In today’s briefing:
- Ecopro BM KOSPI Transfer Listing Disclosure
- Block Deal Sale of 5% Stake In SFA Engineering by Samsung Display
- Ecopro BM (247540 KS): Index Impact of KOSDAQ to KOSPI Transfer
- Ecopro BM: Announces It Will Switch Listing from KOSDAQ to KOSPI
- Constituents of the 1st Corporate Value Up ETF in Korea
- Samsung KoAct Dividend Growth Active ETF: A Look at the First Corporate Value-Up ETF
Ecopro BM KOSPI Transfer Listing Disclosure
- The schedule includes submitting the transfer listing application post-EGM on March 26th. KRX approval expected in 4-6 weeks due to Ecopro BM’s financial soundness. KOSPI listing follows in 2-3 weeks.
- As for KOSDAQ 150 ad-hoc change, it will be replaced with the top reserved issue. The anticipated timing for this ad-hoc change is around mid or late May.
- Following Feb 7 disclosure, stock surged over 10% in 2 days. Precedents show rallies pre-shareholder meetings, but KOSPI listing brings corrections. Today’s resolution could boost Ecopro BM short term.
Block Deal Sale of 5% Stake In SFA Engineering by Samsung Display
- After the market close on 27 February, Samsung Display announced that it will sell its 4.95% stake in Sfa Engineering (056190 KS) in a block deal sale.
- We would take the trade. We like the relatively large block deal sale discount as well as the company’s attractive valuations.
- SFA Engineering is trading at P/E of 8.3x, EV/EBITDA of 2.7x, and P/B of 0.7x in 2024, which are much lower than historical valuations.
Ecopro BM (247540 KS): Index Impact of KOSDAQ to KOSPI Transfer
- Ecopro BM (247540 KS)‘s Board has approved the delisting of the stock from the KOSDAQ market and to list on the KOSPI market. The shareholder meeting is on 26 March.
- Historically, the KRX has taken an average of 64 days from application to approve the listing to transfer from the KOSDAQ market to the KOSPI market.
- Ecopro BM (247540 KS) will be deleted from the KOSDAQ 150 Index on its last trading day and inclusion in the KOSPI 200 Index could take place in September.
Ecopro BM: Announces It Will Switch Listing from KOSDAQ to KOSPI
- After the market close on 27 February, Ecopro BM (247540 KS) announced that it will switch its listing from KOSDAQ to KOSPI.
- Ecopro BM currently has a market cap of 23.1 trillion won. It is the largest stock in KOSDAQ right now and it would be the 17th largest stock in KOSPI.
- Lofty valuation is one of the main reasons why we continue to be bearish on Ecopro BM. It is trading at P/E of 203x in 2024 and 71x in 2025.
Constituents of the 1st Corporate Value Up ETF in Korea
- Samsung Active Management launched the first Corporate Value Up ETF called KoAct Dividend Growth Active ETF on 27 February. It also revealed some of the major constituents of this ETF.
- Samsung Active Management revealed the top 20 constituents of this ETF, which comprised 73.2% of the total ETF AUM.
- In the coming weeks, there will be many other Corporate Value Up related ETFs that will be created that are similar to Samsung’s KoAct Dividend Growth ETF.
Samsung KoAct Dividend Growth Active ETF: A Look at the First Corporate Value-Up ETF
- The Samsung KoAct Dividend Growth Active ETF (476850F.KS) raised around US$7.4m and started trading on 27 February.
- There are 45 stocks in the ETF and the aim is to beat the Korea Stock Exchange Kospi Index (KOSPI INDEX) by employing an active management strategy.
- Financials, Consumer Discretionary and Industrials stocks make up nearly two-thirds of the ETF, the dividend yield of the underlying basket is 4% and the forward dividend yield is slightly higher.
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