Daily Brief TMT/Internet: WT Microelectronics, KT Corp, Taiwan Semiconductor (TSMC) – ADR, Microstrategy Inc Cl A and more

• WT Microelectronics (3036 TT) is looking to raise US$341m in its GDR offering. The proceeds will be used to purchase raw materials overseas.
• The deal is a very well flagged one, and will be a relatively small one to digest at just 4.8 days of the stock’s three month ADV.
• In this note, we run the deal through our ECM framework and comment on the deal dynamics.

• KT’s foreign ownership declined since January, below 7.5% by last month. If it remains, the adjustment factor halves to 0.25, impacting KT’s Global Index weight.
• With the May review screening date estimated for April 17th, swift reversal of foreign inflows seems improbable. Thus, KT’s adjustment factor dropping to 0.25 is likely.
• This could lead to an outflow of 1.6M shares, approximately 3x ADTV. Given the prolonged price impact on telcos, exploring a long-short setup with SKT might be prudent.

• TSMC (2330.TT; TSM.US): US$6.6bn from US CHIPS Act; the Earthquake Impact and the 2nd Japanese Fab. 
• Memory Monitor: Nanya’s Results to Provide Latest Color on DRAM Post Earthquake; Short Int Rising 
• UMC (2303.TT; UMC.US): Some Rush Orders Coming in and 2Q24F Could Post Positive QoQ. 

• Approval of bitcoin ETFs by the SEC causing volatility in MSTR shares and bitcoin prices
• Opportunity for a trade pairing short sale of MSTR shares with purchase of bitcoin ETF
• Fluctuating premium of MSTR’s enterprise value over SOTP value, expected to dissipate with approval of bitcoin ETFs

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.