Daily Brief South Korea: Jeisys Medical, Korea Stock Exchange KOSPI 200, Posco M-Tech, Samyang Foods, Cuckoo Holdings, Hugel Inc and more

• Aesthetic laser maker Jeisys Medical (287410 KS) has announced French PE outfit Archimed SAS is seeking to delist the company.
• Archimed intends to acquire 72% of Jeisys at ₩13,000, a 20.82% premium to undisturbed. Archimed has also inked agreements with founders/directors for 26.44%, taking its possible % acquisition to 98.44%. 
• A Korean medical device maker – not another Eoflow (294090 KS)?! Jeisys did face a patent infringement case from Syneron Medical (ELOS US) in 2018; but since resolved. 

• The government will announce short selling improvements Thursday. A leaked detail includes limiting 90-day short position extensions.
• Limiting the 90-day short position holding period may ease local investor concerns, but it could shrink the short selling market, potentially affecting overseas fund outflows.
• Resuming short selling in early July may bring new flow patterns due to temporary distortions from mandatory repayment within 90 days and limitations on position extensions, increasing price impacts.

• KRX announced KOSDAQ Global rebalancing. Annually in June, effective date follows June options expiry. Passive flow trading on Thursday, the 13th. 49 companies designated, with nine excluded and eleven added.
• Predicting passive capital movement is challenging, but attention must be given to price impacts because reshuffle predictability is low, lacking preemptive trading setups.
• We must anticipate the SSF reshuffle in August, likely including new KOSDAQ Global constituents. KRX plans to list SSFs for all remaining constituents, potentially advancing setup timing for price increases.

• One of the key themes this year that has worked well has been Korean food & beverage stocks that have significantly outperformed KOSPI. 
• Some of the best selling Korean foods (especially overseas) include Samyang Foods’ instant noodles, CJ Seafood’s seaweed products, and Wooyang’s frozen gimbab. 
• We prefer a basket approach to investing in Korean F&B stocks. A basket of top 10 F&B stocks in Korea has outperformed the market YTD and this outperformance could continue.

• Cuckoo Holdings is known for its high-quality rice cookers popular among Asians, particularly Koreans
• Stock price of the company has increased due to its success, with dividends rising from 800 to 1,100 per share
• South Korea’s “value-up” program may further boost the company’s growth and attract more investors as the importance of rice in Korean cuisine creates a strong market for its products

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Hugel Inc (145020 KS) got favorable preliminary ruling in US for its litigation with Medytox. The ruling revealed that the competitor’s claim of strain theft by Hugel is baseless.  
• In March, Hugel received FDA approval for BTX product, Letybo in US. The company plans to launch Letybo in 2H24, while final ruling for the litigation is scheduled in October.
• As BTX and HA filler grew steadily in domestic and overseas markets, 1Q24 sales grew 15% YoY to KRW74.3B, achieving the highest ever performance in the first quarter.