In today’s briefing:
- HSCI Index Rebalance: 24 Adds, 14 Deletes & Changes to Stock Connect
- Hang Seng TECH Index Rebalance: No Changes BUT Big Turnover
- Last Week in Event SPACE: Tencent/Meituan, Jardine Matheson, Giordano, Nearmap, Fraser Hospitality
- Fraser Hospitality Trust’s Scheme Meeting on 12 September
- (Mostly) Asia-Pac Weekly Risk Arb Wrap: Fraser Hospitality, Nearmap, Net Marketing, Tassal, Genex
- Index Rebalance & ETF Flow Recap: S&P/ASX, CSI300, SSE50, HSI, HSCEI, HSTECH, HSCI, CTG IPO, KQ150
- TOPIX Inclusions Pre-Event: Artspark Holdings (3663 JP)
HSCI Index Rebalance: 24 Adds, 14 Deletes & Changes to Stock Connect
- There are 24 adds and 14 deletes for the Hang Seng Composite Index (HSCI) at the September rebalance to take the number of index constituents up to 518.
- 19 of the 24 HSCI inclusions will be added to Southbound Stock Connect, while 12 of the 14 HSCI deletions will be removed from Southbound Stock Connect.
- Five of the HSCI constituents could be removed from Southbound Stock Connect only since the average market cap over the last year is less than HK$5bn.
Hang Seng TECH Index Rebalance: No Changes BUT Big Turnover
- There are no changes to the index names, but FAF and capping changes will lead to a one-way turnover of 4.5% and one-way flow of HK$3,287m.
- An increase in the FAF from 3% to 40% will result in passive inflows of HK$1.18bn for SenseTime Group (20 HK) – that is over 5 days of ADV.
- There are large shorts on some of the stocks that will have passive outflows and some of these positions could be covered on implementation day.
Last Week in Event SPACE: Tencent/Meituan, Jardine Matheson, Giordano, Nearmap, Fraser Hospitality
- Chinese food delivery giant Meituan (3690 HK) shed 9% after Tencent (700 HK) reportedly planned to divest its $24bn stake. But it may just be a misunderstanding. Maybe.
- Given Jardine Matheson Holdings (JM SP)‘s strong underlying operating performance, the 40% discount to NAV – one in which there are discounts of discounts – JMH appears attractive here.
- Expect a firm Offer for Nearmap Ltd (NEA AU) shortly. Thoma Bravo’s due diligence is already at an advanced stage. And why Nearmap entered into the break fee.
Fraser Hospitality Trust’s Scheme Meeting on 12 September
- Frasers Hospitality Trust (FHT SP)’s EGM and trust scheme meeting will take place on 12 September. The effective date is 12 October with a payment date of 19 October.
- The offer comprises S$0.70 cash per share + permitted distributions (estimated 1.356 cents). The IFA considers the scheme consideration to be fair and reasonable.
- This is a done deal. For a 19 October payment, the gross and annualised spread of the offer (inc. permitted DPU) S$0.714 per unit is 1.9% and 12.1%, respectively.
(Mostly) Asia-Pac Weekly Risk Arb Wrap: Fraser Hospitality, Nearmap, Net Marketing, Tassal, Genex
- There are 46 – 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: Thoma Bravo’s tilt for Nearmap Ltd (NEA AU); Net Marketing (6175 JP)‘s MBO.
- Key updates took place for Frasers Hospitality Trust (FHT SP), Tassal (TGR AU), Genex Power Ltd (GNX AU), MACA Ltd (MLD AU), and Giordano International (709 HK).
Index Rebalance & ETF Flow Recap: S&P/ASX, CSI300, SSE50, HSI, HSCEI, HSTECH, HSCI, CTG IPO, KQ150
- A busy Friday with the end of the S&P/ASX review period and announcement of changes to the Hang Seng family of indices and FTSE AW/AC at the September rebalance.
- Monday is the review cutoff for the FTSE TWSE Taiwan 50, STI, FTSE China 50 and A50 indices, among others. STAR50 Sep changes announcement expected post market close on Friday.
- There were some big inflows into Asia focused ETFs during the week, while the outflows from KraneShares CSI China Internet ETF (KWEB US) continued for yet another week.
TOPIX Inclusions Pre-Event: Artspark Holdings (3663 JP)
- After market close on Friday, Japan-based UI/UX software solutions company Artspark Holdings (3663 JP) announced (link) they will be working towards a Segment transfer from Standard market to Prime market.
- If a TSE-listed name moves from the Standard Market to the Prime Market, a TOPIX Inclusion event will be triggered.
- In this insight, we take a look at the ability of Artspark Holdings (3663 JP) to meet the Prime Market Segment Transfer Requirements and the TOPIX Inclusion Implications.
💡 Before it’s here, it’s on Smartkarma
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