In today’s briefing:
- Shinko Electric (6967) Update – MitCorp In The Mix?
- ANTA Sports Investor Day Targets DESCENTE (8114) For Growth
- Shinko Electric (6967 JP): Bidders Circle for Fujitsu’s Stake
- Kenedix J-REIT Family Merger – Still Room (But Less Time) To Move (Redux-Ish)
- A Shift in TIGER Top 10 ETF December Rebalancing: KB Financial Newly In But Not Ecopro Co
- IndusInd Bank (IIB IN): Passive Buying Coming Up as Foreign Room Crosses Key Threshold
- Macau Casinos: MGM China Looks Solid
- India – Free Float Changes to Drive Passive Inflows
- Youngpoong Paper Mfg: Concerns About CFD Related Selling – Another Margin Call?
- Lithium Power (LPI AU): Codelco’s Binding Offer at A$0.57
Shinko Electric (6967) Update – MitCorp In The Mix?
- Yesterday about 5 minutes before the close, Shinko Electric Industries (6967 JP) went into kehai, rising 8.6%, then falling back to end + 3% on the day.
- This morning, the stock opened down 2%, rose 4%, fell 4%, then rose 4%. All in the first 45 minutes. Then it fell back 4% and ended down 2% today.
- The proximate cause of all of this was a Reuters article out 5mins before the close yesterday suggesting Mitsubishi Corp (8058 JP) is considering bidding for Shinko Electric.
ANTA Sports Investor Day Targets DESCENTE (8114) For Growth
- Yesterday, Anta Sports Products (2020 HK) held its Investor Day in Beijing. They talked about Descente Ltd (8114 JP) and their plans.
- The presentation made by the Descente China Chairman talked about the evolution of performance and the target for 2026, suggesting higher profit now and growth going forward than market expectations.
- None of this changes my outlook for why Itochu Corp (8001 JP) is buying Descente shares in the market. And the stock is going up.
Shinko Electric (6967 JP): Bidders Circle for Fujitsu’s Stake
- Reuters reported that Mitsubishi Corp (8058 JP) is considering a joint bid for Fujitsu Ltd (6702 JP)’s 50% stake in Shinko Electric Industries (6967 JP).
- Fujitsu first flagged a potential stake sale in its 1HFY22 results last October. Previously rumoured suitors include Apollo Global Management, Bain Capital, Dai Nippon Printing, JIC and KKR.
- Shinko’s shares are up 73% YTD, which is not excessive compared to Ibiden Co Ltd (4062 JP) (up 63.2% YTD). The valuation is undemanding, which facilitates a potential offer.
Kenedix J-REIT Family Merger – Still Room (But Less Time) To Move (Redux-Ish)
- A month ago I wrote there was still time, and room, to move on the Kenedix Merger.
- Now there’s less time, but the situation and relationships are better understood.
- Tracking Excess Volume during the period since the announcement is interesting. And it may tell you less than you think.
A Shift in TIGER Top 10 ETF December Rebalancing: KB Financial Newly In But Not Ecopro Co
- While Ecopro Co’s stock has undergone significant corrections since August, KB Financial has sustained an upward trajectory, leading to a significant reversal in float-adjusted market cap.
- The current disparity between the two exceeds ₩2T, making it challenging to anticipate another reversal until the screening period.
- Ecopro Co and LG Energy Solution also warrant attention due to the narrow gap in their float-adjusted market capitalization. We should monitor any changes in their market capitalization moving forward.
IndusInd Bank (IIB IN): Passive Buying Coming Up as Foreign Room Crosses Key Threshold
- Foreign investors sold ~5.7m shares of Indusind Bank (IIB IN) from July to September. That selling has pushed foreign room above the key 15% threshold.
- With foreign room crossing 15%, passive trackers will need to buy a chunk of Indusind Bank (IIB IN) stock at the end of November.
- There will be positioning on Indusind Bank (IIB IN) though it appears some of that was taken off in the last couple of days.
Macau Casinos: MGM China Looks Solid
- Macau’s mass GGR in 3Q23, including slots, was down just 6.7% on 3Q19 levels, but up 11.1% quarter-on-quarter.
- The shifting regulatory sands across the gaming landscape has resulted in VIP baccarat revenue accounting for 24% of GGR in 3Q23, down from 43.8% in 3Q19, and 64.6% in 3Q13.
- All concessionaires have been impacted by the collapse of the junket industry. But those who relied less on VIP flow have fared better on a comparative basis.
India – Free Float Changes to Drive Passive Inflows
- Over the last few weeks, companies in India have been disclosing their shareholding pattern as of end-September. There are a few companies with significant float changes from end-March and/or end-June.
- The changes in free float could be reflected in domestic and global indices over the next couple of months resulting in action from passive trackers.
- We find 9 stocks where there could be inflows with passive trackers needing to buy over 1 day of ADV on most stocks.
Youngpoong Paper Mfg: Concerns About CFD Related Selling – Another Margin Call?
- Youngpoong Paper Mfg’s shares declined sharply by 30% to 33,900 won today, trading only 190k shares (3% of ADTV).
- There is high probability that this sell-off could be related to CFD related margin call.
- Daiyang Metal, the largest shareholder of Youngpoong Paper Mfg, also dropped limit down today. The Korea Exchange has temporarily suspended trading of both Youngpoong Paper and Daiyang Metal.
Lithium Power (LPI AU): Codelco’s Binding Offer at A$0.57
- Lithium Power International (LPI AU) has entered a scheme implementation deed with Corporacion Nacional del Cobre de Chile (Codelco) at A$0.57 per share, a 119.2% premium to the undisturbed price.
- Shareholders representing 32.47% of outstanding shares will vote in favour of the scheme. Forums suggest that retail shareholders are broadly resigned to accepting the offer.
- The offer is conditional on FIRB approval. The scheme meeting will be held on 23 January 2024. At the last close, the gross spread was 7.5%.
💡 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
