Daily Brief Financials: Shin Kong Financial Holding, Huafa Property Services Group, NIFTY Index and more

In today’s briefing:

Shin Kong (2888.TW) And Taishin (2887.TW) Agree to Merge, But It Isn’t Clean, And It’s A Bad Price
Huafa Property Services (982 HK): What’s Going on as Shares Trades Very Wide Ahead of the Vote?
EQD / NSE Vol Update / Smile & Skew Compress as Vols Trade to New Summer Lows

Shin Kong (2888.TW) And Taishin (2887.TW) Agree to Merge, But It Isn’t Clean, And It’s A Bad Price

After rumours were rekindled a week earlier, on 22 August 2024, Taishin Financial Holding (2887 TT) and Shin Kong Financial Holding (2888 TT) announced they would merge.
The ratio is 0.6022 shares of Taishin for every share of Shin Kong putting NEWCO assets at about the level of Taiwan #3 CTBC Financial. That’s bad.
There’s history here. LOTS of history. This would need approvals from the FSC and FTC, but CTBC is already a spoiner, and the SKFH Board Meeting was anything but clean.

The Huafa Property Services Group (982 HK) vote on Huafa Industrial Co., Ltd. Zhuhai (600325 CH)’ HK$0.29 offer is on 28 August. However, shares trade wide ahead of the vote.
Several readers have enquired about the unusually high spread ahead of the vote of a seemingly clean deal. The conversations raised several concerns.
The concerns are unwarranted, and this remains a clean deal. At the last close and for the 30 September payment, the gross/annualised spread was 5.5%/68.9%.

IVs have moved to new lows for the summer, breaking below the floor set through June & July. Nifty50 IVs now trading at 11.0% levels.
Spectacular turnaround in IVs since early-August vol-spike. In spite of this, Vol Regime remains steady in its “High & Down” vol-state.
Nifty50 Vol surface characteristics have compressed for Monthly-expiry contracts. Smile & Skew for Quarterly contracts remain unchanged.

💡 Before it’s here, it’s on Smartkarma

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network