In today’s briefing:
- Korean Government’s Official Statement on Foreign Ownership Limits & The Names Still to Watch
- MSCI Korea May QCIR: Potential Changes, Impact, Positioning & Short Interest
- Bionote Lock-Up – Uncertainty on the Horizon, Likely to See Some Selling Pressure
- Potential Inclusions & Exclusions in KOSDAQ 150 Rebalance in May 2023
Korean Government’s Official Statement on Foreign Ownership Limits & The Names Still to Watch
- Hankyung exclusively reported that the Korean regulators were considering abolishing the foreign ownership limit. This morning, the Ministry of Economy and Finance released a statement that this report is untrue.
- Nevertheless, circumstantially, given the current government’s all-out effort to make it to MSCI Developed Market status, there is a high possibility that it will resurface not too far from now.
- Four out of the 33 foreign ownership-restricted stocks will likely be immediately affected: SKT, KT, and Korea Gas (MSCI inclusion) and SBS (flow improvement).
MSCI Korea May QCIR: Potential Changes, Impact, Positioning & Short Interest
- We currently forecast 2 potential inclusions and 3 potential deletions for the MSCI Korea Index at the May QCIR. That will change over the next few weeks till cutoff date.
- Passive trackers are estimated to buy between 0.6-3.3 days of ADV on the potential inclusions while selling between 6.9-14.2 days of ADV on the potential deletions.
- Short interest on the potential deletions has moved significantly higher in the last few weeks and there will be pre-positioning on the stocks.
Bionote Lock-Up – Uncertainty on the Horizon, Likely to See Some Selling Pressure
- Bionote (377740 KS) was listed on 22nd Dec 2023, when it raised US$73m in its downsized Korean IPO. Its three-month lockup will expire on 21st Mar 23.
- Bionote is an integrated producer of diagnostics test products and biocontent products. Based on its unique recombinant antigen and antibody manufacturing technology, the firm researches and develops diagnostic reagent products.
- Coming up for three-month lockup expiry are the firm’s three pre-IPO investors, together with Gunwoo Ha (ex-CEO). The three pre-IPO investors had earlier trimmed their respective stakes in the IPO.
Potential Inclusions & Exclusions in KOSDAQ 150 Rebalance in May 2023
- In this insight, we discuss the potential inclusions and exclusions of the upcoming KOSDAQ 150 rebalance in May 2023.
- The next round of KOSDAQ 150 rebalance will be announced in May and it will be effective as of end of May 2023.
- Typically, the potential inclusions and exclusions to KOSDAQ 150 make their biggest moves in the one to three months prior to the rebalance announcements.
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