In today’s briefing:
- TOPIX FFW Transition – Big Flows from April to June
- GoTo Gojek Tokopedia IPO: Potential LQ45, IDX30, IDX80 Index Fast Entry & Impact
- MSCI May 2022 Index Rebalance Preview: Last Week Before the Start of the Review Period
- Tabcorp’s Valuation Discovery into the Demerger
- Merger Arb Mondays – Yashili, Pendal, Sezzle, Razer, Link Admin, Uniti, AKM, Guodian, Crown Resorts
TOPIX FFW Transition – Big Flows from April to June
- On 7 April, the JPX announced the changes to the Free Float Weights (FFW) for the TOPIX Index. There are some big changes due to the updated FFW methodology.
- From April to June, we see a one-way turnover of 2.87% and a one-way trade of ¥2,285bn. Some stocks have opposite way flows in different months.
- Stocks with inflows outperformed stocks with outflows from Oct-Dec 2021 before giving up all the gains. These stocks have started to outperform and could continue outperforming over the next quarter.
GoTo Gojek Tokopedia IPO: Potential LQ45, IDX30, IDX80 Index Fast Entry & Impact
- GoTo (GOTO IJ) lists on the IDX tomorrow. The IDX has GoTo (GOTO IJ)‘s free float at 66% which would mean IDX30, LQ45 and IDX80 Fast Entry index inclusion.
- If included in the indices at a free float of 66%, GoTo (GOTO IJ) will have a weight of 13.55% in the IDX30 Index and 12.12% in the LQ45 Index.
- Passive trackers will then need to buy 13.2% of the real float on the stock. Active funds will also buy the stock as it would appear in their benchmarks.
MSCI May 2022 Index Rebalance Preview: Last Week Before the Start of the Review Period
- This is the last trading week before the review period for the MSCI May SAIR commences next week. This is a short week with a lot of markets closed Friday.
- We see 38 potential adds and 63 potential deletes across Asia. Most changes are in China, with the most net deletions in Japan and China.
- The largest potential inclusions are Powerchip Semiconductor Manufacturing, Orient Overseas International, Pop Mart International, Jindal Steel & Power, Eva Airways, Emtek, China Airlines, Sumber Alfaria Trijaya and KT Corp.
Tabcorp’s Valuation Discovery into the Demerger
- Tabcorp Ltd (TAH AU)’s demerger will create two standalone companies listed on the ASX – The Lottery Corporation and New Tabcorp
- The scheme meeting to approve the demerger will be held on 12 May at 10.00 am. The Lottery Corporation will trade on a normal settlement basis on 2 June.
- This transaction aims to unlock value. Our SoTP valuation is A$6.13 per share, which is a 14% upside to the last close price of A$5.39 per share.
Merger Arb Mondays – Yashili, Pendal, Sezzle, Razer, Link Admin, Uniti, AKM, Guodian, Crown Resorts
- We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore and the US (Chinese ADRs only).
- This week, the highest gross spreads are Yashili International Holdings (1230 HK), Pendal Group (PDL AU), Sezzle Inc (SZL AU), Razer Inc (1337 HK), Link Administration Holdings (LNK AU).
- The lowest gross spreads are Uniti Group Ltd (UWL AU), 51 Job Inc Adr (JOBS US), China Logistics Property Holdings (1589 HK), Irongate Group (IAP AU), Jin Jiang Capital.
Before it’s here, it’s on Smartkarma
