Smartkarma Daily Briefs

There are 12 changes for the CSI 300 Index (SHSZ300 INDEX) and 50 changes for the CSI Smallcap 500 Index (SH000905 INDEX) in June. Most changes were expected.
There are a lot of stocks with over 1 day of ADV to trade. The round-trip trade in June is estimated to be US$5bn.
The adds have outperformed the deletes for both indices but the return profile of a long adds/ short deletes trade for the CSI500 Index is a lot smoother.

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Jun 03

Daily Brief Industrials: Hanwha Ocean , APM Human Services, Cosco Shipping Energy Transportation Co. Ltd. (H), Adani Ports & Special Economic Zone, Array Technologies and more

By Smartkarma Daily Briefs | Daily Briefs, Industrials

In today’s briefing:

Hanwha Ocean’s June 22 Release of a 1.68% Stake Grabs Local Market Attention
Madison Dearborn Takes APM Back Into The Fold
COSCO Shipping Energy (1138 HK): Don’t Get Carried Away
Morning Views Asia: Adani Ports & Special Economic Zone
Array Technologies Inc (ARRY) – Sunday, Mar 3, 2024

Hanwha Ocean’s June 22 Release of a 1.68% Stake Grabs Local Market Attention

By Sanghyun Park

The June 22 lock-up release, involving a 1.68% stake by Eximbank, is drawing attention, with concerns these shares might hit the market immediately, impacting prices significantly.
Eximbank is likely to sell its shares quickly post-lock-up, fueling speculation and potential market reactions, as their focus is on financial stability, not long-term holdings.
The 1.68% block deal could significantly impact Hanwha Ocean’s price, similar to last year’s 6.4% drop after a smaller block deal announcement by the Korean Financial Services Commission.

Madison Dearborn Takes APM Back Into The Fold

APM Human Services (APM AU) and US PE-outfit Madison Dearborn Partners, holding ~30%, have entered a Scheme at A$1.45/share, in cash.
That’s a 74.7% premium to undisturbed; and a $0.05/share increase over Madison Dearborn’s April 8th A$1.40/share NBIO, a price the Independent Board Committee (IBC) previously considered disappointing.
A scrip option is afforded, and Executive Chair, Megan Wynne and CEO, Michael Anghie will take up that option if the Scheme is implemented. The IBC is supportive.

COSCO Shipping Energy (1138 HK): Don’t Get Carried Away

By Osbert Tang, CFA

Cosco Shipping Energy Transp. Co. Ltd. (H) (1138 HK)‘s 1.25x 12-month forward P/B is more than 2SD above historical average. Though earnings have improved, this still appears rich.
The market expects this upcycle will sustain for at least 5 years, but as a cyclical stock, CSET has never had such a long cycle in the last 10 years.
While VLCC rate has gained 36% YTD, the average for FY24 is just in line with 2H22 and 1H23. However, earnings projections are 57% higher than that time.

Morning Views Asia: Adani Ports & Special Economic Zone

By Leonard Law, CFA

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

Adani Ports & Special Economic Zone

Array Technologies Inc (ARRY) – Sunday, Mar 3, 2024

By Value Investors Club

Array Technologies stock fell from $45 to below $13 based on Mason’s recommendation in December 2020
Mason advised exiting the position at $17 in August 2021 after improvements seen
Stock currently trading at $14 a share with potential for 50-60% upside to fair value as second largest global solar tracking company

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

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Jun 03

Daily Brief Financials: Bank of Communications , Guosen Securities , NIFTY Index, China Merchants China Direct Investments, Atour Lifestyle Holdings, Sompo Holdings, KE Holdings , Investor and more

By Smartkarma Daily Briefs | Daily Briefs, Financials

In today’s briefing:

