In today’s briefing:
- SSE50 Index Rebalance Preview: Financials Continue to Outperform
- Aadhar Housing Finance IPO – Larger and Slower, at a Reasonable Discount
- Revisiting Jafco (8595.T) – Company Reaches An Important Milestone
- Zeekr IPO – Missed Targets and Related Party Deals – We Would Stick to the Bottom-End
- Quiddity Leaderboard SSE50/180 Jun 24: US$2bn One-Way; LONGs up +9.8% Vs SHORTs in ~2 Months
- Rebooting WeWork
- Crypto Crisp: Is That All, Hong Kong?
- S&P Global Inc.: Will The Visible Alpha & IHS Markit Acquisitions Pay Off In The Long Run? – Major Drivers
- Morning Views Asia: China Vanke
- American Airlines: How Are They Strengthening Their Footprint In Latin American & Beyond! – Major Drivers
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SSE50 Index Rebalance Preview: Financials Continue to Outperform
- With the review period nearing completion, 6 stocks are in inclusion zone and 9 are in deletion zone. However, there can be a maximum of 5 changes at a review.
- We estimate a one-way turnover of 7.1% at the June rebalance leading to a one-way trade of CNY 9.9bn (US$1.37bn). Index arb balances should increase the impact on the stocks.
- The potential inclusions (of which four are Financials) have continued to outperform the mixed bag of potential deletions. With pretty big impact on the deletes, expect further divergence.
Aadhar Housing Finance IPO – Larger and Slower, at a Reasonable Discount
- Aadhar Housing Finance (AHF) is now looking to raise around US$360m in its India IPO, via selling a mix of primary and secondary shares.
- AHF is focused on the low income housing segments (ticket size less than INR1.5m) in India. It offers a range of mortgage-related loan products.
- We have looked at the company’s performance in our past note. In this note, we talk about valuations.
Revisiting Jafco (8595.T) – Company Reaches An Important Milestone
- The company’s management fees now cover the operating costs after many years of losses
- Recent fund raising has surpassed expectations for its latest VC fund
- The company’s steps towards better capital allocation are trending in the right direction
Zeekr IPO – Missed Targets and Related Party Deals – We Would Stick to the Bottom-End
- ZEEKR (ZK US), a premium EV brand by Geely Auto (175 HK), aims to raise around US$370m in its US listing.
- Zeekr was formed in Mar 2021 as a JV between Geely and its founder. Its first model was launched in Apr 21 with deliveries starting in Oct 21.
- We have looked at the company’s past performance in our earlier notes. In this note, we talk about the updates from its recent filings and have a relook at valuations.
Quiddity Leaderboard SSE50/180 Jun 24: US$2bn One-Way; LONGs up +9.8% Vs SHORTs in ~2 Months
- SSE 50 and SSE 180, respectively, aim to represent the performance of the 50 and 180 largest and most liquid A-share stocks listed on the Shanghai Stock Exchange.
- The 12-month reference period used for the June 2024 review is now complete. The SSE 180 expected ADDs/DELs list has changed slightly since I published my last insight (link).
- In this insight, we take a look at our final expectations for index changes during the June 2024 index rebal event.
Rebooting WeWork
- The last week of SPACs was packed with buyouts, IPOs, and deal amendments.
- A co-working spaces provider gets a lifeline with a restructuring deal with its creditors, while a SPAC terminates a deal with a group of companies.
- Also, two new IPOs are announced, including one from serial sponsor Michael Klein after a three-year hiatus. Read on to find out the latest about all things SPACs.
Crypto Crisp: Is That All, Hong Kong?
- Unfortunately, it is not only Monday, but we have also found ourselves on the wrong side of the crypto market over the weekend.
- In Thursday’s Crypto Moves #26, we expressed a bearish outlook on the market for the short term.
- Contrary to our expectations, the overall industry did not adhere to our forecast.
S&P Global Inc.: Will The Visible Alpha & IHS Markit Acquisitions Pay Off In The Long Run? – Major Drivers
- S&P Global’s Q1 2024 earnings highlighted several key performance aspects that potential investors should consider while evaluating the company.
- The financial market intelligence provider posted a 14% increase in revenue, excluding the divestiture of Engineering Solutions, with transaction revenue in its Ratings division being a significant part of this rise.
- Subscription revenue across all business areas also achieved a year-on-year uptick of 8%, contributing to the quarterly revenue of roughly $3.5 billion, the highest in the company’s history.
Morning Views Asia: China Vanke
Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.
American Airlines: How Are They Strengthening Their Footprint In Latin American & Beyond! – Major Drivers
- American Airlines Group reported an adjusted net loss of $226 million for the first quarter of 2024, with revenues reaching $12.6 billion, a record high for a first quarter.
- Despite a surge in fuel expenses during the quarter which was around $100 million higher than initially anticipated, the company remains on track with its full year EPS guidance.
- American Airlines benefits from robust business travel, especially from small and medium-sized enterprises.