Ltd"}'>SK Biopharmaceuticals Co Ltd</td>
<td style="text-align: right; width: 79.1667px;" data-sheets-value='{"1":3,"3":326030}'>326030</td>
<td style="text-align: right; width: 121.667px;" data-sheets-value='{"1":2,"2":"2020.07.02"}'>2020.07.02</td>
<td style="text-align: right; width: 117.5px;" data-sheets-value='{"1":3,"3":959.3}'>959.3</td>
<td style="text-align: right; width: 125px;" data-sheets-value='{"1":3,"3":835}'>835.00 to 1</td>
</tr>
<tr><td colspan="5" style="width: 724.167px;" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><p>Interestingly, local hedge funds, supposedly short-term oriented, demanded much more than usual (43%). On the other hand, local public-offering funds, relatively longer-term compared with local hedge funds, demanded less than usual.</p><table class="table table-striped">
<colgroup>
<col width="300">
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"By investor type"}'>By investor type</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Institution"}'>Institution</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"%"}'>%</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Demand"}'>Demand</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"%"}'>%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Local public-offering funds"}'>Local public-offering funds</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":251}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[39]C[0]">251</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.1447520184544406}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C2">14.48%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3409256000}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[39]C[0]">3,409,256,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.1539085203049312}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C4">15.39%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Local brokerages and investment advisories"}'>Local brokerages and investment advisories</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":27}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[54]C[0]">27</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.015570934256055362}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C2">1.56%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":391425000}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[54]C[0]">391,425,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.017670612755497885}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C4">1.77%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Local pension/bank/insurance"}'>Local pension/bank/insurance</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":276}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[69]C[0]">276</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.15916955017301038}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C2">15.92%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3843923000}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[69]C[0]">3,843,923,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.17353126344753578}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C4">17.35%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Local others (hedge funds)"}'><strong>Local others (hedge funds)</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":666}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[84]C[0]"><strong>666</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.38408304498269896}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C2"><strong>38.41%</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":9465091000}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[84]C[0]"><strong>9,465,091,000</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.4272950316319812}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C4"><strong>42.73%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Foreign (foreign funds)"}'>Foreign (foreign funds)</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":276}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[99]C[0]">276</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.15916955017301038}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C2">15.92%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1635889309}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[99]C[0]">1,635,889,309</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.07385109916381943}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C4">7.39%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Foreign others (local hot money)"}'>Foreign others (local hot money)</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":238}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[114]C[0]">238</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.13725490196078433}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C2">13.73%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3405600000}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[114]C[0]">3,405,600,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.1537434726962345}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R8C4">15.37%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Total"}'>Total</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1734}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=SUM(R[-6]C[0]:R[-1]C[0])">1,734</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=SUM(R[-6]C[0]:R[-1]C[0])">100.00%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":22151184309}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=SUM(R[-6]C[0]:R[-1]C[0])">22,151,184,309</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=SUM(R[-6]C[0]:R[-1]C[0])">100.00%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Subscription rate"}'>Subscription rate</td>
<td colspan="4" rowspan="1" style="text-align: center;" data-sheets-value='{"1":3,"3":1882.8836167282925}' data-sheets-numberformat='[null,2,"#,##0.00",1]' data-sheets-formula="=R[-1]C[2]/(Terms!R[-1]C[0]*Terms!R[3]C[0])">1,882.88</td>
</tr>
<tr><td colspan="5" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><p>The "Unspecified" category usually indicates that they want the shares above the high end. With that in mind, 83.3% must have priced at the high end or above. The remaining 16.7% isn't that far either. All of the remaining 16.7% went for a 75-100% of the high end. </p><table class="table table-striped">
<colgroup>
<col width="300">
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"By price"}'>By price</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Institution"}' data-sheets-formula="=R1C2">Institution</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"%"}' data-sheets-formula="=R1C3">%</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Demand"}' data-sheets-formula="=R1C4">Demand</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"%"}' data-sheets-formula="=R1C5">%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Above high end"}'>Above high end</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1089}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[16]C[0]+R[32]C[0]+R[48]C[0]+R[64]C[0]+R[80]C[0]+R[96]C[0]">1,089</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.6280276816608996}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R25C2">62.80%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":15998522000}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[16]C[0]+R[32]C[0]+R[48]C[0]+R[64]C[0]+R[80]C[0]+R[96]C[0]">15,998,522,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.7222422863187419}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R25C4">72.22%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"75-100% of high end"}'>75-100% of high end</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":290}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[16]C[0]+R[32]C[0]+R[48]C[0]+R[64]C[0]+R[80]C[0]+R[96]C[0]">290</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.16724336793540945}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R25C2">16.72%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3633268838}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[16]C[0]+R[32]C[0]+R[48]C[0]+R[64]C[0]+R[80]C[0]+R[96]C[0]">3,633,268,838</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.16402142600221187}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R25C4">16.40%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Unspecified"}'>Unspecified</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":355}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[16]C[0]+R[32]C[0]+R[48]C[0]+R[64]C[0]+R[80]C[0]+R[96]C[0]">355</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.20472895040369088}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R25C2">20.47%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2519393471}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[16]C[0]+R[32]C[0]+R[48]C[0]+R[64]C[0]+R[80]C[0]+R[96]C[0]">2,519,393,471</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.11373628767904628}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R25C4">11.37%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Total"}'>Total</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1734}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=SUM(R[-12]C[0]:R[-1]C[0])">1,734</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R25C2">100.00%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":22151184309}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=SUM(R[-12]C[0]:R[-1]C[0])">22,151,184,309</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[0]C[-1]/R25C4">100.00%</td>
</tr>
<tr><td colspan="5" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table>

