In today’s briefing:
- MVIS Global Rare Earth/Strategic Metals Index Rebalance: Three Adds; Float & Capping Changes
- MVIS Australia Equal Weight Index Rebalance: Two Deletions & Other Changes
- Conscious De-Stapling With Uplift – The Abacus Property (ABP) Storage Spinoff
- Lutronic (085370 KS): Hahn & Co Tender Offer
- Keisei Electric: Distorted Valuation Unveils Opportunity for Activist Investors
- Seino (9076) – More Seino, Seino More. Know What I Mean? Eh Eh? Seino Goes Big on Capital Policy
- KOSPI Index – Banks Hardly Participating
- Mason (273 HK): Red Emerald’s Scheme
- HSCEI Index Rebalance Preview: Two Changes Likely in September
- Ohayo Japan |BIG TECH BACK ! NUGGET: Nidec Succession Headaches-Resolution in Sight But…
MVIS Global Rare Earth/Strategic Metals Index Rebalance: Three Adds; Float & Capping Changes
- There are 3 inclusions for the MVIS Global Rare Earth/Strategic Metals Index at the June rebalance. Plus there are free float and capping changes.
- One way turnover is estimated at 10.6% and will result in a one-way trade of US$66m. There are a few stocks with over 0.5 days of ADV to trade.
- Yunnan Chihong Zinc&Germanium Co, Ltd. (600497 CH) was not added to the index while ioneer Ltd (INR AU) has avoided deletion in June.
MVIS Australia Equal Weight Index Rebalance: Two Deletions & Other Changes
- Ansell Ltd (ANN AU) and Challenger Ltd (CGF AU) will be deleted from the MVIS Australia Equal Weight Index at the close of trading on 16 June.
- One way turnover is 5.9% resulting in a one-way trade of A$107m. Only the two deletions have more than 1 day of ADV to sell from passive trackers.
- With the passive selling between 33-50% of short interest on the deletions, there could be short covering at the close on Friday.
Conscious De-Stapling With Uplift – The Abacus Property (ABP) Storage Spinoff
- Back in February with the H1 results announcement, Abacus Property (ABP AU) announced an intention to spin off an ASX-Listed Self Storage REIT with A$3bn in total assets.
- The stock popped 7.4% to A$3.06 but is -16% since. In April they dropped their equity holding in National Storage REIT (NSR AU), in May they updated again.
- Last week they had a big new Investor Presentation saying they would go ahead. There’s a trade in here.
Lutronic (085370 KS): Hahn & Co Tender Offer
- On 9 June, skin and cosmetic treatment play Lutronic Corp (085370 KS) announced a Tender Offer from Korean PE outfit Hahn & Company.
- After acquiring 19.41% from Lutronic’s CEO at ₩ 36,700, Hahn will launch an Offer for all remaining shares at the same price.
- This Offer Price is a lifetime high. There is no minimum tendering condition.
Keisei Electric: Distorted Valuation Unveils Opportunity for Activist Investors
- Surpassing the pre-COVID average of 49%, the NAV discount currently stands at 61%, implying potential 12% market-neutral returns in the short-term through the recovery of the core transportation business.
- Activist investor influence in distributing Keisei Electric’s ¥1,980bn Oriental Land (4661 JP) stake to existing shareholders could unleash over 150% potential upside, surpassing the earlier mentioned 12% gain.
- Thus, there is high likelihood of Keisei Electric Railway Co (9009 JP)‘s continued outperformance over Oriental Land in the medium term.
Seino (9076) – More Seino, Seino More. Know What I Mean? Eh Eh? Seino Goes Big on Capital Policy
- Three years ago, Seino Holdings (9076 JP) delivered a lot of its cash back to shareholders in a big buyback. They bought back almost 15mm shares (7.5%).
- Since then, they’ve bought another 2.5%. In February, they changed their Dividend Policy to max(2.4% DOE, 30% payout ratio). Then they set a cap and floor on the dividend.
- Four months later they have a new MTMP, and a new Dividend Policy. Simple. 4.0%+ DOE. Div +70% vs last year. Oh… and there’s an 11% buyback.
KOSPI Index – Banks Hardly Participating
- The KOSPI Index has done well in recent weeks, months, but financials are hardly participating
- There are vast differences amongst the financial in Korea, not only large Chaebol-like banks
- Kakaobank, one of few listed internet banks in the world, is unique with ROA expansion
Mason (273 HK): Red Emerald’s Scheme
- After broker Mason Group (273 HK) was suspended pursuant to Hong Kong’s Takeovers Code on the 31 May, it has now announced a privatisation by way of Scheme at HK$0.0338/share.
- The Offer price is only a 20.7% premium to last close, and a 12.7% premium to the three-month average closing price. It has not been declared final.
- The Offeror is Red Emerald. Shareholders with 47.55% of shares out have given irrevocables in support of the Scheme.
HSCEI Index Rebalance Preview: Two Changes Likely in September
- Trip.com (9961 HK) and Chow Tai Fook Jewellery (1929 HK) could replace Country Garden Services Holdings (6098 HK) and Zhongsheng Group (881 HK) at the upcoming rebalance in September.
- Estimated one-way turnover at the rebalance is 1.2% resulting in a one-way trade of HK$744m. The official capping will be done based on closing prices from 29 August.
- Short interest has been rising on the potential adds and short covering could take the stocks higher, especially Chow Tai Fook Jewellery (1929 HK).
Ohayo Japan |BIG TECH BACK ! NUGGET: Nidec Succession Headaches-Resolution in Sight But…
- OVERSEAS. NDX100 +1.8% SOX +3.3% vs. SPX +0.9% DOW +0.6%; Tech back ahead of Fed; Energy a different story as Oil fell on D-S worries; All eyes remain on CPI/Fed
- JAPAN. NKY Futs +0.7% premium vs Cash; Japan lead yesterday vs US..rarity; Expect continued Equity follow through; Seino HD(9076) -Massive Buyback, Div hike; TOYOTA-Path to Solid State Battery Commercialization?
- NUGGET. Nidec Succession Resolution in Sight, but Nagamori Premium May Dissappear
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