In today’s briefing:
- HS Holdings (8699 JP) Buyback – Adds More to BVPS
- Quiddity Leaderboard ASX Sep 23: Many Changes Ahead
- Hong Kong CEO & Director Dealings (21 June): China Feihe’s CFO Sells Around All-Time Low
- Nikkei 225 Sep 2023 Review – The Mercari Conundrum
- KFin Tech Lock-Up – US$183m Lockup Expiry Could See PE Investor Trim Further
- KRX New Deal Index Rebalance Preview: Interesting Changes Emerging
- Hyundai Elevator Chairwoman Hyun Seeks Capital from H&Q Korea
- Alpha Auto Group/Lookers: Consolidation at a Cheap Offer Price
HS Holdings (8699 JP) Buyback – Adds More to BVPS
- HS Holdings (8699 JP) remains an interesting hodgepodge of assets. It owns just under 50% of Mongolia’s biggest bank, recently IPOed Khan Bank (KHAN MO).
- It has a pile of cash. And it has a glorified pawn shop business in Japan. The bank shares must be sold, to a significant degree, by end of year.
- Today it announced a buyback tomorrow of 6.4% of shares out. I expect it is one of two large individual holders. We’ll probably know more within a week.
Quiddity Leaderboard ASX Sep 23: Many Changes Ahead
- In this insight, we take a look at the potential index changes for ASX 300, 200, 100, 50, and 20 in the run up to the September 2023 Rebalance.
- I currently expect one change for the ASX 100 index and five changes (including one intra-review change) for the ASX 200 index.
- There could be 7 ADDs and 5 DELs for the ASX 300 index.
Hong Kong CEO & Director Dealings (21 June): China Feihe’s CFO Sells Around All-Time Low
- The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
- Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.
- The key stock mentioned in this regular insight is China Feihe (6186 HK)
Nikkei 225 Sep 2023 Review – The Mercari Conundrum
- Mercari Inc (4385 JP) is potentially a leading candidate for inclusion in the Nikkei 225 in September.
- There are other technical reasons to think it is not.
- This insight looks at the issue of why it might be a leading candidate and why it might not be.
KFin Tech Lock-Up – US$183m Lockup Expiry Could See PE Investor Trim Further
- KFin Technologies (1804170D IN) was listed on 29th Dec 2022, when it raised around US$180m in its India IPO. Its six-month lockup will expire on 24th Jun 2023.
- KFin Technology (KFin) is a technology driven financial services platform providing comprehensive services and solutions to the capital markets ecosystem.
- Coming up for six-month expiry is General Atlantic (the Promoter) and other pre-IPO shareholders. The Promoter had been the sole selling shareholder in the IPO.
KRX New Deal Index Rebalance Preview: Interesting Changes Emerging
- The review period for the September rebalance ends on 31 July, the changes will be announced towards end August and implemented at the close of trading on 7 September.
- There is one change currently for each of the Secondary Battery, Bio, Internet and Game indices. Plus there are a couple of changes for the BBIG indices.
- SK Biopharmaceuticals Co Ltd (326030 KS) has overtaken SK Bioscience (302440 KS) on average market cap and there will be large flows on both stocks at the rebalance.
Hyundai Elevator Chairwoman Hyun Seeks Capital from H&Q Korea
- It was reported in the local media that Hyundai Elevator Chairwoman Hyun Jeong-Eun is close to completing a deal with H&Q Korea in a deal worth nearly 300 billion won.
- The three major reasons driving higher share price of Hyundai Elevator in the last three months include share buyback/cancellation, potential M&A, and solid 1Q 2023 results.
- With noticeable downturn in the Korean construction sector, Hyundai Elevator could face worsening industry prospects for both residential and commercial elevators in the next 12-24 months in Korea.
Alpha Auto Group/Lookers: Consolidation at a Cheap Offer Price
- Long expected consolidation is arriving to UK car retailers. Alpha Auto agreed to acquire Lookers PLC (LOOK LN) via scheme at 120p/share, c.£465.4 million, 35.3% premium, 8.4x Fwd P/E.
- The sector appears materially undervalued, with Lookers before announcement on 6.2x Fwd P/E, 4% FY23e yield (4x cover). My fair value estimate is 143p/share (multiples and DCF), 19% above offer price.
- Spread 1.17%/4.32% (gross/annualised, assuming settlement around 1 October). Top shareholders have only signed letters of intent (40% aggregate). I’d be long in case of sweetening. VTU LN could be next.
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