In today’s briefing:
- LG Energy Solution (373220 KS) IPO: Index (Fast) Entry & Lock-Up Expiry Summary
- S&P/ASX Indices: Quiddity Leaderboard for March 2022 Rebalance
- Beijing Jingneng (579 HK): Trading Cheap As Possible Offer Reload Looms
- Ausnutria (1717 HK): SPAs Done (Just Not Officially)
- Huya – If Douyu Is Being Taken Private Huya Should Be Too
- Hang Seng TECH Index Rebalance Preview (March 2022): SenseTime Could Be Added with HUGE Impact
- KODEX Battery ETF Rebalancing Cycle Changed to Quarterly: Preview for March Rebalancing
LG Energy Solution (373220 KS) IPO: Index (Fast) Entry & Lock-Up Expiry Summary
- LG Energy Solution (373220 KS) listed today and closed 68.3% above its IPO price to become the second largest stock in Korea with a full market cap of US$98.22bn.
- The stock will be added to a bunch of indices via Fast and Regular entry over the next few months. There will be liquidity squeezes on a few of them.
- LG Energy Solution (373220 KS) will become short sell eligible on 11 March after its inclusion in the Kospi 200 Index. That and lock-up expiry is something to watch for.
S&P/ASX Indices: Quiddity Leaderboard for March 2022 Rebalance
- The S&P/ASX Index family is a widely-tracked group of indices and sub-indices which represent the performance of ASX-listed companies.
- In March 2022, Index rebalance events will take place for the S&P/ASX capitalization-weighted indices including ASX 300, ASX 200, ASX 100, ASX 50, and ASX 20.
- In this insight, we take a look at the leading candidates who could become Adds/Deletes during the March 2022 Rebalance and other potential intra-quarterly changes.
Beijing Jingneng (579 HK): Trading Cheap As Possible Offer Reload Looms
- Beijing Jingneng Clean Energy (579 HK), whose privatisation unceremoniously failed last year, is inexpensive versus its peer basket.
- The 12-month moratorium restricting Beijing Energy Holding from relaunching an Offer expires on the 1 March.
- The key reason for privatisation remains. A new Offer should be structured such that no tendering condition is present.
Ausnutria (1717 HK): SPAs Done (Just Not Officially)
- 530.8mn shares of Ausnutria (1717 HK) crossed at the close yesterday at HK$10.06/share. That is the exact number of shares under the SPAs and the stated price under the agreements.
- China’s NDRC approval, a condition to the SPAs, was obtained earlier this month, leaving MoC and SAFE approvals outstanding. They appear to have been received.
- Expect confirmation shortly. The completion of the SPAs triggers an MGO, which is conditional on Inner Mongolia Yili Industrial Group (600887 CH) holding 50% of the voting rights.
Huya – If Douyu Is Being Taken Private Huya Should Be Too
- Tencent is reportedly considering taking Douyu private, potentially in partnership with a PE fund.
- Given weak earnings and reports of strategic confusion within management this is not entirely surprising.
- While the news is positive for Douyu we would prefer to look one connection away at the implications for the less troubled Huya.
Hang Seng TECH Index Rebalance Preview (March 2022): SenseTime Could Be Added with HUGE Impact
- SenseTime Group (20 HK) listed just prior to review cutoff and will be eligible for inclusion in the Hang Seng Tech Index (HSTECH INDEX) at the March rebalance.
- We expect SenseTime Group (20 HK) to be added to the index and replace Autohome (2518 HK) at the close of trading on 4 March.
- The real float of SenseTime Group is much lower than what HSIL is likely to use. Expect a BIG squeeze if the stock is added at a higher float.
KODEX Battery ETF Rebalancing Cycle Changed to Quarterly: Preview for March Rebalancing
- The rebalancing cycle of the KODEX Secondary Battery ETF was changed from semi-annual to quarterly. Also, the rebalancing trading takes place for three trading days instead of one trading day.
- This passive impact will be different from the previous rebalancing. LG Energy and SK Innovation will likely experience a significant passive outflow. Then, most small-cap constituents will receive an inflow.
- Among the top weighting stocks, Samsung SDI and SKIET deserve attention. Sangsin Energy, E&D, and TSI will face exclusion, while C&I, Sang-A Frontec, and Enchem will likely join the ETF.
Before it’s here, it’s on Smartkarma