SSE50/SSE180 Index Rebalance: Heavy Focus on Sector Balance
CSI All Share IB & Brokerage Index Rebalance: Couple of Large Flow & Impact Names
EQD / Weekly Vol Update / IVs Spike with Election Results Round the Corner
The Battle of CMCDI: What Is the Endgame?
[Atour Lifestyle (ATAT US, BUY, TP US$39) TP Change]: Should Retail Profit Be Accorded a Multiple?
ECM Weekly (3rd June 2024) – Shift Up, QuantumPharm, Telix, Sompo, ASMedia, Exedy, Barito, Zomato
[KE Holdings (BEKE US, BUY, TP US$21) TP Change]: New Stimulus Might Be Needed to Spur the Market
Selected European HoldCos and DLC: May’24 Report

SSE50/SSE180 Index Rebalance: Heavy Focus on Sector Balance

There are 5 changes for the SSE50 Index (SSE50 INDEX) that will be implemented at the close on 14 June. There is over 1x ADV to trade on most stocks.
The index committee has focused on sector balance with higher ranked stocks from the Financials sector ignored and lower ranked stocks from other sectors included.
The adds have outperformed the deletes over the last 6 months and positioning (especially on the surprises) could lead to further upside for a long/short trade.

CSI All Share IB & Brokerage Index Rebalance: Couple of Large Flow & Impact Names

The changes to the CSI All Share Investment Banking & Brokerage Index were announced after market close on 31 May and will be implemented at the close on 14 June.
Guosen Securities (002736 CH) will be added to the index while Northeast Securities (000686 CH) will be deleted from the index.
There is a lot of flow and impact for both stocks and the stocks could outperform/underperform their peers over the next couple of weeks.

EQD / Weekly Vol Update / IVs Spike with Election Results Round the Corner

By Sankalp Singh

IVs Spike with Election Results release on 04-June-2024. Post event there’s a risk of large IV-crush regardless of the result.
Current Vol-state is “High & Up”. Wait for the switch to “High & Down” before initiating new risk-premia harvesting strategies
Weekly IVs have received large markups due to elections. Entire Vol Curve is now in Backwardation – curve inversion at extreme levels

The Battle of CMCDI: What Is the Endgame?

By Alec Tseung

ASM is a hedge fund with a strong track record of investor activism in taking over distressed assets and closed-end funds.
Lazard, the second largest CMCDI shareholder, bought shares last week at a multi-year high sending a strong message to the market.
CMCDI can also explore announcing a discount management program besides agreeing to ASM’s claim to sell assets to pay dividends and offer a share buyback to reduce the NAV discount.

[Atour Lifestyle (ATAT US, BUY, TP US$39) TP Change]: Should Retail Profit Be Accorded a Multiple?

By Eric Wen

Atour reported C1Q23 revenue 4.6%/6.8% higher than our est./cons., and non-GAAP NI 6.9%/8.8% higher than our est./ cons, driven by hotel expansion and new retail products.
The company raised total revenue guidance from 30% to 40% YoY for 2024 due to a strong retail sales trend.
We believe retail sales is a form of increase in Atour’s same store sales. We thus raise TP to US$39 to reflect this retail-driven increase of same store sales.

ECM Weekly (3rd June 2024) – Shift Up, QuantumPharm, Telix, Sompo, ASMedia, Exedy, Barito, Zomato

By Sumeet Singh

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
On the IPO front, we undertook a peer comparison and looked at valuations for Shift Up (462870 KS).
On the placement front, it was another busy week with a number of blocks in India along with Asmedia Technology (5269 TT)‘s GDR offering and Exedy Corp (7278 JP).

[KE Holdings (BEKE US, BUY, TP US$21) TP Change]: New Stimulus Might Be Needed to Spur the Market

By Eric Wen

KE Holdings (BEKE) reported C1Q24 revenue/non-GAAP NI in-line/35% above consensus and guided a modest revenue growth of 10% YoY in C2Q24
We maintain our view that C1Q24 would be the trough as subsequent improvement, albeit at slower magnitude, should happen from C2Q24
We maintain the stock as BUY rating but lower TP to US$21 to reflect a postponed recovery schedule.

