In today’s briefing:
- Notable Developments in the November Review of the Global Index Korea Standard
- Doosan Mergers: One Canceled, One Still Moving Forward
- Doosan Group Cancels Plans to Merge Doosan Robotics and Doosan Bobcat
- Timee IPO: Trading Update
- Shenzhen Intl (152 HK): Topping Positive Profit Alert Range
- Monthly Chinese Express Tracker | July Volume Growth Eased | Price Declines Moderating (August 2024)
Notable Developments in the November Review of the Global Index Korea Standard
- Hyundai Rotem is right on the edge for Small Cap→Standard, so it is the only one having a real chance of being included in the November review.
- Doosan Robotics’ float rate will rise to 40% after issuing 20,219,376 new shares, making it a top candidate for inclusion among Outside IMI and comfortably surpassing the cutoff.
- With high trading volume volatility, it’s early to predict passive impact. Watch for momentum buildup like LS Electric and monitor the trading volume of Hyundai Rotem and Robotics closely.
Doosan Mergers: One Canceled, One Still Moving Forward
- Maekyung reported that Doosan Robotics and Bobcat will cancel their merger, but the merger between Robotics and Enerbility’s spun-off company will proceed.
- The merger’s risks have been overblown in Robotics’ stock, which might rebound. Bobcat’s stock outlook is uncertain, with fading merger hopes potentially hurting short-term sentiment.
- The Robotics-Enerbility merger might also be canceled under regulatory pressure, but this could hurt Enerbility’s stock due to debt concerns; forcing the merger may increase costs.
Doosan Group Cancels Plans to Merge Doosan Robotics and Doosan Bobcat
- On 29 August, the Doosan Group announced that it is cancelling the merger between Doosan Robotics (454910 KS) and Doosan Bobcat Inc (241560 KS).
- However, the plan to split Doosan Enerbility into a newco and then merge Doosan Bobcat with the newco will remain in place.
- Doosan Group is still trying to complete the first two portions of reorganization (Split of Doosan Enerbility and Merger Swap Between Doosan Enerbility and Doosan Robotics), resulting in continued uncertainty.
Timee IPO: Trading Update
- Timee began trading on 26th July and share price has surged 47% since its debut where the company priced the IPO at top of the indicative price range.
- Though Timee Inc (215A JP) is in early stages, the company has proven that its business model is successful and continue to dominate a market that is underpenetrated.
- Though we think there is further upside, if you have already bought shares at the IPO, we would suggest taking profits and wait for a dip to make a re-entry.
Shenzhen Intl (152 HK): Topping Positive Profit Alert Range
- Shenzhen International (152 HK) reported 1H24 net profit of HK$653m. While toll road and other segments are under pressure, the logistics segment has benefited from REIT issuance.
- In 2H24, it may book profit from the initial land appreciation gain from the South China Logistics Park transformation and profit from the 50%-owned Yicheng Zhenwanyue.
- SZI seeks to realise the value of its assets. At 0.4x P/B or 1SD below the 5-year average, the stock, with a 7.5% yield, is deeply undervalued.
Monthly Chinese Express Tracker | July Volume Growth Eased | Price Declines Moderating (August 2024)
- Chinese parcel volume growth slowed in July (+22%) vs firmer pace in Q2 (+32%)
- At company level, there are signs the steep price declines from H1 are moderating
- If worst of price declines is in rearview mirror, beat down names are worth a look
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