This is a 21.4M offering, of which 11.8M (55%) go to institutional investors.Again, the demand far exceeds what is allocated. 22.2B demands were put on the table by a total of 1,734 institutions, bumping up the subscription rate to 1,882.88 to 1. Of course, this is a new record, easily beating the previous record-holder Kakao Games (1,478.50 to 1).









Name
Ticker
IPO date
Offering size (₩B)
Bookbuilding subscription rate


SK IE Technology
361610
TBA
2,246.0
1,882.88 to 1


SK Bioscience Co Ltd
302440
2021.03.18
1,491.8
1,274.50 to 1


HYBE Co Ltd
352820
2020.10.15
962.6
1,117.00 to 1


Kakao Games Corp
293490
2020.09.10
384.0
1,478.50 to 1


SK Biopharmaceuticals Co Ltd
326030
2020.07.02
959.3
835.00 to 1

Source: DART

Interestingly, local hedge funds, supposedly short-term oriented, demanded much more than usual (43%). On the other hand, local public-offering funds, relatively longer-term compared with local hedge funds, demanded less than usual.









By investor type
Institution
%
Demand
%


Local public-offering funds
251
14.48%
3,409,256,000
15.39%


Local brokerages and investment advisories
27
1.56%
391,425,000
1.77%


Local pension/bank/insurance
276
15.92%
3,843,923,000
17.35%


Local others (hedge funds)
666
38.41%
9,465,091,000
42.73%


Foreign (foreign funds)
276
15.92%
1,635,889,309
7.39%


Foreign others (local hot money)
238
13.73%
3,405,600,000
15.37%


Total
1,734
100.00%
22,151,184,309
100.00%


Subscription rate
1,882.88

Source: DART

The "Unspecified" category usually indicates that they want the shares above the high end. With that in mind, 83.3% must have priced at the high end or above. The remaining 16.7% isn't that far either. All of the remaining 16.7% went for a 75-100% of the high end. 









By price
Institution
%
Demand
%


Above high end
1,089
62.80%
15,998,522,000
72.22%


75-100% of high end
290
16.72%
3,633,268,838
16.40%


Unspecified
355
20.47%
2,519,393,471
11.37%


Total
1,734
100.00%
22,151,184,309
100.00%

Source: DART



Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<p>SK IET announced its IPO book building results today. The IPO price of SK IET has been determined at 105,000 won, which is at the high end of the IPO price range. There were 1,734 institutions that participated in this IPO survey and the demand was very strong at 1,883 to 1.</p><p>Our base case valuation of SK IET is 143,413 won, which represents a 37% upside from the high end of the IPO price range of 105,000 won. Our high end valuation range of the company is 201,864 won, which represents a 92% upside from 105,000 won IPO price.</p><p>Given the strong book building results, we believe that there is a high probability that the share price of SK IET reaches close to our high-end IPO valuation case (201,864 won per share or 14.4 trillion won market cap) in the first two days of trading post IPO. Nonetheless, we believe that over a 6-12 months view, we maintain our base case valuation of 143,413 won per share (10.2 trillion won market cap). In other words, we believe many institutional investors may be looking to take some partial profits in the first two days of trading at about 200,000 won level. </p>

