In today’s briefing:
- Sun Corp (6736) – The Future Is Bright
- Value-Up Flow Trading Opportunities Arising from NPS’s 10% Ownership Ceiling on Banks
- Merger Between Celltrion Inc and Celltrion Pharm Is Cancelled
- EQD | The ASX200 Can Rally Higher (If This Is A Rally…)
- Ola Electric (OLAELEC): EV Maker Receives Turbo Boost from Lock-Up Expiries for Index Inclusion
Sun Corp (6736) – The Future Is Bright
- The reason why Sun Corp (6736 JP) has traditionally traded at a large discount to its potential outcome is the possibility of inefficient or delayed value realisation.
- Materially ALL of the value of the company is in its holding in Cellebrite DI (CLBT US). True Wind Capital, the SPAC sponsor of CLBT, just bought 19% of SunCorp.
- They bought that for the CLBT, or the value realisation thereof. And now with the slightly surprising Tender Offer result, the chances of a better outcome are now higher.
Value-Up Flow Trading Opportunities Arising from NPS’s 10% Ownership Ceiling on Banks
- NPS is concerned that aggressive value-up measures by bank holding companies and ongoing cancellations might quickly use up their room up to the 10% ownership limit.
- With their stake already at mid-8%, they may not buy as much as the index suggests, creating new trading opportunities in the four major bank holding companies.
- Woori Financial has more room for buying, so as the year ends, NPS’s skewed-buying could give it a better price impact than other bank holding companies.
Merger Between Celltrion Inc and Celltrion Pharm Is Cancelled
- Celltrion Inc announced that its proposed merger with Celltrion Pharm has been cancelled due to disapproval of this deal among an overwhelming percentage of Celltrion Inc shareholders.
- This cancellation of a merger between Celltrion Inc and Celltrion Pharm is likely to continue to have a positive impact on Celltrion Inc and negative impact on Celltrion Pharm.
- The major reason is because Celltrion Pharm trades at high valuation multiples while Celltrion Inc trades at lower valuation multiples. Celltrion Pharm’s P/B valuation is more than 3x Celltrion Inc’s.
EQD | The ASX200 Can Rally Higher (If This Is A Rally…)
- The S&P/ASX 200 has been quietly rallying since its (modest) -11% correction in 2023, mostly unaffected by global turmoils, even the latest sell-off in US, Asia and Europe was “non-damaging”.
- The index has already recovered a large part of the losses suffered for only 1 week, very brief if we consider that the SPX INDEX had corrected for 4 weeks.
- Now that the S&P/ASX 200 has rallied strongly we want to analyze its pattern model, to identify the area where it could pull back again (or slow down).
Ola Electric (OLAELEC): EV Maker Receives Turbo Boost from Lock-Up Expiries for Index Inclusion
- Ola Electric (OLAELEC IN) is likely to get added at the March 2025 review following the lock-up expiry in November 2024 which increases the fcap way above the fcap threshold.
- Current fcap for February 2025 review is ~$1.2bn following the lock-up expiry in November 2024. Inclusion is based on whether fcap passes the prevailing fcap threshold.
- The lock-up expiry in February 2025, increases the probability of addition in May 2025 review if it fails inclusion in February.
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