Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

LG Energy Solution / Equity Capital Markets

In this insight, we provide an update on the LG Energy Solution IPO. There have been some concerns that this IPO could get delayed until next year. However, there are increasing signs that suggest that the IPO of LG Energy Solution could get completed as early as in December 2021 to February 2022. The <a href="https://finance.naver.com/news/news_read.naver?article_id=0003971386&amp;office_id=011&amp;mode=RANK&amp;typ=0" target="_blank" rel="noopener">local media</a> have mentioned that by the end of this month, the LG Chem could release a specific schedule of the IPO of LG Energy Solution. A main hurdle on this IPO has been the cost of battery recall by GM. The IPO of LG Energy Solution will be able to be completed only if there are clear amount of contributions that the LG Energy Solution has to pay to GM and there are clues that this could get cleared up when LG Chem announces its 3Q 2021 earnings on 25 October. LG Chem currently has a market cap of 54 trillion won ($45 billion). The local media have mentioned that the value of LG Energy Solution could be about <a href="https://biz.chosun.com/stock/stock_general/2021/06/08/AHPP333T65HO7MPBGLPMPSMS3Y/?utm_source=naver&amp;utm_medium=original&amp;utm_campaign=biz" target="_blank" rel="noopener">50 trillion won to 100 trillion won.</a>LG Energy Solution is expected to raise more than 10 trillion won in this IPO, which could make this the largest ever IPO in Korea.

In this insight, we provide an update on the LG Energy Solution IPO. There have been some concerns that this IPO could get delayed until next year. However, there are increasing signs that suggest that the IPO of LG Energy Solution could get completed as early as in December 2021 to February 2022. The local media have mentioned that by the end of this month, the LG Chem could release a specific schedule of the IPO of LG Energy Solution. A main hurdle on this IPO has been the cost of battery recall by GM. The IPO of LG Energy Solution will be able to be completed only if there are clear amount of contributions that the LG Energy Solution has to pay to GM and there are clues that this could get cleared up when LG Chem announces its 3Q 2021 earnings on 25 October. LG Chem currently has a market cap of 54 trillion won ($45 billion). The local media have mentioned that the value of LG Energy Solution could be about 50 trillion won to 100 trillion won.LG Energy Solution is expected to raise more than 10 trillion won in this IPO, which could make this the largest ever IPO in Korea. 

LG Energy Solution - The Biggest IPO in 2021 in Korea?

Founder & CEO Bond Angle, LLC, Bond Angle, LLC

Vicki Bryan

Founder & CEO Bond Angle, LLC

Bond Angle, LLC

Insightful commentary and analysis on bond markets and market movers, including financial, economic, and industry catalysts and management shenanigans. 

High yield market investment research

Credit

Tesla's third quarter deliveries topped 241,000, trouncing market consensus and my best case estimate.That said, it was an easy comp given new Model Y sales and new market expansions that didn't exist last year—as I expected. But how much of the beat was home grown?In any case, bigger numbers mean bigger numbers, so I have increased my estimates for third quarter revenue and profits.

Tesla's third quarter deliveries topped 241,000, trouncing market consensus and my best case estimate.That said, it was an easy comp given new Model Y sales and new market expansions that didn't exist last year—as I expected. But how much of the beat was home grown?In any case, bigger numbers mean bigger numbers, so I have increased my estimates for third quarter revenue and profits.

Tesla Reports Record Q3 Deliveries; Blow Out Quarter Secured

Latest News from the World’s Leading Innovators

Granite Bay Capital

An innovation focussed investment company

Granite Bay Capital is an innovation focussed investment company with a deep focus on the companies at the leading edge of innovation across major themes such as AI, ubiquitous computing, sustainability, automation and longevity.

Thematic (Sector/Industry)

<h2>Headline Developments</h2>Samsung (005930.KS) and Harvard University have published new research outlining the vision of copying the brain’s neuron wiring map into a 3D “neuromorphic” chip. The approach, outlined in this paper, aims to reverse engineer the brain by copying the synaptic connectivity map of the brain (below right) and pasting the map onto a high-density 3D solid-state memory network.

Headline DevelopmentsSamsung (005930.KS) and Harvard University have published new research outlining the vision of copying the brain’s neuron wiring map into a 3D “neuromorphic” chip. The approach, outlined in this paper, aims to reverse engineer the brain by copying the synaptic connectivity map of the brain (below right) and pasting the map onto a high-density 3D solid-state memory network.