SK IET announced its IPO book building results today. The IPO price of SK IET has been determined at 105,000 won, which is at the high end of the IPO price range. There were 1,734 institutions that participated in this IPO survey and the demand was very strong at 1,883 to 1.Our base case valuation of SK IET is 143,413 won, which represents a 37% upside from the high end of the IPO price range of 105,000 won. Our high end valuation range of the company is 201,864 won, which represents a 92% upside from 105,000 won IPO price.Given the strong book building results, we believe that there is a high probability that the share price of SK IET reaches close to our high-end IPO valuation case (201,864 won per share or 14.4 trillion won market cap) in the first two days of trading post IPO. Nonetheless, we believe that over a 6-12 months view, we maintain our base case valuation of 143,413 won per share (10.2 trillion won market cap). In other words, we believe many institutional investors may be looking to take some partial profits in the first two days of trading at about 200,000 won level. 

SK IET: Trading Strategy Post IPO Pricing

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

<p>The review period 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> June review ends on 30 April. The Korea Exchange (KRX) will announce the results of the June 2021 review of 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> in May with the changes becoming effective after the close of trading on 10 June.</p><p>There are currently 201 index constituents following the spin off of <a href="https://www.smartkarma.com/entities/daelim-industrial-co-ltd" target="_blank" data-smartkarma-citation="entities:18095:1" rel="noopener">DL Co Ltd (000210 KS)</a> and the inclusion of <a href="https://www.smartkarma.com/entities/dl-e-c-co-ltd" target="_blank" data-smartkarma-citation="entities:31375:1" rel="noopener">DL E&amp;C Co Ltd (375500 KS)</a> in the index. There will be 202 index constituents following the spin off of <a href="https://www.smartkarma.com/entities/lg-corp" target="_blank" data-smartkarma-citation="entities:6653:1" rel="noopener">LG Corp (003550 KS)</a> and the inclusion of LX Holdings in the index.</p><p>We currently see 3 inclusions and 5 exclusions from the index. The potential inclusions are <a href="https://www.smartkarma.com/entities/hyosung-tnc-co-ltd" target="_blank" data-smartkarma-citation="entities:27749:1" rel="noopener">Hyosung TNC Co Ltd (298020 KS)</a>, <a href="https://www.smartkarma.com/entities/hyosung-advanced-materials-corporation" target="_blank" data-smartkarma-citation="entities:27751:1" rel="noopener">Hyosung Advanced Materials (298050 KS)</a> and <a href="https://www.smartkarma.com/entities/dongwon-industries-co-ltd" target="_blank" data-smartkarma-citation="entities:1783:1" rel="noopener">Dongwon Industries (006040 KS)</a>, while the potential deletions are <a href="https://www.smartkarma.com/entities/taeyoung-engineering-construction-co-ltd" target="_blank" data-smartkarma-citation="entities:18740:1" rel="noopener">Taeyoung Engineering &amp; Construction (009410 KS)</a>, <a href="https://www.smartkarma.com/entities/namsun-aluminum-co-ltd" target="_blank" data-smartkarma-citation="entities:17514:1" rel="noopener">Namsun Aluminum (008350 KS)</a>, <a href="https://www.smartkarma.com/entities/binggrae-co-ltd" target="_blank" data-smartkarma-citation="entities:16424:1" rel="noopener">Binggrae Co Ltd (005180 KS)</a>, <a href="https://www.smartkarma.com/entities/hanil-hyundai-cement-co-ltd" target="_blank" data-smartkarma-citation="entities:14406:1" rel="noopener">Hanil Hyundai Cement (006390 KS)</a> and <a href="https://www.smartkarma.com/entities/samyang-corp" target="_blank" data-smartkarma-citation="entities:16321:1" rel="noopener">Samyang Corp (145990 KS)</a>. </p><p>The expected Fast Entry of <a href="https://www.smartkarma.com/entities/sk-bioscience-co-ltd" target="_blank" data-smartkarma-citation="entities:31484:1" rel="noopener">SK Bioscience (302440 KS)</a> could result in <a href="https://www.smartkarma.com/entities/spc-samlip" target="_blank" data-smartkarma-citation="entities:6007:1" rel="noopener">SPC Samlip (005610 KS)</a> being deleted from the index.</p><p>The potential Fast Entry of <a href="https://www.smartkarma.com/entities/sk-ie-technology" target="_blank" data-smartkarma-citation="entities:29207:1" rel="noopener">SK IE Technology (SKIET KS)</a> could result in <a href="https://www.smartkarma.com/entities/aekyung-industrial-co-ltd" target="_blank" data-smartkarma-citation="entities:27129:1" rel="noopener">Aekyung Industrial Co Ltd (018250 KS)</a> being deleted from the index.</p><p><a href="https://www.smartkarma.com/entities/taihan-electric-wire-co-ltd" target="_blank" data-smartkarma-citation="entities:11551:1" rel="noopener">Taihan Electric Wire (001440 KS)</a> is a very close add - the next 5 trading days will decide if the stock is added to the index or not.</p><p>Short selling in Korea is scheduled to resume on 3 May and there could be a fair amount of movement in the stocks ahead of the index review announcement and implementation date.</p>

