In today’s briefing:
- Two Trading Opportunities from LG Chem’s Stake Sale in LG Energy Solution
- LG Chem: Considering a Block Deal Sale of About 2 Trillion Won of LG Energy Solution: A Big Overhang
- Alteogen (196170 KS): Milestone Payments and Pipeline Progress Strengthen Business Growth Prospect
- Ottogi Corp: Strong Financial Growth and an Environmental Champion
- Catching Up With CJ Logistics (000120 KS): With Shares Beaten Down, Management Forced to Refocus
Two Trading Opportunities from LG Chem’s Stake Sale in LG Energy Solution
- This issue offers two trading opportunities. The first is the passive inflow resulting from an increase in the float rate. The second is the possibility of additional stake sales.
- It will provide LG Energy with a passive inflow of 760K shares (₩426.4 billion), which is a significant passive impact at approximately 3.2x ADTV.
- There would be further stake sales of LG Chem’s shares in LG Energy. LG Chem plans to pursue additional stake sales targeting local institutional investors.
LG Chem: Considering a Block Deal Sale of About 2 Trillion Won of LG Energy Solution: A Big Overhang
- After the market close on 16 June, it was reported in the local media that LG Chem is close to selling about 2 trillion won worth of LG Energy Solution.
- This block deal sale is likely to pose overhang on more stake sales of LG Energy Solution (about 10% stake) in the next 3-5 years.
- Our NAV valuation analysis of LG Chem suggests an implied price of 1,057,770 won per share, which is 41% higher than current share price.
Alteogen (196170 KS): Milestone Payments and Pipeline Progress Strengthen Business Growth Prospect
- Alteogen Inc (196170 KS)‘s partner has submitted marketing application for Herceptin biosimilar in China. Alteogen will be entitled for royalty after the product is approved and sold in China.
- In April 2023, Alteogen announced that the company will receive additional milestone of $3 million (~KRW4 billion) from its first ALT-B4 technology transfer partner.
- Alteogen has completed patient recruitment for global phase 3 trial for Eylea biosimilar. Marketing application is expected to be filed in early 2024, with marketing expected to start from 1H25.
Ottogi Corp: Strong Financial Growth and an Environmental Champion
- Ottogi Corporation not only achieved remarkable revenue and net income growth in 2022, but also maintained an ESG rating of A for five consecutive years.
- Ottogi demonstrates strong sustainability performance, with high scores in “Environment Policy”, “Chemical Management”, and “Human Rights, Shared Growth & Community”.
- Ottogi’s 10-year dedication to environmental management is evidenced by tangible data, demonstrating remarkable achievements in the management of greenhouse gas (GHG) emissions, energy usage, water consumption, and waste recycling.
Catching Up With CJ Logistics (000120 KS): With Shares Beaten Down, Management Forced to Refocus
- Previously, we criticized CJ Logistics as unfocused, pursuing deals in low-margin segments around the world as if to fill a logistics ‘Bingo!’ card rather than in-line with a rational strategy
- In recent years, investors have punished the company’s shares, which have fallen by more than half since reaching a high of over 184,000 won per share in March 2021.
- However, with management de-emphasizing its Global segment and focusing instead on the more promising Parcel / E-commerce line of business, there is cause for optimism, in our view
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