In today’s briefing:
- Poly Culture (3636 HK): Trading Wide To Terms. Get Involved.
- KOSDAQ150 Ad Hoc Index Rebalance: VATECH (043150 KS) Replaces Lutronic (085370 KS)
- HSTECH Index Rebalance Preview: Round-Trip Trade of US$255m in December
- Origin Energy: ACCC’s Concerns And Brookfield’s Quid Pro Quo
- HSCEI Index Rebalance Preview: China Unicom (762) Could Replace Zhongsheng (881)
- EQD | S&P/ASX200 Index Looking Bearish: Resistance Levels Reset
Poly Culture (3636 HK): Trading Wide To Terms. Get Involved.
- Back on the 27 June, art and culture play Poly Culture Group Corp H (3636 HK) announced a pre-conditional privatisation at HK$8.88 per H-share.
- This Offer from SOE Poly Group is by way of a Merger by Absorption, incorporating a Scheme-like vote. There is no tendering condition.
- The pre-cons have now been fulfilled. The Composite Document, including the H Share Class meeting/EGM date and IFA opinion, is expected to be despatched on or before the 30 September.
KOSDAQ150 Ad Hoc Index Rebalance: VATECH (043150 KS) Replaces Lutronic (085370 KS)
- Value Added Technologies (043150 KS) will replace Lutronic Corp (085370 KS) in the KOSDAQ 150 Index (KOSDQ150 INDEX) at the close on 14 September.
- Passive trackers will need to buy over 1.5x ADV on Value Added Technologies (043150 KS). The impact is higher on Lutronic Corp (085370 KS) but the arbs will provide liquidity.
- Value Added Technologies (043150 KS) appears to trade cheaper than its peers on all valuation parameters and there could be a re-rating following the index inclusion.
HSTECH Index Rebalance Preview: Round-Trip Trade of US$255m in December
- With no stocks in inclusion or deletion zone, we do not expect any constituent changes for the Hang Seng TECH Index (HSTECH INDEX) in December.
- Capping changes will result in a one-way turnover of a touch below 1% and that will result in a round-trip trade of US$255m.
- The impact on the stocks is relatively small for now but that could increase till the end of November when the stocks will be capped.
Origin Energy: ACCC’s Concerns And Brookfield’s Quid Pro Quo
- After Origin Energy (ORG AU) entered into a Scheme Implementation Deed with Brookfield Asset Management/MidOcean Energy in late March, the ACCC approval process has played out in the public eye.
- And it hasn’t been all beer and Skittles for the Offerors. Not just on competition issues. But also the perceived/apparent public benefit from Brookfield’s future commitment to renewable generation.
- All the while, the ACCC recently blocked ANZ (ANZ AU)’s acquisition of Suncorp Bank, and Telstra Corp (TLS AU)/TPG Telecom (TPG AU)‘s mobile network sharing deal.
HSCEI Index Rebalance Preview: China Unicom (762) Could Replace Zhongsheng (881)
- Zhongsheng Group (881 HK) is a potential deletion in December and that could result in China Unicom Hong Kong (762 HK) being added to the index.
- Estimated one-way turnover at the rebalance is 1.36% resulting in a one-way trade of HK$845m. Passives will need to trade over 1x ADV on both stocks.
- There is a very small impact on the fair value of the HSCEI 2023 dividend futures but there will be a larger impact on the dividend futures expiring in 2024.
EQD | S&P/ASX200 Index Looking Bearish: Resistance Levels Reset
- The S&P/ASX 200 (AS51 INDEX) closed down last week (CC=-1), this week is rising again, we analyze the new, reset resistance levels to see how far it can go.
- Our previous, recent insight discussed the fact that the index has been locked in a range for 2 years, an uptrend may be unfolding but it must breach 7600.
- The current trend pattern is bearish, the index won’t rise more than 2-3 weeks, and it would probably go not very far: 7300-7400 should be the limit
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