The review period for the Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX) June review ends on 30 April. The Korea Exchange (KRX) will announce the results of the June 2021 review of the Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX) in May with the changes becoming effective after the close of trading on 10 June.There are currently 201 index constituents following the spin off of DL Co Ltd (000210 KS) and the inclusion of DL E&amp;C Co Ltd (375500 KS) in the index. There will be 202 index constituents following the spin off of LG Corp (003550 KS) and the inclusion of LX Holdings in the index.We currently see 3 inclusions and 5 exclusions from the index. The potential inclusions are Hyosung TNC Co Ltd (298020 KS), Hyosung Advanced Materials (298050 KS) and Dongwon Industries (006040 KS), while the potential deletions are Taeyoung Engineering &amp; Construction (009410 KS), Namsun Aluminum (008350 KS), Binggrae Co Ltd (005180 KS), Hanil Hyundai Cement (006390 KS) and Samyang Corp (145990 KS). The expected Fast Entry of SK Bioscience (302440 KS) could result in SPC Samlip (005610 KS) being deleted from the index.The potential Fast Entry of SK IE Technology (SKIET KS) could result in Aekyung Industrial Co Ltd (018250 KS) being deleted from the index.Taihan Electric Wire (001440 KS) is a very close add - the next 5 trading days will decide if the stock is added to the index or not.Short selling in Korea is scheduled to resume on 3 May and there could be a fair amount of movement in the stocks ahead of the index review announcement and implementation date.

KOSPI200 Index Rebalance Preview: Review Period Almost Complete; Short Selling Commences in a Week

<p>It seems to be spin-off season in Korea.</p><p>Three <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> and <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> constituents will be suspended from trading from 29 April - <a href="https://www.smartkarma.com/entities/lg-corp" target="_blank" data-smartkarma-citation="entities:6653:1" rel="noopener">LG Corp (003550 KS)</a>, <a href="https://www.smartkarma.com/entities/f-f-co-ltd" target="_blank" data-smartkarma-citation="entities:15983:1" rel="noopener">F&amp;F Co Ltd (007700 KS)</a> and <a href="https://www.smartkarma.com/entities/ecopro-co-ltd" target="_blank" data-smartkarma-citation="entities:19029:1" rel="noopener">Ecopro Co Ltd (086520 KS)</a> due to a spin-off of its businesses.</p><p><a href="https://www.smartkarma.com/entities/f-f-co-ltd" target="_blank" data-smartkarma-citation="entities:15983:1" rel="noopener">F&amp;F Co Ltd (007700 KS)</a> will resume trading on 21 May, <a href="https://www.smartkarma.com/entities/lg-corp" target="_blank" data-smartkarma-citation="entities:6653:1" rel="noopener">LG Corp (003550 KS)</a> will resume trading on 27 May, and <a href="https://www.smartkarma.com/entities/ecopro-co-ltd" target="_blank" data-smartkarma-citation="entities:19029:1" rel="noopener">Ecopro Co Ltd (086520 KS)</a> will resume trading on 28 May.</p><p><a href="https://www.smartkarma.com/entities/lg-corp" target="_blank" data-smartkarma-citation="entities:6653:1" rel="noopener">LG Corp (003550 KS)</a> will remain in 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> and its spinoff will be added to the index, <a href="https://www.smartkarma.com/entities/f-f-co-ltd" target="_blank" data-smartkarma-citation="entities:15983:1" rel="noopener">F&amp;F Co Ltd (007700 KS)</a> will remain in 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> but the spinoff will not be added to the index, <a href="https://www.smartkarma.com/entities/ecopro-co-ltd" target="_blank" data-smartkarma-citation="entities:19029:1" rel="noopener">Ecopro Co Ltd (086520 KS)</a> will continue to be a <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> constituent though its spinoff will not be included in the index.</p><p>In this Insight, we look at the index treatment, the impact of passive flow on the stocks, and the impact of the changes on the June rebalance of 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>. </p>

