In today’s briefing:
- Xiaomi (1810 HK)’s US$5bn Placement: Unfavourable Index Dynamics but Strong Momentum
- Tokyu Corp (9005) To Lift Stake in Tokyu REIT (8957) Again – Bigger Than You Think It Is
- Gold Road (GOR AU): Rejects an NBIO from Gold Fields (GFI US)
- Short Selling Resuming on 31 March in Korea – Stocks With Highest Short Selling Lending Balance
- StubWorld: Sun Corp (6736 JP) Is Still Inexpensive To Its Cellebrite Stake
- More Gold Fever: Gold Field’s Hostile Tilt For Gold Road
- Insiders’ Playbook: Who’s Buying and Selling Amid Market Turbulence?
- Telefónica: Execution and Valuation Update
Xiaomi (1810 HK)’s US$5bn Placement: Unfavourable Index Dynamics but Strong Momentum
- Xiaomi Corp (1810 HK) is looking to place 750m shares at a price range of HK$52.8-54.6/share, a 4.2-7.4% discount from last. That could raise up to HK$40.95bn (US$5.27bn).
- There will be limited passive buying near-term. There will be more passive buying at the end of May. Then there will be passive selling early June.
- Shorts will be hurting from the relentless move higher in the stock and there could be short covering if the stock moves lower from these levels.
Tokyu Corp (9005) To Lift Stake in Tokyu REIT (8957) Again – Bigger Than You Think It Is
- Today, Tokyu Corp (9005 JP) announced it would increase its stake its family REIT, buying up to 48,880 units or 5.0% of units out over the next six months.
- This comes a couple of days after Hankyu Hanshin announced the same for its REIT, discussed here. Others have done so before. Tokyu has. Others will do so going forward.
- The main reason? Squeeze the ‘share’ price higher. Get the REIT to 1.0x PNAV then stuff it with sponsor-held properties. That’s not bad. The goal is a higher price.
Gold Road (GOR AU): Rejects an NBIO from Gold Fields (GFI US)
- Gold Road Resources (GOR AU) has rejected a non-binding proposal from Gold Fields (GFI US). The offer is A$2.27 plus value per share of Gold Road’s shareholding in De Grey.
- The Board has rejected the offer mainly due to opportunistic timing and no value attributed to the potential underground expansion of the Gruyere mine (Gold Road/Gold Fields are JV partners).
- The proposal is a logical consolidation to eliminate dis-synergies. The offer is reasonable compared to peer multiples, precedent transactions and historical trading ranges.
Short Selling Resuming on 31 March in Korea – Stocks With Highest Short Selling Lending Balance
- Short selling balance in the Korean stock market was 62.4 trillion won as of 21 March 2025, up significantly from 47.2 trillion won three months ago.
- Among the stocks in KOSPI with high short selling balance and high lending balance ratios include Posco Future M, Yuhan Corp, LG Energy Solution, and Hanwha Aerospace.
- Among the stocks in KOSDAQ with high short selling balance and high lending balance ratios include Ecopro BM, Ecopro Co, HLB, and Eo Technics.
StubWorld: Sun Corp (6736 JP) Is Still Inexpensive To Its Cellebrite Stake
- Sun Corp (6736 JP) has declined ~6% in the past month. Its 44.3% stake in Cellebrite DI (CLBT US) is worth ~186% of its market cap.
- Preceding my comments on Sun Corp are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
More Gold Fever: Gold Field’s Hostile Tilt For Gold Road
- Gold Road Resources (GOR AU) has rejected an unsolicited offer from Gold Fields Ltd (GFI SJ),
- In a bid to secure control over the Gruyere JV mine in WA, Gold Roads offered A$2.27/share, “plus … Gold Road’s interest in .. De Grey Mining (DEG AU).“
- To spice things up Gold Road countered with a proposal to acquire Gold Fields’ interest in Gruyere, which was also rejected by Gold Fields.
Insiders’ Playbook: Who’s Buying and Selling Amid Market Turbulence?
- The start of 2025 has been particularly turbulent for Indian equities as broader market sentiment soured due to elevated valuations, foreign institutional investor (FII) outflows, and global macro uncertainty.
- However, amid this volatility, one signal stood out: insider trading activity.
- In this report, we deep-dive into insider buying and selling trends from January 1 to March 3, 2025, to uncover where company promoters and top executives are placing their bets
Telefónica: Execution and Valuation Update
- Telefónica is nearing completion of its Latin American divestment strategy, unlocking capital from low-margin markets and reducing geopolitical risk, with €2.5 billion equity value estimated for remaining Hispam units.
- A conservative 4x EV/EBITDA multiple applied to Hispam subsidiaries yields a fair value of €5.06 per share, while a prudent €4.50 target reflects geopolitical and execution risk buffers.
- Proceeds from disposals strengthen Telefónica’s balance sheet, support its 7% dividend yield, and enable reinvestment into high-growth segments like Tech and fibercos, enhancing long-term shareholder value and operating efficiency.
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