In today’s briefing:
- HSI Index Rebalance Preview (March 2022): The Slow Crawl Continues
- TOPIX-Nikkei Skew Trade Starting to Work Nicely
- Facebook 4Q21: Trending on TikTok ‘How to Lose $200B in Market Cap’
- KOSPI 200 Rebalancing Screening: Prediction Likelihood, Special Issues, & Passive Impacts
- Turo IPO Preview: The Largest Car Sharing Marketplace in the World
- FnGuide TIGER Top 10 Rebalancing: LG Energy IN & Celltrion OUT
- Kura Sushi (2695): Relay from Demon Slayer to BTS. Winning with Entertainment Value
- Wabco India: Domestic Capex Cycle Beneficiary, CV Recovery Play
- Amber Enterprises India: Components Business Drives Topline
- Ohsho Food Service (9936): Solid January Sales Despite Omicron Impact
HSI Index Rebalance Preview (March 2022): The Slow Crawl Continues
- The March rebalance should see the slow crawl toward 80 index members continue. We should get up to 68-70 members in March. Reaching 80 by June is unlikely.
- High probability inclusions are Kuaishou Technology (1024 HK), Smoore International (6969 HK), Nongfu Spring (9633 HK), JD Health (6618 HK) and JD Logistics (2618 HK).
- Currently, index turnover due to capping/float changes is low which will allow more stocks to be added to the index. Increase in the turnover will result in fewer changes.
TOPIX-Nikkei Skew Trade Starting to Work Nicely
- After initially grinding up slowly but underperforming the Nikkei our suggested skew trade gave up ground during the new year sell off.
- It did so slowly, however and was outperforming Nikkei when last we checked despite being down slightly.
- Thankfully, a lot of the idiosyncratic volatility hurting the skew trade has reversed now and it is positive and outperforming Nikkei consistently.
Facebook 4Q21: Trending on TikTok ‘How to Lose $200B in Market Cap’
- 5 Issues: Tough Comps, Supply Chain Disruptions, Reels MixShift, Apple IDFA, and TikTok…thats alot of issues
- TikTok is pressuring engagement and Google is taking Facebook’s advertising revenues.
- Strong management team with history of executing at a trough valuation provides a good entry point. But may make more sense to just buy Google.
KOSPI 200 Rebalancing Screening: Prediction Likelihood, Special Issues, & Passive Impacts
- The screening results based on the average market cap for the screening period until the last closing price have seven additions/deletions.
- LG Energy will make Fast Entry. The one to make room for LG Energy should be Dongwon F&B, an additional deletion to the seven deletions through the preliminary filtering.
- F&F Holdings may fail to meet the minimum float rate. If it doesn’t make KOSPI 200 this time, Hyundai Marine & Fire Insurance will get to stay in the Index.
Turo IPO Preview: The Largest Car Sharing Marketplace in the World
- Established in 2010, Turo has become the largest car sharing marketplace in the world. It is attempting to complete its IPO in a turbulent IPO market.
- Turo’s sales and profit growth skyrocketed in 2021. Its sales jumped by 206.5 YoY to reach $330.5 million in 1Q-3Q 2021.
- Since the company’s inception, hosts have earned more than $1.1 billion in aggregate on its platform.
FnGuide TIGER Top 10 Rebalancing: LG Energy IN & Celltrion OUT
- The screening period for the upcoming rebalancing is May 3-31. LG Energy satisfies the 3-month minimum listing requirement, so it becomes eligible to join the Index in this rebalancing.
- LG Energy will likely receive an inflow of ₩44.6B, 0.04% of SO. Considering its tight real-world float (less than 6%), it would still be something we don’t want to overlook.
- What is critical is an estimated outflow size of Celltrion. It would be about the same amount, but relative to its ADTV, it will be -0.26x.
Kura Sushi (2695): Relay from Demon Slayer to BTS. Winning with Entertainment Value
- On February 3, Kura Sushi (2695, the company) disclosed monthly data for January (on a preliminary basis)
- The company ran a special fair using high-end ingredients in early January and has been running a “BT21” campaign from January to February.
- BT21 is a globally popular character brand created through a collaboration between LINE FRIENDS and BTS (Bangtan Sonyeondan)
Wabco India: Domestic Capex Cycle Beneficiary, CV Recovery Play
- Wabco India (WIL), now part of the ZF Group, is the market leader in the CV braking space and a technology-focused complete solutions provider
- FY21 channel mix – OEM 41%, aftermarket 16%, exports 43%
- Target Price and Valuation: Introducing FY24E numbers, we now value the company at Rs 9,530 i.e. 50x P/E on FY24E EPS (earlier target price Rs 8,800
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Amber Enterprises India: Components Business Drives Topline
- Amber is a leading solution provider for air conditioner OEM/ODM industry in India.
- The company has a product portfolio including RACs, RAC components and other non AC components
- Derives ~62% of its revenues from RACs and the rest from components and mobility applications
Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.
Ohsho Food Service (9936): Solid January Sales Despite Omicron Impact
- Ohsho Food Service (9936, the company) disclosed monthly data for its directly-owned stores for January (on a preliminary basis)
- Same-store sales were 106.9% vs. January 2021 (105.4% for December), 94.9% vs. January 2020, and 104.3% vs. January 2019
- The company’s sales remained solid despite the shortening of operating hours and restrictions on alcohol beverages
Before it’s here, it’s on Smartkarma