Selected European HoldCos and DLC: May’24 Report

By Jesus Rodriguez Aguilar

The Discounts to NAV of covered holdcos did not follow a clear trend during May. Discounts to NAV: C.F.Alba, 46.8% (vs. 49.1%); GBL, 42.9% (vs. 39%); Heineken Holding, 18.3% (vs. 17.3%);
Industrivärden C, 2.5% (vs. 4.7%); Investor B, 12% (vs. 8.3%); Porsche Automobile Holding, 35.3% (vs. 41.1%). Rio DLC spread widened to 23% (vs. 22.5%).
What seems interesting: Porsche SE vs. listed assets and the Rio DLC (long RIO LN/short RIO AU).

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Jun 03

Daily Brief Consumer: Star Entertainment Group, SHEIN, TSE Tokyo Price Index TOPIX, Deckers Outdoor, Aisin , Vf Corp, Ralph Lauren, elf Beauty Inc, Target Corp, BJ’s Wholesale Club Holdings and more

By Smartkarma Daily Briefs | Consumer, Daily Briefs

In today’s briefing:

Tax-Loss Selling in Australia 2024 – The May Basket (April Basket +2.3 to +6.3% Rtn)
SHEIN: Several US Customs Broker Suspensions Tied to Tighter ‘de Minimis’ Rules
Engagement Keeps Widening the Profitability Gap Between the Top and Bottom Companies in Market Cap
Deckers Outdoor Corporation: These Are The 5 Fundamental Factors Driving Its Performance! – Financial Forecasts
Aisin – 141% Profit Growth, With Future to Have More Sales for Electric and Hybrid Vehicles
V.F. Corporation: Expansion of Direct-to-Consumer (DTC) Channel & Other Major Drivers
Ralph Lauren Corporation: Will Its Focus on Direct-to-Consumer (DTC) Channel Growth Especially In Asia Pay Off? – Major Drivers
e.l.f. Beauty Inc.: Will The Strong Growth in Sales and Market Share Last? – Major Drivers
Target Corporation: How Is The Continuing Growth In Private Labels Expected To Impact The Top-Line? – Major Drivers
BJ’s Wholesale Club Holdings: Expanding Locations & Membership Base & Other Major Drivers

Tax-Loss Selling in Australia 2024 – The May Basket (April Basket +2.3 to +6.3% Rtn)

I am not a tax advisor and I do not play one on TV but it is a subject of interest in Australia, as an AFR article from June 2022 shows.
The general gist: retail investors in Australia will take gains on stocks which run up in price, or get taken over, then look for losses to offset.
The portfolio worked well in April. Now we let April ride and add the May basket.

SHEIN: Several US Customs Broker Suspensions Tied to Tighter ‘de Minimis’ Rules

By Daniel Hellberg

Several US customs brokers have been suspended under new, tighter rules
The new rules could make ‘de minimis’ imports slightly more difficult
Whether it lists in London or NYC, additional rule changes could threaten SHEIN

Engagement Keeps Widening the Profitability Gap Between the Top and Bottom Companies in Market Cap

By Aki Matsumoto

Companies with larger market capitalizations tend to have higher profitability and valuations, and those companies have higher foreign ownership.
Given that board practices improved and that valuations, highly correlated with foreign ownership, are higher for companies with larger market capitalizations, this can be due to engagement of overseas investors.
If this hypothesis is correct, the gap between the top and bottom market capitalization companies will widen further as it takes a certain time for engagement to pay off.

Deckers Outdoor Corporation: These Are The 5 Fundamental Factors Driving Its Performance! – Financial Forecasts

In the fourth quarter fiscal of 2024, Deckers Brands achieved record revenue growth of 18% compared to the previous year, almost reaching $4.3 billion of annual revenue.
Gross margin increased by a considerable 530 basis points from last year to 55.6%, and earnings per share rose by 51% to $29.16.
These results reflect Deckers’ successful long-term strategies and the hard work of its employees.