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Cross Asset Strategy

Over 50% of allocations are in the US with the bulk of the remainder split between Japan, China &amp; HK and the major European nations.  The EMEA overweight is comprised mainly of the UK, Netherlands, France and Germany, with active managers running underweights in the US, China &amp; HK, Australia and Japan.UK allocations hover around their lowest levels in history, though managers remain stubbornly overweight compared to the MSCI AC World index.  A total of 62% of managers are overweight the UK at an average +1.88% above benchmark.  Global Value investors are approaching their largest ever overweight in UK stocks of 3.64% above benchmark.Another month, another slump in Japan exposure.  Average weights in Japan stand at an all-time low of 5.06% with 85.5% of funds exposed (another low). <a href="https://www.smartkarma.com/entities/sony-corp" target="_blank" data-smartkarma-citation="entities:563:1" rel="noopener">Sony Corp (6758 JP)</a> and <a href="https://www.smartkarma.com/entities/kddi-corp" target="_blank" data-smartkarma-citation="entities:639:1" rel="noopener">KDDI Corp (9433 JP)</a> are the most widely held stocks, with 23% and 21% of funds holding a position.Tech exposure is at record highs, though this is matched by a record underweight of -0.47%.  Indeed, the percentage of funds who are overweight technology has fallen to below 50% for the first time since the end of 2018, a sign that Global managers are tilting their portfolios away from Tech.German Industrials allocations have hit a 4-year high as more Global investors add exposure to the sector. <a href="https://www.smartkarma.com/entities/deutsche-post-ag" target="_blank" data-smartkarma-citation="entities:21608:1" rel="noopener">Deutsche Post AG (DPW GR)</a> and <a href="https://www.smartkarma.com/entities/siemens-ag" target="_blank" data-smartkarma-citation="entities:21713:1" rel="noopener">Siemens AG (SIE GR)</a> were the key stocks behind the move, with 4.2% and 2.4% of funds adding exposure over the last 6-months.Alibaba has seen closures by some of the larger holders in our analysis, led by American Funds Capital World Fund (-$1.1bn) and New Economy Fund (-$451m).  Though closures have dominated, selected funds have opened exposure during this period of volatility, including Invesco's Global Focus Fund and Liontrust's Global Income Fund.

Over 50% of allocations are in the US with the bulk of the remainder split between Japan, China &amp; HK and the major European nations.  The EMEA overweight is comprised mainly of the UK, Netherlands, France and Germany, with active managers running underweights in the US, China &amp; HK, Australia and Japan.UK allocations hover around their lowest levels in history, though managers remain stubbornly overweight compared to the MSCI AC World index.  A total of 62% of managers are overweight the UK at an average +1.88% above benchmark.  Global Value investors are approaching their largest ever overweight in UK stocks of 3.64% above benchmark.Another month, another slump in Japan exposure.  Average weights in Japan stand at an all-time low of 5.06% with 85.5% of funds exposed (another low). Sony Corp (6758 JP) and KDDI Corp (9433 JP) are the most widely held stocks, with 23% and 21% of funds holding a position.Tech exposure is at record highs, though this is matched by a record underweight of -0.47%.  Indeed, the percentage of funds who are overweight technology has fallen to below 50% for the first time since the end of 2018, a sign that Global managers are tilting their portfolios away from Tech.German Industrials allocations have hit a 4-year high as more Global investors add exposure to the sector. Deutsche Post AG (DPW GR) and Siemens AG (SIE GR) were the key stocks behind the move, with 4.2% and 2.4% of funds adding exposure over the last 6-months.Alibaba has seen closures by some of the larger holders in our analysis, led by American Funds Capital World Fund (-$1.1bn) and New Economy Fund (-$451m).  Though closures have dominated, selected funds have opened exposure during this period of volatility, including Invesco's Global Focus Fund and Liontrust's Global Income Fund.

Global Fund Positioning Update:  Japan Lows, US Highs, UK Value Rotation, Tencent & Alibaba Exit

Chief Economist

Diana Choyleva

Enodo Economics

Enodo Economics is an independent macroeconomic forecasting company that untangles complexity, challenges the consensus, and makes sense of the future. Our focus is on China – one of the most misunderstood economies in the world, but one of the most important to figure out.  Enodo’s chief economist, Diana Choyleva, has been analysing China for almost 20 years, while Enodo’s team boasts a combined 140 years’ experience covering China’s economy, politics and markets. 

Macroeconomics

<h2>China News That Matters</h2><ul>
<li>Teetering and headline-making</li>
<li>Xi keeps eyes on party prize</li>
<li>Last call for coal? Xi won’t dig more overseas </li>
<li>US steps to counter China</li>
<li>Hong Kong feels the squeeze</li>
</ul><div class="content-remarks"><ul style="list-style-type: none;"><li><div>In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.</div></li></ul></div>

China News That Matters
Teetering and headline-making
Xi keeps eyes on party prize
Last call for coal? Xi won’t dig more overseas 
US steps to counter China
Hong Kong feels the squeeze
In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.

United States

Tesla Inc. operates as a multinational automotive and clean energy company. The Company designs and manufactures electric vehicles, battery energy storage from home to grid-scale, solar panels and solar roof tiles, and related products and services. Tesla owns its sales and service network and sells electric power train components to other automobile manufacturers.

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Tesla (TSLA US)

LG Energy Solution - The Biggest IPO in 2021 in Korea?

In this insight, we provide an update on the LG Energy Solution IPO. There are increasing signs that the IPO of LG Energy Solution could get...

Douglas Kim

Tesla Reports Record Q3 Deliveries; Blow Out Quarter Secured

Q3 deliveries topped 241,000, trouncing market consensus & my best case estimate. It was an easy comp vs weak results last yr on new model & market...

Vicki Bryan

Weekly Innovation Review (WIRE) #51

Samsung (005930.KS) and Harvard University have published new research outlining the vision of copying the brain’s neuron...

Granite Bay Capital

Global Fund Positioning Update: Japan Lows, US Highs, UK Value Rotation, Tencent & Alibaba Exit

A detailed look at investor positioning among 380 active Global strategies, covering the major themes in country, sector and stock exposure.

Steven Holden

Evergrande/ Xi/ Coal/ USA/ Hong Kong

In my weekly digest, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and...

Diana Choyleva

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