In today’s briefing:
- Aggressive Shorting on Dongwon Industries, Which Has Not Been Noticed as a K200 Deletion
- Korea Small Cap Gem #21: TS Corp – Addicted to Sugar
- To Change a Company that Didn’t Change when Activist Investors Asked for Solutions to Their Issues
- Coca-Cola Q1 Earnings Preview: Factors To Consider
- Etsy Inc.: Major Drivers
- IPAR: Demand Outpacing Expectations
Aggressive Shorting on Dongwon Industries, Which Has Not Been Noticed as a K200 Deletion
- Dongwon Industries’ float rate is less than 10% (1 – 63.15% – 27.65% = 9.20%), which makes it ineligible for KOSPI 200. KRX will reflect this in the June review.
- The passive outflow size due to K200 deletion is expected to be about 50 billion won, which will cause an impact of about 28x ADTV.
- Considering this deletion has not been sufficiently exposed in the market, the actual price impact may be even more significant and preemptive.
Korea Small Cap Gem #21: TS Corp – Addicted to Sugar
- Ts Corporation (001790 KS) is the 21st company in our Korea Small Cap Gems series.
- TS Corp is one of the largest sugar refining companies in Korea. Rising raw sugar prices generally have a positive impact on TS Corp’s sales and profits.
- TS Corp owns very valuable real estate assets that are much larger than its current market cap (299 billion won).
To Change a Company that Didn’t Change when Activist Investors Asked for Solutions to Their Issues
- Now that percentage of foreign shareholders has reached 30%, other foreign shareholders are more likely to support activist investors’ proposals, and companies are paying more attention to communication with investors.
- While cross-shareholdings held by banks etc. are declining, foreign shareholders and trust banks are on the rise. The holdings held by trust banks are managed by domestic institutional investors.
- Whether their exercise of voting rights changes from the past will be the key to improving governance and moving forward with solutions to issues that have been postponed until now.
Coca-Cola Q1 Earnings Preview: Factors To Consider
- Inflationary headwinds in Latin America might have had a material effect in Q1.
- However, Coca-Cola’s EMEA and North American results will probably blossom once more.
- Most are non-core and unlikely to influence the stock’s valuation, KO stock is fairly valued.
Etsy Inc.: Major Drivers
- Etsy Inc delivered a mixed set of results during the quarter and managed to surpass the revenue expectations of analysts but its profitability was below par.
- The company’s management claims that its overall reach and consumer demand have increased and the services offered by the company are differentiated.
- The company’s marketing programs, including the Star Seller program, continued to benefit the company.
IPAR: Demand Outpacing Expectations
- IPAR announced its first quarter sales highlighting the continued momentum in demand the Company has been seeing in recent quarters.
- IPAR’s major brands each grew by more than 20 percent compared to the year ago period.
- IPAR raised full year sales and EPS outlook as the business continues to run with brisk demand
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