Aisin – 141% Profit Growth, With Future to Have More Sales for Electric and Hybrid Vehicles

By Daniel Tabbush

Aisin is already achieving strong growth, across many markets, and this should continue with more sales into EV and HEV markets
Financial strength is improving, with gearing moving lower, and debt/ebitda moving lower
Balance sheet clean up can lead to some volatility, but overall a general positive, as is the focus on capital management

V.F. Corporation: Expansion of Direct-to-Consumer (DTC) Channel & Other Major Drivers

From the Q4 2024 Earnings of VF Corporation, it can be inferred that the company is working on a transformation strategy named Reinvent to return to long-term growth.
The company seems to be undergoing significant changes both structurally and operationally.
Reinvent’s primary focus is on restructuring the U.S. business, cost base adjustment, and balance sheet enhancement.

Ralph Lauren Corporation: Will Its Focus on Direct-to-Consumer (DTC) Channel Growth Especially In Asia Pay Off? – Major Drivers

Based on the recent earnings, Ralph Lauren Corporation demonstrated credible fiscal performance despite the ongoing uncertainties of the global business climate.
The company remained resilient with the successful execution of its Next Great Chapter Accelerate plan.
On a positive note, President and CEO, Patrice Louvet, highlighted the progress made on several fronts.

e.l.f. Beauty Inc.: Will The Strong Growth in Sales and Market Share Last? – Major Drivers

e.l.f. Beauty reported a solid 2024 fiscal fourth quarter, hitting a significant milestone of over $1 billion in net sales.
The company grew net sales by 77%, exceeding expectations.
Q4 marked the 21st consecutive quarter of both net sales growth and market share gains.

Target Corporation: How Is The Continuing Growth In Private Labels Expected To Impact The Top-Line? – Major Drivers

Target Corporation reported its Q1 2024 financial results that were largely in line with its own expectations, while outlining various strategies and initiatives aimed at bolstering growth and profitability.
Despite the challenging economic environment and volatility in consumer spending patterns, Target remains resilient, with its profitability continuing to benefit from prudent cost management and ongoing investments in strategic growth initiatives.
However, softer trends in discretionary categories, particularly Home and Hardlines, may continue to pressure sales in the near term.

BJ’s Wholesale Club Holdings: Expanding Locations & Membership Base & Other Major Drivers

BJ’s Wholesale Club Holdings, Inc., an American wholesale club chain reported its first-quarter earnings for fiscal 2024.
The results from the call were mixed, with continued strong growth in membership fees and market share, supported by robust traffic and unit growth.
However, the team cautioned that the first quarter’s robust projections could be challenging given the previous year’s inflation dynamics.

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Jun 02

Daily Brief Thematic (Sector/Industry): Japan Weekly | Mixed Performance for Stocks; Tohoku Elec and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Japan Weekly | Mixed Performance for Stocks; Tohoku Elec, Miura, Kansai Paint

Japan Weekly | Mixed Performance for Stocks; Tohoku Elec, Miura, Kansai Paint

By Mark Chadwick

US stock markets showed mixed performance post long weekend, with the NASDAQ partially buoyed by Nvidia’s strength
Fed’s Kashkari suggested US rate hikes remain possible, contrasting with growing expectations for an ECB rate cut as early as next week
Japanese stocks were volatile last week. Tohoku Electric Power was the standout performer after announcing the completion of safety works at the Onagawa No. 2 nuclear reactor

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Jun 02

Daily Brief Event-Driven: (Mostly) Asia-Pac M&A: Huafa Prop and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

(Mostly) Asia-Pac M&A: Huafa Prop, Asia Cement, QV Equities, Sciclone, Chilled & Frozen Logistics
Weekly Deals Digest (02 Jun) – Infocom, CF Logistics, Asia Cement, GA Pack, Huafa, Shift Up
Last Week in Event SPACE: Mitsui Matsushima, China Merchants,Kansai Paint, Teijin, Sciclone Pharma
Mainland Connect NORTHBOUND Flows (To 31 May 2024): Net Sell Flows on Weak Gross Volumes
HK Connect SOUTHBOUND Flows (To 31 May 2024); Private Tech, Energy/Financial SOEs See BIG Net Buys
KWEB Index Rebalance: ZX (9890 HK) In; Fenbi (2469 HK) Out
(Mostly) Asia M&A, May 2024: Malaysia Airports, Alps Logistics, Nihon Housing, Great Eastern
Helios Techno Holding (6927) – Small TOB, Fat Premium (74%), Still Too Cheap
A/H Premium Tracker (To 31 May 2024): HK Stocks Have an Ugly Week; AH Premium in Liquid Pairs Rises

