Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/furuya-metal-co-ltd" target="_blank" data-smartkarma-citation="entities:5196:1" rel="noopener">Furuya Metal (7826 JP)</a> and <a href="https://www.smartkarma.com/entities/visional-inc" target="_blank" data-smartkarma-citation="entities:32977:1" rel="noopener">Visional (4194 JP)</a> are expected to be included in the TOPIX index at the end of January 2024. </li>
<li>
<a href="https://www.smartkarma.com/entities/wilmar-international-ltd" target="_blank" data-smartkarma-citation="entities:172:1" rel="noopener">Wilmar International (WIL SP)</a>'s current implied stub and simple ratio (Wilmar/ <a href="https://www.smartkarma.com/entities/yihai-kerry-arawana-holdings-c" target="_blank" data-smartkarma-citation="entities:33230:1" rel="noopener">Yihai Kerry Arawana Holdings (300999 CH)</a>) are both at all-time highs.</li>
<li>Reportedly, the mother and two sisters of <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a> Chairman Jay Y. Lee plan to sell shares in a block deal worth ~₩2.8tn ($2.1bn billion.</li>
</ul>



Furuya Metal (7826 JP) and Visional (4194 JP) are expected to be included in the TOPIX index at the end of January 2024. 

Wilmar International (WIL SP)'s current implied stub and simple ratio (Wilmar/ Yihai Kerry Arawana Holdings (300999 CH)) are both at all-time highs.
Reportedly, the mother and two sisters of Samsung Electronics (005930 KS) Chairman Jay Y. Lee plan to sell shares in a block deal worth ~₩2.8tn ($2.1bn billion.


Last Week in Event SPACE: Furuya Metal, Visional, Wilmar, Samsung Electronics, ViinFast/Vingroup

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

<ul>
<li>Since the US$4.0 billion secondary placement announcement, <a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso Corp (6902 JP)</a>’s shares are down 4.3% from the undisturbed price of JPY2,298 per share (28 November).</li>
<li>Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Denso’s shares have followed the pattern of previous large placements.</li>
<li>The offering will likely be priced on 13 December. Investors participating in previous large Japanese placements tend to secure positive returns.</li>
</ul>


Since the US$4.0 billion secondary placement announcement, Denso Corp (6902 JP)’s shares are down 4.3% from the undisturbed price of JPY2,298 per share (28 November).
Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Denso’s shares have followed the pattern of previous large placements.
The offering will likely be priced on 13 December. Investors participating in previous large Japanese placements tend to secure positive returns.


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 were a lot of rebalance implementations in China on Friday, plus a few upcoming index changes that were announced during the week.</li>
<li>There are a lot of implementations this week, with <a href="https://www.smartkarma.com/entities/korea-stock-exchange-kospi-200" target="_blank" data-smartkarma-citation="entities:26021:1" rel="noopener">KOSPI 200</a> and <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ 150</a> on Thursday and then others across a bunch of countries on Friday.</li>
<li>There were big inflows to <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> during the week taking units outstanding to a new high. ETF inflows continue even as the market drops.</li>
</ul>


There were a lot of rebalance implementations in China on Friday, plus a few upcoming index changes that were announced during the week.
There are a lot of implementations this week, with KOSPI 200 and KOSDAQ 150 on Thursday and then others across a bunch of countries on Friday.
There were big inflows to Tracker Fund of Hong Kong (2800 HK) during the week taking units outstanding to a new high. ETF inflows continue even as the market drops.


Index Rebalance & ETF Flow Recap: NKY, TW Div+, ASX200, NZX50, Mom30, Top10EW, MVW, Rakuten Bank

<ul>
<li>The review period for the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a> March rebalance ends end January. There could be three changes at the rebalance with sector balance in focus.</li>
<li>Depending on the changes, passives trackers will need to buy 2.4-22.5x ADV (10-24% of real float) on the inclusions and sell between 3.5-42.5x ADV on the deletions.</li>
<li>
<a href="https://www.smartkarma.com/entities/fast-retailing-co-ltd" target="_blank" data-smartkarma-citation="entities:751:1" rel="noopener">Fast Retailing (9983 JP)</a> capping, <a href="https://www.smartkarma.com/entities/nitori-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:20386:1" rel="noopener">Nitori Holdings (9843 JP)</a> increase in PAF, a big funding trade, and potentially new stocks being added in two-steps. </li>
</ul>


The review period for the Nikkei 225 (NKY INDEX) March rebalance ends end January. There could be three changes at the rebalance with sector balance in focus.
Depending on the changes, passives trackers will need to buy 2.4-22.5x ADV (10-24% of real float) on the inclusions and sell between 3.5-42.5x ADV on the deletions.

Fast Retailing (9983 JP) capping, Nitori Holdings (9843 JP) increase in PAF, a big funding trade, and potentially new stocks being added in two-steps. 


Nikkei 225 Index Rebalance Preview (Mar 2024): Update on Ranking, Capping, Funding & Other Changes

Travis Lundy

<ul>
<li>Minimal changes in the rankings since last time. Socionext (6526), Disco (6146), and a Consumer Goods stock (Zozo (3092) top-ranked, Ryohin Keikaku (7453) a better choice) are ADDs.</li>
<li>The DELETEs are still Takara Holdings (2531), Pacific Metals (5541), Sumitomo Osaka Cement (5232) with a dark horse candidate in Hitachi Zosen (7004) to replace Takara.</li>
<li>There is the upweight to Nitori (9843) AND funkiness with Fast Retailing (9983) to consider. We are right on the threshold. The question is whether it gets "help" in January.</li>
</ul>


Minimal changes in the rankings since last time. Socionext (6526), Disco (6146), and a Consumer Goods stock (Zozo (3092) top-ranked, Ryohin Keikaku (7453) a better choice) are ADDs.
The DELETEs are still Takara Holdings (2531), Pacific Metals (5541), Sumitomo Osaka Cement (5232) with a dark horse candidate in Hitachi Zosen (7004) to replace Takara.
There is the upweight to Nitori (9843) AND funkiness with Fast Retailing (9983) to consider. We are right on the threshold. The question is whether it gets "help" in January.


March 2024 Nikkei 225 Rebal - Socionext, Disco, and a Consumer Goods Stock to ADD and ¥1trn To Trade

Japan

Socionext Inc. designs, develops, and provides SoC (system on chip) solutions and services. The Company offers digital broadcast demodulation solution, video interface conversion solution, imaging solution, engine and accelerator solution, industrial connected solution, and more. Socionext serves customers in consumer, automotive, industrial, and other fields.

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Socionext (6526 JP)

Last Week in Event SPACE: Furuya Metal, Visional, Wilmar, Samsung Electronics, ViinFast/Vingroup

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Denso (6902 JP): The Current Playbook

The shares are down 4.3% since announcing the offering, which will likely be priced on 13 December. Investors participating in previous large...

Arun George

Index Rebalance & ETF Flow Recap: NKY, TW Div+, ASX200, NZX50, Mom30, Top10EW, MVW, Rakuten Bank

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

Brian Freitas

Nikkei 225 Index Rebalance Preview (Mar 2024): Update on Ranking, Capping, Funding & Other Changes

There could be 3 changes at the March rebal. Socionext moves up the add list following the stock split. Fast Retailing is back above 11% index...

Brian Freitas

March 2024 Nikkei 225 Rebal - Socionext, Disco, and a Consumer Goods Stock to ADD and ¥1trn To Trade

The March 2024 Nikkei 225 Rebalance is aiming at JPY 1 trillion to trade. The big one to the buy side is Disco (6146) but there are several large...

Travis Lundy

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