In today’s briefing:
- Offshore China ETFs Rebalance Preview: Two Changes Expected in March
- Ayala Corp Placement – While Overhang Will Exist, the Stock’s Momentum Has Been Strong
- Suruga Bank – Only 33% of Buyback Done, Profit Guidance to Rise a Lot, Credit Saison Support Growth
- [Week 16] Namaste India 🙏 | More Smoke for Bandhan?
- [KE Holdings(BEKE US, BUY, TP US$24.5) Update]: Singaporization of Real Estate Has LT Plus, ST Minus
- EQD | KOSPI 200 Readying for LONG Reversal
Offshore China ETFs Rebalance Preview: Two Changes Expected in March
- Based on the close of 8 January, there could be two changes for the iShares A50 China (2823 HK)/ CSOP A50 (HKD) (2822 HK) in March.
- Shaanxi Coal Industry (601225 CH) and China Everbright Bank Co A (601818 CH) could replace Bank Of Ningbo Co Ltd A (002142 CH) and Aier Eye Hospital Group (300015 CH).
- The impact of passive trading will be higher on the inclusions compared to the deletions. Then there are cash and carry positions that will be rebalanced, adding to flow.
Ayala Corp Placement – While Overhang Will Exist, the Stock’s Momentum Has Been Strong
- Mitsubishi Corp (8058 JP) is looking to raise US$100m via trimming a portion of its stake in Ayala Corporation (AC PM).
- Despite being not explicitly well flagged, Mitsubishi had sold before back in Jan 2019, and in Mar 2018. Thus, we would argue that the deal here is somewhat expected.
- While the deal would represent 43 days of the stock’s three month ADV, the recent selldowns by Mitsubishi had held up in the first week.
Suruga Bank – Only 33% of Buyback Done, Profit Guidance to Rise a Lot, Credit Saison Support Growth
- Only about 1/3 of of the recently announced share buy back is done, the remainder will come from now through end of March 2024.
- Earnings are far higher than the bank’s forecast, and there should be a major revision in coming weeks.
- Credit Saison collaboration and exiting BOJ negative rate policy, should provide a multitude of positives, for revenue growth.
[Week 16] Namaste India 🙏 | More Smoke for Bandhan?
- The upcoming earnings season, along with the forthcoming Budget and Elections, should all contribute to keeping the undertone bullish for the NIFTY Index (NIFTY INDEX).
- Bandhan Bank Ltd (BANDHAN IN) reported a minor dip in collections for the non-EEB portfolio, which has probably spooked the street.
- Other names discussed include MMFS, POONAWAL, AUBANK, LTFH, and AAVAS.
[KE Holdings(BEKE US, BUY, TP US$24.5) Update]: Singaporization of Real Estate Has LT Plus, ST Minus
- A new draft measure suggested Shenzhen is planning to accelerate its shantytown renovation and offer more Affordable Houses to meet demand of low-income groups, mimicking Singapore’s HDB flat policy.
- As China’s property market gradually heading to the Singapore model, we expect the existing home market to enlarge and new home market to shrink.
- We expect Beike existing home business and renovation business to benefit, while new home business hurts. We maintained the stock as BUY rating and TP at US$24.5/ADS.
EQD | KOSPI 200 Readying for LONG Reversal
- The KOSPI 200 INDEX is correcting after a long multi-week rally. Currently down for 2 weeks (to be confirmed this Friday at close), it’s becoming OVERSOLD.
- There is a risk of a large slide during this week, so LONG trades should be taken with a careful, hedged approach, but the LONG reversal is pending…
- The price area between 345 and 334 is where the index could stop its pullback and reverse.
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