In today’s briefing:
- China Traditional Chinese Medicine (570 HK): Disaster as Offer Lapses, Potential Deal Break Price
- Thematic Report : Investment Opportunities in Indian Markets Led by Promoter Buying
- Need a Game Plan to Tackle Korea Zinc’s Buyback Tender with a 20% Proration Risk
- ABC/TI Fluid Systems: 10% Gross Spread on a Highly Likely Deal
- Align Partners Goes Activist on Doosan Bobcat
- EQD | Upcoming ASX200 Pullback in 1-2 Weeks
China Traditional Chinese Medicine (570 HK): Disaster as Offer Lapses, Potential Deal Break Price
- Shockingly, the Sinopharm-led consortium’s offer for China Traditional Chinese Medicine (570 HK) has lapsed as the precondition long stop date has not been extended.
- This deal break caught many, including me, off guard. There are lessons to be learnt and questions to be asked.
- Shareholders will have a bruising Monday. Our analysis suggests a deal break price of around HK$3.44, a 10% downside to the last close.
Thematic Report : Investment Opportunities in Indian Markets Led by Promoter Buying
- In the overheated Indian markets where selling spree by promoters is going at record pace.
- We identified certain interesting companies where promoters are buying giving confidence in their business
- We further delve into the thesis and key triggers for these companies
Need a Game Plan to Tackle Korea Zinc’s Buyback Tender with a 20% Proration Risk
- NPS is now viewing their voting rights on Korea Zinc purely from a returns angle, shifting from earlier expectations of siding with Choi due to political pressure.
- We need a tendering strategy for a 20% proration risk, focusing on when MBK will buy that extra 3.7% stake to cut losses on untendered shares.
- MBK will aim to buy leftover shares cheaply. Their approach depends on the progress of Choi and Trafigura’s talks
ABC/TI Fluid Systems: 10% Gross Spread on a Highly Likely Deal
- TI Fluid Systems (TIFS LN) is trading at 10% gross spread to ABC (Apollo)’s Proposal, which the Board of TIFS would be minded to recommend if made firm.
- Although TIFS has made notable strategic progress recently, and maintained margins despite tough conditions over the last years, the short-term car picture has gotten progressively worse.
- 200p implies 4.6x EV/NTM EBITDA versus global auto suppliers trading on a median of 4.4x and represents a good-value exit. I believe the deal will complete. Long.
Align Partners Goes Activist on Doosan Bobcat
- On 18 October, a local activist fund Align Partners Asset Management started its “corporate activism” on Doosan Bobcat Inc (241560 KS).
- Align Partners sent a shareholder proposal letter requesting a significant increase in the shareholder return rate, including dividends and selling off non-core assets.
- We believe that Align Partners’ corporate activism on Doosan Bobcat is likely to have a positive impact on Doosan Bobcat’s share price.
EQD | Upcoming ASX200 Pullback in 1-2 Weeks
- This week the S&P/ASX 200 INDEX entered WEEKLY OVERBOUGHT status intra-week, peaking at 8384.50, then pulling back to 8283.20 at Close.
- In this insight we will examine resistance levels the index will have a hard time to clear, without pulling back first at least 1 week.
- According to our quantitative models, a pullback is highly likely to happen this week, or the next.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
