In today’s briefing:
- CES China Semiconductor Chips Index Rebalance: Another Inclusion for Hygon
- Index Rebalance & ETF Flow Recap: HSI, HSCEI, HSTECH, HSCI, Div+, Top50, ASX, FXI, Xiaomi, Tata Tech
- Uchi Technologies (UCHI MK): Solid Q3 2023,ROE >30%/Div Yield >7%
- ECM Weekly (26th Nov 2023) – Zeekr, Cirrus, Tata Tech, IREDA, FedBank, Juniper, GS Yuasa, AZ Com
- SSE50 Index Rebalance: Five Changes; Adds & Deletes Moving in Lockstep
- HK Connect SOUTHBOUND Flows (To 24 Nov 23); ETF Buying Offsets Broad Selling, Especially in Tech
CES China Semiconductor Chips Index Rebalance: Another Inclusion for Hygon
- There are 3 changes for the CES China Semiconductor Chips Index that will be implemented at the close on 8 December.
- Hygon Information Technology C (688041 CH) will be added to a global index in a week and then there will be multiple index inflows at the close on 8 December.
- After underperforming from May to September, the adds have gained ground on the deletes over the last two months and there could be further outperformance over the next two weeks.
Index Rebalance & ETF Flow Recap: HSI, HSCEI, HSTECH, HSCI, Div+, Top50, ASX, FXI, Xiaomi, Tata Tech
- The capping for the Hang Seng family of indices will use closing prices from 28 November while implementation will take place at the close on 1 December.
- The changes for the next S&P/ASX 200 (AS51 INDEX) rebalance will be announced after the close of trading on 1 December.
- It was another week of inflows for the iShares Emerging Markets (EMXC US) to take units outstanding to a new high.
Uchi Technologies (UCHI MK): Solid Q3 2023,ROE >30%/Div Yield >7%
- Uchi Technologies (UCHI MK) reported a 15% YoY revenue growth/ 27% YoY operating profit growth led by constant USD revenue growth of 10% YoY and 4.5% MYR depreciation.
- Profit grew only 3.5% YoY due to an increase in the effective tax rate from 2.8% to 21.0% as the company’s tax holidays lapsed earlier this year.
- Trading 12x PE, 7.5% dividend yield (based on a 90% payout), >30% ROE, and more than 10% of the market cap in cash; this a stock to explore.
ECM Weekly (26th Nov 2023) – Zeekr, Cirrus, Tata Tech, IREDA, FedBank, Juniper, GS Yuasa, AZ Com
- Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
- In the IPO space, Tata Technologies didn’t disappoint Tata Group fans, at least on the subscription front.
- The placements continued to flow in this week as well in Japan.
SSE50 Index Rebalance: Five Changes; Adds & Deletes Moving in Lockstep
- There are 5 changes for the SSE50 Index (SSE50 INDEX) that will be implemented at the close on 8 December. There is over 1x ADV to trade on some stocks.
- We estimate a one-way turnover of 5.4% at the December rebalance leading to a one-way trade of CNY 4.85bn. Index arb activity could add to the impact on the stocks.
- The adds, deletes and SSE50 Index (SSE50 INDEX) have moved nearly in lockstep since May and the passive flows could move things around a bit.
HK Connect SOUTHBOUND Flows (To 24 Nov 23); ETF Buying Offsets Broad Selling, Especially in Tech
- This is the somewhat brand-spanking-new Quiddity HK Connect SOUTHBOUND Monitor. We work off the same presentation as the A/H Premium Monitor and Mainland Connect NORTHBOUND Monitor.
- SOUTHBOUND flows the last several weeks clearly indicated a momentum move. The top net sells were all down. The top buys were all up. We saw a pause, then continued.
- SOUTHBOUND sees more net selling this week of stocks. Last week ETF selling turned flows negative. This week, ETF flows flattered the net sell. Tech still being sold.
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