It seems to be spin-off season in Korea.Three Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX) and KOSDAQ 150 Index (KOSDQ150 INDEX) constituents will be suspended from trading from 29 April - LG Corp (003550 KS), F&amp;F Co Ltd (007700 KS) and Ecopro Co Ltd (086520 KS) due to a spin-off of its businesses.F&amp;F Co Ltd (007700 KS) will resume trading on 21 May, LG Corp (003550 KS) will resume trading on 27 May, and Ecopro Co Ltd (086520 KS) will resume trading on 28 May.LG Corp (003550 KS) will remain in the Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX) and its spinoff will be added to the index, F&amp;F Co Ltd (007700 KS) will remain in the Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX) but the spinoff will not be added to the index, Ecopro Co Ltd (086520 KS) will continue to be a KOSDAQ 150 Index (KOSDQ150 INDEX) constituent though its spinoff will not be included in the index.In this Insight, we look at the index treatment, the impact of passive flow on the stocks, and the impact of the changes on the June rebalance of the Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX). 

<p>Late last year, the Korea FSC introduced an equal allocation for retail in an IPO at 50% of the total retail offering, but still with another 50% through proportional allocation on deposits.</p><p>SK Bioscience IPO proceeded under this rule, thus having a considerably lower retail subscription (335.1 to 1) than the previous big IPOs: HYBE (607. 0 to 1) and Kakao Games (323.0 to 1).</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td style="width: 197.5px;" data-sheets-value='{"1":2,"2":"Name"}'>Name</td>
<td style="text-align: right; width: 62.5px;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right; width: 71.6667px;" data-sheets-value='{"1":2,"2":"IPO date"}'>IPO date</td>
<td style="text-align: right; width: 64.1667px;" data-sheets-value='{"1":2,"2":"Offering price"}'>Offering price</td>
<td style="text-align: right; width: 64.1667px;" data-sheets-value='{"1":2,"2":"Offering size (₩B)"}'>Offering size (₩B)</td>
<td style="text-align: right; width: 65px;" data-sheets-value='{"1":2,"2":"Bookbuilding"}'>Book-building</td>
<td style="text-align: right; width: 74.1667px;" data-sheets-value='{"1":2,"2":"IPO retail subscription"}'>IPO retail subscription</td>
</tr>
<tr>
<td style="width: 197.5px;" data-sheets-value='{"1":2,"2":"SK Bioscience Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[1], "name")'>SK Bioscience Co Ltd</td>
<td style="text-align: right; width: 62.5px;" data-sheets-value='{"1":2,"2":"302440"}' data-sheets-formula='="302440"'>302440</td>
<td style="text-align: right; width: 71.6667px;" data-sheets-value='{"1":2,"2":"2021.03.18"}'>2021.03.18</td>
<td style="text-align: right; width: 64.1667px;" data-sheets-value='{"1":3,"3":65000}'>65,000</td>
<td style="text-align: right; width: 64.1667px;" data-sheets-value='{"1":3,"3":1491.8}' data-sheets-numberformat='{"1":2,"2":"#,##0.0","3":1}'>1,491.8</td>
<td style="text-align: right; width: 65px;" data-sheets-value='{"1":3,"3":1274.5}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>1,274.50</td>
<td style="text-align: right; width: 74.1667px;" data-sheets-value='{"1":3,"3":335.36}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>335.36</td>
</tr>
<tr>
<td style="width: 197.5px;" data-sheets-value='{"1":2,"2":"Hybe Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[1], "name")'>HYBE Co Ltd</td>
<td style="text-align: right; width: 62.5px;" data-sheets-value='{"1":2,"2":"352820"}' data-sheets-formula='="352820"'>352820</td>
<td style="text-align: right; width: 71.6667px;" data-sheets-value='{"1":2,"2":"2020.10.15"}'>2020.10.15</td>
<td style="text-align: right; width: 64.1667px;" data-sheets-value='{"1":3,"3":135000}'>135,000</td>
<td style="text-align: right; width: 64.1667px;" data-sheets-value='{"1":3,"3":962.6}' data-sheets-numberformat='{"1":2,"2":"#,##0.0","3":1}'>962.6</td>
<td style="text-align: right; width: 65px;" data-sheets-value='{"1":3,"3":1117}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>1,117.00</td>
<td style="text-align: right; width: 74.1667px;" data-sheets-value='{"1":3,"3":607}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>607.00</td>
</tr>
<tr>
<td style="width: 197.5px;" data-sheets-value='{"1":2,"2":"Kakao Games Corp"}' data-sheets-formula='=googlefinance(R[0]C[1], "name")'>Kakao Games Corp</td>
<td style="text-align: right; width: 62.5px;" data-sheets-value='{"1":2,"2":"293490"}' data-sheets-formula='="293490"'>293490</td>
<td style="text-align: right; width: 71.6667px;" data-sheets-value='{"1":2,"2":"2020.09.10"}'>2020.09.10</td>
<td style="text-align: right; width: 64.1667px;" data-sheets-value='{"1":3,"3":24000}'>24,000</td>
