In today’s briefing:
- MV Australia A-REITs Index Rebalance Preview: One Close Delete & Capping Changes
- EQD | Hong Kong Single Stock Options Weekly Nov 25-29
- STOXX 600 EU December 2024 Forecast: A Schibsted Gamble, a SpareBank Surge, and a Carnival Party
- Indian Banks Screener: Stick with Buys on Select, Value Based Smaller Caps
- JPEL Private Equity: A Free Lunch
MV Australia A-REITs Index Rebalance Preview: One Close Delete & Capping Changes
- The review period for the December rebalance ended on 29 November. There could be one deletion, plus there will be capping changes.
- Waypoint REIT (WPR AU) is the lowest ranked current index constituent and is very close to the deletion threshold.
- We estimate the one deletion and capping changes could result in one-way turnover of 3.6% resulting in a one-way trade of A$23m.
EQD | Hong Kong Single Stock Options Weekly Nov 25-29
- Put trading was heavy in the Financial sector this week. ICBC and Bank of China were the main contributors to that with 73% and 63% of their volume in Puts.
- ANTA Sports Products had a notable pick up in Call activity this past week as the stock bounces around 3 year lows vs the Hang Seng index (graph at bottom)
- Energy and Real Estate sectors might be the best area to look for low vol opportunities.
STOXX 600 EU December 2024 Forecast: A Schibsted Gamble, a SpareBank Surge, and a Carnival Party
- SpareBank 1 Sr-Bank (SRBANK NO) is the number one addition candidate following the merger with SpareBank 1 Sørøst-Norge which increased the security’s float shares.
- Schibsted ASA (SCHB NO) – Class B – is estimated to have surpassed Class A in liquidity which deems it eligible for selection with a high conviction.
- Carnival PLC (CCL LN) is one of the top three addition candidates after experiencing a ~50% price rally over the last three months.
Indian Banks Screener: Stick with Buys on Select, Value Based Smaller Caps
- Our positive focus remains on three smaller cap Indian banks, namely Bandhan, Baroda and Union Bank of India (UBI); we stay negative on richly valued ICICI Bank and Kotak Mahindra
- Bandhan has its NPL challenges, but its pre-provision returns have improved and it is a value stand-out; Baroda remains our favourite and UBI has delivered better profitability and credit quality
- Kotak Mahindra is the peer group’s highest return bank post credit costs, but returns continue to erode; ICICI is on premium valuations and we expect credit costs to go higher
JPEL Private Equity: A Free Lunch
- The UK market currently has a lot of companies trading at very cheap valuations, some justifiably, some less so.
- Liquidity and investor interest has just dried up as UK equities have seen 2 straight years of record outflows.
- I’ve found success this year specifically looking at asset backed financial entities such as GABI and DNA2.
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