In today’s briefing:
- Ecopro Materials IPO – Peer Comparison – Doesn’t Particularly Stand Out
- Alpha Generation Through High Dividend Stocks in Korea
- Gap Trades in Korean Prefs Vs Common Share Pairs in 4Q 2023
- Setting up to Target Exclusion Stock Post Doosan Robotics’ KOSPI 200 Fast Entry
- Hanmi Pharm (128940 KS): Core Products Continue to Drive Sales; Pipeline Progress Raises Hope
Ecopro Materials IPO – Peer Comparison – Doesn’t Particularly Stand Out
- EcoPro Materials (ECO123 KS) is looking to raise up to US$500m in its Korean IPO.
- Ecopro Materials (EPM) manufactures and sells high-nickel precursors, one of the key materials for high-nickel cathode materials for secondary (rechargeable) batteries.
- In our previous note, we covered the company’s performance. In this note, we will undertake a peer comparison.
Alpha Generation Through High Dividend Stocks in Korea
- In the first table, we provide a list of 56 stocks (2.2% of total) which have dividend yields of 7% or more.
- The second table is a list of stocks with dividend yields of 7% or more and they are ranked in terms of market cap.
- These 25 stocks have an average dividend yield of 9.1%. The second table has 12 financials related stocks, representing 48% of total.
Gap Trades in Korean Prefs Vs Common Share Pairs in 4Q 2023
- In this insight, we discuss numerous gap trades involving Korean preferred and common shares in 4Q 2023. Typically, fourth quarter is when pref stocks are emphasized the most in Korea.
- The excessive gaps in the preferred and common shares of Samsung Electronics (005930 KS), Hotel Shilla (008770 KS), and Amorepacific Corp (090430 KS) could reverse in the next several months.
- We see some attractive longer-term opportunities for Amorepacific, Doosan Fuel Cell, LG Electronics, and Hyundai Motor which have especially high discounts for the preferred shares versus their counterpart common shares.
Setting up to Target Exclusion Stock Post Doosan Robotics’ KOSPI 200 Fast Entry
- Doosan Robotics has the potential to rise up to ₩104,000 on the listing date. The market cap would reach ₩6.74T, which fulfills the criteria for KOSPI 200 fast entry
- Based on this calculation, Zinus had the lowest average daily market cap during the previous rebalancing screening period. Therefore, Zinus will be excluded due to the inclusion of Doosan Robotics.
- KOSPI 200 passive trackers will need to conduct rebalancing trading reflecting this ad-hoc change on the closing price of November 9th.
Hanmi Pharm (128940 KS): Core Products Continue to Drive Sales; Pipeline Progress Raises Hope
- With 1H23 revenue of KRW704 billion, Hanmi Pharm (128940 KS) is on track on surpass its 2022 revenue of KRW1.33 trillion to reach a new high in 2023.
- Hanmi is developing epeglenatide as personalized obesity drug for South Korean market. With the spectacular success of obesity drugs in the U.S., epeglenatide seems to be have great market potential.
- Outlicensing partner Merck is conducting phase 2b trial on efinopegdutide for NASH, with result expected in 2025. Efinopegdutide obtained fast track designation from FDA, which should accelerate its commercialization.
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