<td style="text-align: right; width: 64.1667px;" data-sheets-value='{"1":3,"3":384}' data-sheets-numberformat='{"1":2,"2":"#,##0.0","3":1}'>384.0</td>
<td style="text-align: right; width: 65px;" data-sheets-value='{"1":3,"3":1478.5}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>1,478.50</td>
<td style="text-align: right; width: 74.1667px;" data-sheets-value='{"1":3,"3":1524.85}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>1,524.85</td>
</tr>
<tr>
<td style="width: 197.5px;" data-sheets-value='{"1":2,"2":"SK Biopharmaceuticals Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[1], "name")'>SK Biopharmaceuticals Co Ltd</td>
<td style="text-align: right; width: 62.5px;" data-sheets-value='{"1":2,"2":"326030"}' data-sheets-formula='="326030"'>326030</td>
<td style="text-align: right; width: 71.6667px;" data-sheets-value='{"1":2,"2":"2020.07.02"}'>2020.07.02</td>
<td style="text-align: right; width: 64.1667px;" data-sheets-value='{"1":3,"3":49000}'>49,000</td>
<td style="text-align: right; width: 64.1667px;" data-sheets-value='{"1":3,"3":959.3}' data-sheets-numberformat='{"1":2,"2":"#,##0.0","3":1}'>959.3</td>
<td style="text-align: right; width: 65px;" data-sheets-value='{"1":3,"3":835}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>835.00</td>
<td style="text-align: right; width: 74.1667px;" data-sheets-value='{"1":3,"3":323.02}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>323.02</td>
</tr>
<tr><td colspan="7" rowspan="1" style="width: 724.167px;" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><p><strong>Now, Korean regulators introduce further restrictions to ban multiple applications on the same name in an IPO. It has long been a common practice by local retail in retail-heavy IPOs. </strong></p><p>The Korea FSC had put out the legislative notice on the Capital Act amendment until April 20. The enactment is one month from the legislative notice.</p><p>So, the effective date should be May 20.</p><p>But due to the local brokerages' system preparation, the ban will likely be in place from late June.</p><p>Which one would be the first unlucky one to face the ban?</p><p>SK IE Technology seems fine. But those IPOs coming in July will likely be subject to the ban.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"IPOs"}'>Upcoming IPOs in Korea</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"OTC valuation (₩B)"}'>OTC valuation (₩B)</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Tentative IPO schedule"}'>Tentative IPO schedule</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"SK IE Technology"}'>SK IE Technology</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":7487.7}' data-sheets-numberformat='{"1":2,"2":"#,##0.0","3":1}'>7,487.7</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44317}' data-sheets-numberformat='{"1":5,"2":"mmmm yyyy","3":1}'>May 2021</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"SD Biosensor"}'><strong>SD Biosensor</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":8500}' data-sheets-numberformat='{"1":2,"2":"#,##0.0","3":1}'><strong>8,500.0</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44378}' data-sheets-numberformat='{"1":5,"2":"mmmm yyyy","3":1}'><strong>July 2021</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Iljin Composite Materials"}'><strong>Iljin Composite Materials</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1600}' data-sheets-numberformat='{"1":2,"2":"#,##0.0","3":1}'><strong>1,600.0</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44378}' data-sheets-numberformat='{"1":5,"2":"mmmm yyyy","3":1}'><strong>July 2021</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Kakao Bank"}'><strong>Kakao Bank</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":34000}' data-sheets-numberformat='{"1":2,"2":"#,##0.0","3":1}'><strong>34,000.0</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44378}' data-sheets-numberformat='{"1":5,"2":"mmmm yyyy","3":1}'><strong>July 2021</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Krafton"}'>Krafton</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":22000}' data-sheets-numberformat='{"1":2,"2":"#,##0.0","3":1}'>22,000.0</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"3Q 2021"}'>3Q 2021</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Hyundai Engineering"}'>Hyundai Engineering</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":8300}' data-sheets-numberformat='{"1":2,"2":"#,##0.0","3":1}'>8,300.0</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"4Q 2021"}'>4Q 2021</td>
</tr>
<tr><td colspan="3" rowspan="1" data-sheets-value='{"1":2,"2":"Source: eDaily &amp; 38.communications"}'>Source: eDaily &amp; 38.communications</td></tr>
</tbody>
</table>

