Daily Brief Industrials: HDC Hyundai Development Co-Engineering & Construction, Adani Ports & Special Economic Zone, LX International, BOC Aviation, Cirrus Aircraft, Amaero International Ltd and more

• There will be 7 additions and 7 deletions for the Korea Stock Exchange KOSPI 200 (KOSPI2 INDEX EQUITY) at the December rebalance that will be implemented on 14 December.
• The rebalance is on expected lines, though the index committee decided not to add Youngpoong Paper (006740 KS) to the index. Not really a big surprise given the price move.
• HDC Hyundai Development Co-Engineering & Construction (294870 KS) is a surprise delete and there is not much short interest that could cover against the passive selling.

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.

• Adani Ports & Special Economic Zone
• Agung Podomoro Land

• LX International announced today that it will not participate in the main bidding to acquire HMM Co.
• This is likely to have a positive impact on LX International’s share price as many investors are relieved that company will not raise excessive amounts of capital to acquire HMM.
• In addition, by not acquiring HMM, LX International has enough financial resources to continue to pay high dividends. 

• BOC Aviation (2588 HK) (BOCA) is the highest-quality aircraft leasing company, with a young asset portfolio, quality clientele, cheapest credit facility, and superb risk management.      
• Outlook is attractive, strong demand and scarce supply ensures high lease rates and profits. Asset disposals have all recorded a healthy surplus, a potential earnings surprise. 
• Our TP of HKD70/share implies 0.94x FY24 (22% UPSIDE) potential 

• Cirrus Aircraft (0153126D US) is looking to raise up to US$200m in its upcoming HK IPO.
• Cirrus Aircraft designs, develops, manufactures, and sells premium aircrafts. Its two aircraft product lines, the SR2X Series and the Vision Jet, are currently certified and validated in over 60 countries.
• We had covered the company’s performance in our earlier notes. In this note, we talk about its PHIP updates.

• Amaero International Ltd (ASX:3DA) is a global specialist in advanced materials manufacturing for the defence, aerospace, and other industrial sectors.
• The company is developing a 1,000+-tonne-a-year critical metals alloy powder manufacturing facility in Tennessee, USA with its initial focus on producing refractory alloy powder, C103, a critical metal powder used in hypersonics weaponry.
• The company has raised A$10m from new and existing institutional and sophisticated shareholders at $0.16/share, representing a 15.8% discount to the last traded price prior to the raise.