In today’s briefing:
- E-Guardian (6050) Partial Offer Update
- Market Information About Samsung Electronics’ Shareholder Return
- Yuanta ETFs Rebalance Preview: Changes Galore as Stocks Soar; Shorts Increase, Then Cover
- Ping An A/H Premium: Sell the A’s, Buy the H’s; National Team at Work?
- SK Rent A Car: SK Networks’ Tender Offer
- SK Networks Launches a Tender Offer for SK Rent-A-Car
- Quiddity Leaderboard T50/100 Sep 23: Final Expectations; AI Frenzy Fades; Wisdom Marine TDIV DEL
- Offshore China ETFs Rebalance Preview: Two Changes Expected in September
- Quiddity Leaderboard TDIV Sep 23: Wisdom Marine Could Underperform the Index
- Hanwha Ocean’s Massive Issuance: Clearly, This Is Test-The-Water and How to Approach It
E-Guardian (6050) Partial Offer Update
- When this was launched, it traded more volume than expected on the first day, then again on the second day. Since then it has traded cheap vs initial estimates.
- A week after the launch, two separate Large Shareholder Filings came out. Those bear scrutiny.
- The back end trade is still an interesting one in my opinion.
Market Information About Samsung Electronics’ Shareholder Return
- The local market is increasingly convinced that Samsung Electronics’ quarterly dividends for the latter half of this year will experience a reduction.
- Samsung Electronics plans to apply the updated regulations from the 2024 1st quarter dividends, following the conclusion of the capital market law revision at the end of this year.
- It might be prudent to refrain from trading that bets on a reduction in the 1P discount in the first half of this year.
Yuanta ETFs Rebalance Preview: Changes Galore as Stocks Soar; Shorts Increase, Then Cover
- There should be 4 changes to the Yuanta/P-Shares Taiwan Top 50 ETF and 1 deletion for the Yuanta/P-Shares Taiwan Dividend Plus ETF in September.
- The potential adds are driven by the AI-frenzy that has swept the market for the last few months. Most potential deletions are shipping stocks that are way off their highs.
- Short interest on the potential deletions is high in terms of days of ADV and free float. The rise in shorts on the potential adds is being rapidly covered.
Ping An A/H Premium: Sell the A’s, Buy the H’s; National Team at Work?
- The premium of Ping An Insurance Group of (601318 CH) to Ping An Insurance (H) (2318 HK) has jumped from 4% to 14% in the space of a week.
- There has also been a jump in the Hang Seng Stock Connect China AH Premium Index and big inflows to mainland China ETF raising the possibility of National Team buying.
- A stabilisation in onshore China markets could lead to the AH premium dropping back towards parity and we would gradually scale out of long A/ short H positions.
SK Rent A Car: SK Networks’ Tender Offer
- Korean car rental play SK Rent A Car (068400 KS) has announced a Tender Offer from SK Networks (001740 KS), its largest shareholder with ~76%.
- SK Rent shareholders have the option of receiving cash or SK Networks scrip. Appraisal rights are also afforded.
- The shareholder vote is a lock. The current trade is the cash offer, which is trading tight to terms.
SK Networks Launches a Tender Offer for SK Rent-A-Car
- We have a positive view of SK Networks’ tender offer of SK Rent-A-Car.
- SK Networks is trying to buy the entire SK Rent-A-Car which is enjoying solid growth in sales and profits. SK Networks plans to eventually delist SK Rent-A-Car.
- The shareholders of SK Rent-A-Car have a choice of tendering their shares receiving cash (at the tender offer price of 13,500 won) or receiving shares in SK Networks.
Quiddity Leaderboard T50/100 Sep 23: Final Expectations; AI Frenzy Fades; Wisdom Marine TDIV DEL
- Today is the base date for the T50 and T100 Indices for the September 2023 Rebalance.
- In this insight, we take a look at the final expectations for ADDs/DELs for the T50 and T100 Indices.
- Previously, I expected five and three changes for the T50 and T100 indices, respectively, but now I see four changes for both indices.
Offshore China ETFs Rebalance Preview: Two Changes Expected in September
- Based on the close of 21 August, there could be two changes for the iShares A50 China (2823 HK)/ CSOP A50 (HKD) (2822 HK) in September.
- NARI Technology Co Ltd A (600406 CH) and CSC Financial (601066 CH) should replace Tongwei Co Ltd A (600438 CH) and Shaanxi Coal Industry (601225 CH) in the ETFs.
- There are couple of stocks with over 1x ADV to trade from the ETFs. Plus there are cash and carry positions that will need to be rebalanced, adding to flow.
Quiddity Leaderboard TDIV Sep 23: Wisdom Marine Could Underperform the Index
- In this insight, we take a look at Quiddity’s final flow expectations for the September 2023 index rebalance.
- In my previous insight, I revised my AUM assumption upwards but now I have revised it downwards based on the latest available data.
- Based on the latest available data, I see 47 names with positive index flow expectations and 3 names with negative index flow expectations (including the DEL Wisdom Marine).
Hanwha Ocean’s Massive Issuance: Clearly, This Is Test-The-Water and How to Approach It
- Multiple local news outlets reported Hanwha Ocean is undergoing a 2.5 trillion won equity increase. The official disclosure regarding this matter is expected to be released within this month.
- We have repeatedly observed a pattern of testing the waters through leaks to the local media. The case of Hanwha Ocean can also be seen in this light.
- It’s challenging to envision this magnitude being absorbed seamlessly by the market. There is a considerable likelihood that both issuers and bankers will aggressively attract inflows of arbitrage-seeking hot money.
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