Daily Brief South Korea: LOTTE Corporation, Samsung C&T, Kakao Games Corp and more

In today’s briefing:

MSCI Korea November SAIR: Three Adds & Four Deletes
Korean Holdcos Vs Opcos Gap Spreads Opportunities Amid Market Carnage
ECM Weekly (16th Oct 2022) – Socionext, Betagro, Lionheart, Five-Star, Giant Biogene, GLP J-REIT

MSCI Korea November SAIR: Three Adds & Four Deletes

As the recent share price volatility has grown, there have been significant changes in those on the borderline at the MSCI November SAIR.
Additions: Hyundai Mipo Dockyard (010620), LOTTE Corp (004990), and Ecopro (086520) & Deletions: Meritz Financial Group (138040), Amorepacific Group (002790), SK Chemicals (285130), and Green Cross (006280).
We must wait on many names until the end, making the price impact more dramatic than usual, as the flow can be concentrated after the announcement.

In this insight, we highlight the pricing gap divergence of the major Korean holdcos and opcos amid market carnage.
In general, more holdcos/quasi-holdcos have been outperforming the opcos in the past year, as compared to the previous years as more investors seek value-oriented, deep NAV discount stocks.
We highlight 26 pair trades that involve Korean holdcos and opcos.

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
On the IPO front, Socionext (6526 JP) provided a welcome respite with a positive listing, while South Korean IPOs continued to struggle.
There was only one large placement this week, with GLP J-REIT (3281 JP) deciding to brave the markets.

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