(Mostly) Asia-Pac M&A: Huafa Prop, Asia Cement, QV Equities, Sciclone, Chilled & Frozen Logistics

I tally 51 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
One new deal was discussed on Smartkarma this week:Huafa Property Services Group (982 HK)‘s Scheme. Asia Cement China (743 HK) also suspended pursuant to the Takeovers Code.
Key updates took place on: QV Equities (QVE AU), Boral (BLD AU), Greatview Aseptic Packaging (468 HK), Sciclone Pharmaceuticals (6600 HK), and Chilled & Frozen Logistics Holdings (9099 JP).

Weekly Deals Digest (02 Jun) – Infocom, CF Logistics, Asia Cement, GA Pack, Huafa, Shift Up

By Arun George

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments: Shift Up (462870 KS) seeks to raise up to US$320 million.
Event-Driven developments: Asia Cement China (743 HK), Greatview Aseptic Packaging (468 HK), Huafa Property Services Group (982 HK), Chilled & Frozen Logistics Holdings (9099 JP), Infocom Corp (4348 JP).

Last Week in Event SPACE: Mitsui Matsushima, China Merchants,Kansai Paint, Teijin, Sciclone Pharma

Colour me perplexed. Murakami Group ran up Mitsui Matsushima (1518 JP)‘s share price in acquiring 29%. The pattern was clear, but one assumes everyone in-group was on the same page.
Two activist shareholders. And long only upping its stake. Heavily discounted China Merchants China Direct Investments (133 HK) is in play.
A HUGE new buyback for Kansai Paint (4613 JP). Really big. Buy Kansai Paint vs Nippon Paint. One can buy the pop. One can buy any dips after the pop.

Mainland Connect NORTHBOUND Flows (To 31 May 2024): Net Sell Flows on Weak Gross Volumes

The Quiddity Mainland Connect NORTHBOUND Monitor. Like the A/H Premium Monitor and HK Connect SOUTHBOUND Monitor. Lots of Flows/Position Tables and Charts with which to play.
Last week saw NORTHBOUND net SELL RMB 5.7bn of A-shares on lower gross volumes. NORTHBOUND bought Zijin, Yangtze Power, and renewables and sold SOEs.
Ongoing questions as to whether the NORTHBOUND volumes to the buy side are all foreigners. Some suspect there is national team buying mixed in, as was expected from earlier announcements.

HK Connect SOUTHBOUND Flows (To 31 May 2024); Private Tech, Energy/Financial SOEs See BIG Net Buys

SOUTHBOUND was again a net buyer for HK$29.7bn on small two-way volumes. Bank Of China Ltd (H) (3988 HK) dropped to #4 this week but SOE buying dominated.
It is not clear how much of this is H/A discounts, expected dividend tax removal, and the KPIs for SOE CEOs to raise prices and payout ratios, but it continues.
Valuations are acceptable. Flows are good. Policy changes are afoot. SOUTHBOUND may continue to see inflows – national team and otherwise.

KWEB Index Rebalance: ZX (9890 HK) In; Fenbi (2469 HK) Out

ZX (9890 HK) will replace Fenbi Ltd (2469 HK) in the KraneShares CSI China Internet ETF (KWEB US) at the close on 14 June.
There will be over 6 days of ADV to sell in Fenbi Ltd (2469 HK) and we estimate over 2 days of ADV to buy in ZX (9890 HK).
There are other ETFs that track very similar indices and there could be a lot more to trade in the stocks at the close on 14 June.

