Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

<ul>
<li>Caixin confirmed today that Arm had transferred its shares in its China JV to a special purpose vehicle which it owns together with Softbank, as the FT had initially flagged. </li>
<li>This could technically eliminate the obstacles to an audit for an IPO but we believe regulators would be remiss in allowing such a flimsy change to pass muster. </li>
<li>In addition, the move reeks of desperation for cash and Softbank’s typical disregard for prudence and the importance of due diligence to investors.</li>
</ul>


Caixin confirmed today that Arm had transferred its shares in its China JV to a special purpose vehicle which it owns together with Softbank, as the FT had initially flagged. 
This could technically eliminate the obstacles to an audit for an IPO but we believe regulators would be remiss in allowing such a flimsy change to pass muster. 
In addition, the move reeks of desperation for cash and Softbank’s typical disregard for prudence and the importance of due diligence to investors.


Softbank – Transfer of Arm China Shares Does Nothing But Raise Red Flags

Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

This month, we undertake a study of movements in the Lucror Analytics Risk Assessment (LARA) for issuers in the Lucror Asia HY index over the last five years. The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market.

  This month, we undertake a study of movements in the Lucror Analytics Risk Assessment (LARA) for issuers in the Lucror Asia HY index over the last five years.   The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market. 

Asia HY Monthly - LARA Transition Study - Lucror Analytics

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Event-Driven

<ul>
<li>Today morning, <a href="https://www.smartkarma.com/entities/housing-development-finance" target="_blank" data-smartkarma-citation="entities:252:1" rel="noopener">HDFC Limited (HDFC IN)</a> announced that it would merger with <a href="https://www.smartkarma.com/entities/hdfc-bank-ltd-4b6b7a92-9087-468d-9dbe-ab169e77f014" target="_blank" data-smartkarma-citation="entities:558:1" rel="noopener">HDFC Bank (HDFCB IN)</a>. </li>
<li>Investors have been asking the two companies about a possible merger for at least the past decade.</li>
<li>In this note, we talk about the background for the merger and why now.</li>
</ul>


Today morning, HDFC Limited (HDFC IN) announced that it would merger with HDFC Bank (HDFCB IN). 
Investors have been asking the two companies about a possible merger for at least the past decade.
In this note, we talk about the background for the merger and why now.


HDFC+HDFC Bank Merger - A Long Time Coming

Telco/Internet specialist

Kirk Boodry

Redex Research

<ul>
<li>Vision Fund's public portfolio dropped $18.6bn (-24%) in Q4. China concerns grabbed headlines but it was Asian names (Coupang, Grab) that drove losses</li>
<li>Public investments held at the parent level fell 41% (-$1.3bn), led by SoFi (-$862mn), Lemonade (-$189mn) and THG (-$147mn) </li>
<li>We expect that Softbank will also need to write down private investments although it is not clear just how far private valuations have tracked public changes</li>
</ul>


Vision Fund's public portfolio dropped $18.6bn (-24%) in Q4. China concerns grabbed headlines but it was Asian names (Coupang, Grab) that drove losses
Public investments held at the parent level fell 41% (-$1.3bn), led by SoFi (-$862mn), Lemonade (-$189mn) and THG (-$147mn) 
We expect that Softbank will also need to write down private investments although it is not clear just how far private valuations have tracked public changes


Softbank Group - Early Read on Q4 Portfolio Performance

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>
<a href="https://www.smartkarma.com/entities/razer-inc" target="_blank" data-smartkarma-citation="entities:24380:1" rel="noopener">Razer Inc (1337 HK)</a>'s Scheme Document flags the abolishment of the headcount test may become law ahead of the shareholder meeting. That is a game-changer. If true.</li>
<li>
<a href="https://www.smartkarma.com/entities/daiho-corp" target="_blank" data-smartkarma-citation="entities:19647:1" rel="noopener">Daiho Corp (1822 JP)</a> has announced a deal which is not quite what it looks like. This situation is kind of a governance disaster.</li>
<li>
<a href="https://www.smartkarma.com/entities/uniti-group-ltd" target="_blank" data-smartkarma-citation="entities:29042:1" rel="noopener">Uniti Group Ltd (UWL AU)</a> backs the revised Morrison/Brookfield tilt and severs ties with Macquarie</li>
</ul>



Razer Inc (1337 HK)'s Scheme Document flags the abolishment of the headcount test may become law ahead of the shareholder meeting. That is a game-changer. If true.

Daiho Corp (1822 JP) has announced a deal which is not quite what it looks like. This situation is kind of a governance disaster.

Uniti Group Ltd (UWL AU) backs the revised Morrison/Brookfield tilt and severs ties with Macquarie


Last Week in Event SPACE: Razer, Daiho, Uniti Group, Toshiba, Tabcorp, China Conch

Japan

SoftBank Group Corp provides telecommunication services.  The Company also operates ADSL (Asymmetric Digital Subscriber Line) and fiber optic high-speed Internet connection, e-Commerce businesses, and Internet based advertising and auction businesses.

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Softbank Group (ADR) (SFTBY US)

Softbank – Transfer of Arm China Shares Does Nothing But Raise Red Flags

Softbank's move to transfer Arm China stock to an SPC reeks of desperation for cash and its typical disregard for prudence and the importance of...

Mio Kato

Asia HY Monthly - LARA Transition Study - Lucror Analytics

This month, we undertake a study of movements in the Lucror Analytics Risk Assessment (LARA) for issuers in the Lucror Asia HY index over the...

Lucror Analytics

HDFC+HDFC Bank Merger - A Long Time Coming

Today morning, HDFC Limited (HDFC IN) announced that it would merger with HDFC Bank (HDFCB IN). The merger has been speculated about for at least a...

Sumeet Singh

Softbank Group - Early Read on Q4 Portfolio Performance

Portfolio losses were steep and may very well exceed the record quarterly erosion set in Q2 as well-known public losses are matched with private...

Kirk Boodry

Last Week in Event SPACE: Razer, Daiho, Uniti Group, Toshiba, Tabcorp, China Conch

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

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