In today’s briefing:
- ASX100/200/300 Index Rebalance Preview (March 2022): A Lot Happening From Now to March
- Nippon Building Fund (8951) – Calculating Passive Tracking of J-REITs and Index Events Around Offers
- LG Energy IPO – Peer Updates + Bull/Bear Scenarios
- Jinchuan International (2362 HK): Thoughts On A Rumoured Offer
- Toshiba – The 3D Dilemma
ASX100/200/300 Index Rebalance Preview (March 2022): A Lot Happening From Now to March
- There could be 2 changes to the ASX100 and ASX200 prior to the March rebalance due to the acquisitions of Ausnet Services (AST AU) and Sydney Airport (SYD AU).
- There will also be the large BHP Group (BHP AU) upweight and funding trade following unification, and possibly the Afterpay Touch (APT AU) acquisition by Square Inc (SQ US).
- Then there will be more changes to the ASX200 and ASX300 at the March rebalance. There could be a lot of new listings included in the ASX300.
Nippon Building Fund (8951) – Calculating Passive Tracking of J-REITs and Index Events Around Offers
- Nippon Building Fund (8951 JP) announced a smallish primary offering to assist in funding a portion of its Asset Replacement Campaign involving sales and purchases and an uplift in DPU.
- That is an occasion to look at how much of float is held by passive trackers.
- A test was done on the top 10 J-REITs on a holder-by-holder basis to see what one could expect at a minimum. The result may surprise some.
LG Energy IPO – Peer Updates + Bull/Bear Scenarios
- LG Energy Solution (LGENERGY KS) (LGES) is looking to raise up to US$10.8bn in its upcoming South Korea IPO.
- LGES is the EV battery unit of LG Chem. It was spun off in December last year. The company is a major supplier to customers including Tesla and General Motors.
- In this note, we discuss our blue sky and bear assumptions and take a look at how peers have traded since our previous note.
Jinchuan International (2362 HK): Thoughts On A Rumoured Offer
- Shares have declined ~9% since copper/cobalt miner Jinchuan Group International Resources (2362 HK) said it was unaware Jinchuan Group, its largest shareholder, was proposing a privatisation plan.
- As the world moves towards alternative energy sources, copper will remain in high demand. Jinchuan is also China’s third-largest cobalt refiner, whose output is used in lithium-ion batteries.
- Jinchuan is not expensive. And taking the company private is not a significant outlay for Jinchuan Group. Especially ahead of the copper/cobalt Musonoi project coming online next year.
Toshiba – The 3D Dilemma
- After a brief respite in their never-ending drama over the holiday period Toshiba is again in the news as 3D reiterates their demands for a “review of all options”.
- We have lost count of the number of reviews which haven’t resulted in a PE sale.
- The question is exactly why 3D appears to be so aggressive even relative to other less than bashful activists.
Before it’s here, it’s on Smartkarma