(Mostly) Asia M&A, May 2024: Malaysia Airports, Alps Logistics, Nihon Housing, Great Eastern

For the month of May 2024, 10 new transactions (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$6.6bn.
The average premium for the new transactions announced (or first discussed) in May was ~60%. The average premium YTD is ~46%. Japan is well up yoy. Hong Kong is down.
This compares to the average premium for transactions in 2023 (117 transactions), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) of 39%, 41%, 33%, 31%, and 31% respectively.

Helios Techno Holding (6927) – Small TOB, Fat Premium (74%), Still Too Cheap

On Friday, acquisitive wafer technology firm Rs Technologies (3445 JP) announced it would buy lamp and printing equipment maker Helios Techno Holding (6927 JP) at a 74% premium.
The premium is big, but Helios is a steal at the price. Granted, it is a small potatoes steal.
The register is not controlled by any one party or group of investors other than retail. That makes this interesting.

A/H Premium Tracker (To 31 May 2024): HK Stocks Have an Ugly Week; AH Premium in Liquid Pairs Rises

The New/Better A-H Premium Tracker has tables, charts, measures galore to track A/H premium positioning, southbound and northbound positioning/volatility in pairs over time, etc.
SOUTHBOUND’s renewed buy streak continued this past week; every day net positive. Strong net buying. NORTHBOUND saw net selling. Gross volumes on both were light.
AH Premia rebounded off multi-year lows, on average, this past week as Hang Seng/other HK indices fell and A-shares did not do much. Liquid Hs underperformed As by 2%.

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Jun 02

Daily Brief Australia: BHP Group Ltd and more

By Smartkarma Daily Briefs | Australia, Daily Briefs

In today’s briefing:

(Mostly) Asia-Pac M&A: Huafa Prop, Asia Cement, QV Equities, Sciclone, Chilled & Frozen Logistics

(Mostly) Asia-Pac M&A: Huafa Prop, Asia Cement, QV Equities, Sciclone, Chilled & Frozen Logistics

I tally 51 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
One new deal was discussed on Smartkarma this week:Huafa Property Services Group (982 HK)‘s Scheme. Asia Cement China (743 HK) also suspended pursuant to the Takeovers Code.
Key updates took place on: QV Equities (QVE AU), Boral (BLD AU), Greatview Aseptic Packaging (468 HK), Sciclone Pharmaceuticals (6600 HK), and Chilled & Frozen Logistics Holdings (9099 JP).

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Jun 02

Daily Brief Singapore: Great Eastern Holdings and more

By Smartkarma Daily Briefs | Daily Briefs, Singapore

In today’s briefing:

(Mostly) Asia M&A, May 2024: Malaysia Airports, Alps Logistics, Nihon Housing, Great Eastern

(Mostly) Asia M&A, May 2024: Malaysia Airports, Alps Logistics, Nihon Housing, Great Eastern

For the month of May 2024, 10 new transactions (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$6.6bn.
The average premium for the new transactions announced (or first discussed) in May was ~60%. The average premium YTD is ~46%. Japan is well up yoy. Hong Kong is down.
This compares to the average premium for transactions in 2023 (117 transactions), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) of 39%, 41%, 33%, 31%, and 31% respectively.

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Jun 02

Daily Brief China: China Yangtze Power Co, Ltd., MINISO Group Holding , ZX, Xinjiang Goldwind Science & Technology and more

By Smartkarma Daily Briefs | China, Daily Briefs

In today’s briefing:

Mainland Connect NORTHBOUND Flows (To 31 May 2024): Net Sell Flows on Weak Gross Volumes
HK Connect SOUTHBOUND Flows (To 31 May 2024); Private Tech, Energy/Financial SOEs See BIG Net Buys
KWEB Index Rebalance: ZX (9890 HK) In; Fenbi (2469 HK) Out
A/H Premium Tracker (To 31 May 2024): HK Stocks Have an Ugly Week; AH Premium in Liquid Pairs Rises

Mainland Connect NORTHBOUND Flows (To 31 May 2024): Net Sell Flows on Weak Gross Volumes

The Quiddity Mainland Connect NORTHBOUND Monitor. Like the A/H Premium Monitor and HK Connect SOUTHBOUND Monitor. Lots of Flows/Position Tables and Charts with which to play.
Last week saw NORTHBOUND net SELL RMB 5.7bn of A-shares on lower gross volumes. NORTHBOUND bought Zijin, Yangtze Power, and renewables and sold SOEs.
Ongoing questions as to whether the NORTHBOUND volumes to the buy side are all foreigners. Some suspect there is national team buying mixed in, as was expected from earlier announcements.