Late last year, the Korea FSC introduced an equal allocation for retail in an IPO at 50% of the total retail offering, but still with another 50% through proportional allocation on deposits.SK Bioscience IPO proceeded under this rule, thus having a considerably lower retail subscription (335.1 to 1) than the previous big IPOs: HYBE (607. 0 to 1) and Kakao Games (323.0 to 1).











Name
Ticker
IPO date
Offering price
Offering size (₩B)
Book-building
IPO retail subscription


SK Bioscience Co Ltd
302440
2021.03.18
65,000
1,491.8
1,274.50
335.36


HYBE Co Ltd
352820
2020.10.15
135,000
962.6
1,117.00
607.00


Kakao Games Corp
293490
2020.09.10
24,000
384.0
1,478.50
1,524.85


SK Biopharmaceuticals Co Ltd
326030
2020.07.02
49,000
959.3
835.00
323.02

Source: DART

Now, Korean regulators introduce further restrictions to ban multiple applications on the same name in an IPO. It has long been a common practice by local retail in retail-heavy IPOs. The Korea FSC had put out the legislative notice on the Capital Act amendment until April 20. The enactment is one month from the legislative notice.So, the effective date should be May 20.But due to the local brokerages' system preparation, the ban will likely be in place from late June.Which one would be the first unlucky one to face the ban?SK IE Technology seems fine. But those IPOs coming in July will likely be subject to the ban.







Upcoming IPOs in Korea
OTC valuation (₩B)
Tentative IPO schedule


SK IE Technology
7,487.7
May 2021


SD Biosensor
8,500.0
July 2021


Iljin Composite Materials
1,600.0
July 2021


Kakao Bank
34,000.0
July 2021


Krafton
22,000.0
3Q 2021


Hyundai Engineering
8,300.0
4Q 2021

Source: eDaily &amp; 38.communications



Banning Multiple Applications for Subscriptions in IPO: Impacts on Early-Phase Profit-Taking Window

South Korea

SK IE Technology Co., Ltd operates as a material solution provider. The Company provides information material solutions, electronic materials solutions, and other products. SK IE Technology conducts businesses across worldwide.

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SK IE Technology (361610 KS)

SK IET Bookbuilding Data Checking

SK IE Technology bookbuilding results are out. This post checks the result data and finds some aspects that deserve our attention.

Sanghyun Park

SK IET: Trading Strategy Post IPO Pricing

SK IET announced its IPO book building results today. The IPO price of SK IET has been determined at 105,000 won.The demand was very strong at...

Douglas Kim

KOSPI200 Index Rebalance Preview: Review Period Almost Complete; Short Selling Commences in a Week

There could be up to 6 inclusions and 8 exclusions at the KOSPI200 index review in June. The inclusions could outperform the exclusions as short...

Brian Freitas

Korea Spin-Offs: Index Treatment

LG Corp, F&F and Ecopro will be suspended from trading on 29 April due to their spin offs. Passive funds will sell stock at the close on 28 April...

Brian Freitas

Banning Multiple Applications for Subscriptions in IPO: Impacts on Early-Phase Profit-Taking Window

Korean regulators ban multiple applications on the same name in an IPO. This post examines potential impacts on the early-phase profit-taking...

Sanghyun Park

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