In today’s briefing:
- HK Connect SOUTHBOUND Flows (To 15 Mar 2024); Strong Net Buying on Tencent and ETFs
- Updated Tool and New “Diff File Generator” for TSE “Mgmt Conscious of Capital Cost/Stock Price”
- (Mostly) Asia-Pac M&A:QV Equities, TASK, Qantm, Superloop, CIMC Vehicle, JSR, Roland DG, Outsourcing
- Investigating the Size and Timing of Korea’s Local Dividend Arbitrage Traders’ Position Liquidation
- Weekly Deals Digest (17 Mar) – JSR, Roland DG, CIMC Vehicles, Li Ning, Alumina, QV Equities, Japfa
- Mainland Connect NORTHBOUND Flows (To 15 Mar 2024): Biggest Net Buying in a While, CATL a Big Buy
- A/H Premium Tracker (To 15 Mar 2024): Liquid AH Premia Starting to Narrow
- Quiddity Leaderboard BSE/SENSEX Jun 24: Who Will Replace Wipro?
- Last Week in Event SPACE: Keisei Electric /Oriental Land, SingTel, Alumina/Alcoa, Li Ning
HK Connect SOUTHBOUND Flows (To 15 Mar 2024); Strong Net Buying on Tencent and ETFs
- A shares were up small on the week. The spivvier the better. HK was up better, especially among the liquid names.
- Net SOUTHBOUND buying was +HK$21.4bn in the fourth post-holiday week vs +HK$17bn the week before. SOUTHBOUND has net bought every day since the end of Chinese New Year.
- The flavour of SOUTHBOUND buying has been high-div SOEs for months and months. That is starting to change slightly. Tencent was a net buy the second week in a row.
Updated Tool and New “Diff File Generator” for TSE “Mgmt Conscious of Capital Cost/Stock Price”
- In mid-January, the TSE announced a “name-and-shame” list where they listed all the companies which had put forth a disclosure about 【資本コストや株価を意識した経営の実現に向けた対応】. But they did not actually shame.
- The list shows which companies have disclosed a policy/consideration. But no data/links. We have the links. On Feb 1, the TSE put out a presentation and set of case studies.
- We created a tool to name everyone, show their reports, provide links, and now a new tool. Put in a name, see the difference between the Old/New Reports.
(Mostly) Asia-Pac M&A:QV Equities, TASK, Qantm, Superloop, CIMC Vehicle, JSR, Roland DG, Outsourcing
- I tally 50 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
- Two new deals were discussed this week on Smartkarma: WAM Leaders (WLE AU) scrip-deal for QV Equities (QVE AU); and TASK Group (TSK AU)‘s Scheme with PAR Technology (PAR US).
- Key updates took place on: Qantm Intellectual Property (QIP AU), Superloop (SLC AU), CIMC Vehicle (1839 HK), JSR Corp (4185 JP), Roland DG Corp (6789 JP), and Outsourcing (2427 JP).
Investigating the Size and Timing of Korea’s Local Dividend Arbitrage Traders’ Position Liquidation
- Estimating FINANCIAL INVESTMENT’s dividend arbitrage positions’ exact size and liquidation plans is challenging. Yet, past trading patterns suggest a substantial portion may be liquidated soon, akin to January’s volume (≥₩2T).
- Many local market participants expect a scenario unfolding post-March, aligning with KOSPI companies rescheduling ex-dividend dates. Expect substantial position liquidation by April’s end, likely impacting index negatively, akin to January.
- Position setups should adapt to short-term index corrections, leveraging earnings season for earnings-based spreads using index short hedging.
Weekly Deals Digest (17 Mar) – JSR, Roland DG, CIMC Vehicles, Li Ning, Alumina, QV Equities, Japfa
- A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
- ECM developments: Trial Holdings (5882 JP) and Lianlian DigiTech (2104619D CH) IPOs.
- Event-Driven developments: JSR Corp (4185 JP), Roland DG Corp (6789 JP), Yaizu Suisankagaku Industry (2812 JP), Alumina Ltd (AWC AU), QV Equities Ltd (QVE AU), CIMC Vehicles.
Mainland Connect NORTHBOUND Flows (To 15 Mar 2024): Biggest Net Buying in a While, CATL a Big Buy
- The Quiddity Mainland Connect NORTHBOUND Monitor. Like the A/H Premium Monitor and HK Connect SOUTHBOUND Monitor. Lots of Flows/Position Tables and Charts with which to play.
- Last week saw NORTHBOUND net BUY RMB 32.8bn of A-shares on decent volume after one RMB-3bn week following 5 weeks straight of net buying total RMB +63bn. Foreigners are in.
- The volume now is back to chasing momentum, but given so much net buying, much of it appears to be passive plus a CATL kicker.
A/H Premium Tracker (To 15 Mar 2024): Liquid AH Premia Starting to Narrow
- The New/Better A-H Premium Tracker has tables, charts, measures galore to track A/H premium positioning, southbound and northbound positioning/volatility in pairs over time, etc.
- SOUTHBOUND a net buyer every day since the end of Chinese New Year. NORTHBOUND a huge net buyer this week, now net buyers in size (RMB +93bn) over 7 weeks.
- For the first time in a while, AH premia among liquid stocks fell convincingly. Narrow AH premia pairs saw Hs outperform more than wide AH premia Hs (vs As).
Quiddity Leaderboard BSE/SENSEX Jun 24: Who Will Replace Wipro?
- In this insight, we take a look at the Potential ADDs/DELs for the BSE SENSEX, 100, and 200 Indices in the June 2024 index rebal event.
- As things stand, there could be one index change for the SENSEX index but there is room for these names to change during the remainder of the reference period.
- Separately, there could be five ADDs/DELs for the BSE 100 index and six ADDs/DELs for the BSE 200 index.
Last Week in Event SPACE: Keisei Electric /Oriental Land, SingTel, Alumina/Alcoa, Li Ning
- Even if you were an activist, or a trader with an activism tilt, be long Keisei Electric Railway Co (9009 JP) vs. Oriental Land (4661 JP).
- Reportedly, Singtel (ST SP) is negotiating a sale of Optus. Both Singtel and Optus scotch those rumours.
- Alumina Ltd (AWC AU) and Alcoa (AA US) enter into a Scheme. As expected. The key question: is CITIC, with 18.9% of shares out, supportive?
💡 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