HK Connect SOUTHBOUND Flows (To 31 May 2024); Private Tech, Energy/Financial SOEs See BIG Net Buys

SOUTHBOUND was again a net buyer for HK$29.7bn on small two-way volumes. Bank Of China Ltd (H) (3988 HK) dropped to #4 this week but SOE buying dominated.
It is not clear how much of this is H/A discounts, expected dividend tax removal, and the KPIs for SOE CEOs to raise prices and payout ratios, but it continues.
Valuations are acceptable. Flows are good. Policy changes are afoot. SOUTHBOUND may continue to see inflows – national team and otherwise.

KWEB Index Rebalance: ZX (9890 HK) In; Fenbi (2469 HK) Out

ZX (9890 HK) will replace Fenbi Ltd (2469 HK) in the KraneShares CSI China Internet ETF (KWEB US) at the close on 14 June.
There will be over 6 days of ADV to sell in Fenbi Ltd (2469 HK) and we estimate over 2 days of ADV to buy in ZX (9890 HK).
There are other ETFs that track very similar indices and there could be a lot more to trade in the stocks at the close on 14 June.

A/H Premium Tracker (To 31 May 2024): HK Stocks Have an Ugly Week; AH Premium in Liquid Pairs Rises

The New/Better A-H Premium Tracker has tables, charts, measures galore to track A/H premium positioning, southbound and northbound positioning/volatility in pairs over time, etc.
SOUTHBOUND’s renewed buy streak continued this past week; every day net positive. Strong net buying. NORTHBOUND saw net selling. Gross volumes on both were light.
AH Premia rebounded off multi-year lows, on average, this past week as Hang Seng/other HK indices fell and A-shares did not do much. Liquid Hs underperformed As by 2%.

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Jun 02

Daily Brief Japan: Infocom Corp, Mitsui Matsushima, Helios Techno Holding and more

By Smartkarma Daily Briefs | Daily Briefs, Japan

In today’s briefing:

Weekly Deals Digest (02 Jun) – Infocom, CF Logistics, Asia Cement, GA Pack, Huafa, Shift Up
Last Week in Event SPACE: Mitsui Matsushima, China Merchants,Kansai Paint, Teijin, Sciclone Pharma
Helios Techno Holding (6927) – Small TOB, Fat Premium (74%), Still Too Cheap

Weekly Deals Digest (02 Jun) – Infocom, CF Logistics, Asia Cement, GA Pack, Huafa, Shift Up

By Arun George

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments: Shift Up (462870 KS) seeks to raise up to US$320 million.
Event-Driven developments: Asia Cement China (743 HK), Greatview Aseptic Packaging (468 HK), Huafa Property Services Group (982 HK), Chilled & Frozen Logistics Holdings (9099 JP), Infocom Corp (4348 JP).

Last Week in Event SPACE: Mitsui Matsushima, China Merchants,Kansai Paint, Teijin, Sciclone Pharma

Colour me perplexed. Murakami Group ran up Mitsui Matsushima (1518 JP)‘s share price in acquiring 29%. The pattern was clear, but one assumes everyone in-group was on the same page.
Two activist shareholders. And long only upping its stake. Heavily discounted China Merchants China Direct Investments (133 HK) is in play.
A HUGE new buyback for Kansai Paint (4613 JP). Really big. Buy Kansai Paint vs Nippon Paint. One can buy the pop. One can buy any dips after the pop.

Helios Techno Holding (6927) – Small TOB, Fat Premium (74%), Still Too Cheap