In today’s briefing:
- KRX New Deal Index Rebalance Preview: Potential & Close Changes in September
- KRX Plans to List Single-Stock Futures of All KS200 & KQ150 Constituents
- SET50 Index Rebalance Preview: Two Changes – One High Probability; One Has Possibilities
- Toshiba (6502) – Thinking About the Arb
- Penguin International (PBS SP): Dymon Asia & Co Return with an S$0.82 Unconditional Offer
- Ventia (VNT AU) – Placement Could Lead to ASX200 Inclusion in June
- Ecopro – Is This the Start of the End?
- Nexus Select Trust IPO: Valuation Insights
- Oishi Group: Shareholders Back ThaiBev’s Offer
- Chairman Kim Ik-Rae of Daou Kiwoom Group Resigns & Says Sorry – But Is This Enough?
KRX New Deal Index Rebalance Preview: Potential & Close Changes in September
- The review period for the September rebalance ends on 31 July, the changes will be announced towards end August and implemented at the close of trading on 7 September.
- There are potential changes to some of the indices and then there are close changes that will result in big flows if they eventuate.
- The March rebalance saw some funky moves on the stocks that had big flows and we could see more of that at the September rebalance.
KRX Plans to List Single-Stock Futures of All KS200 & KQ150 Constituents
- According to Chosun, KRX plans to list the single-stock futures of all constituents of KOSPI 200 and KOSDAQ 150 within 2-3 years.
- This information comes from a KRX official, who directly confirmed it. As Chosun is the most well-established news outlet in Korea, the credibility of this article is quite high.
- We should consider screening those with a high proportion of short-selling positions and devising a positioning strategy in conjunction with the new listing event of single stock futures in July.
SET50 Index Rebalance Preview: Two Changes – One High Probability; One Has Possibilities
- Two thirds of the way through the review period, we forecast two changes for the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) at the June rebalance.
- Thai Life Insurance (TLI TB) and WHA Corp Pcl (WHA TB) could replace Jaymart PCL (JMART TB) and Ngern Tid Lor (TIDLOR TB).
- JMT Network Services (JMT TB) is a very close delete on market cap, while Intouch Holdings (INTUCH TB) is a close delete on liquidity. Multiple possibilities here.
Toshiba (6502) – Thinking About the Arb
- Toshiba is trading at a 12-13% annualised return on the arb when using the expected Tender Offer Start Date proposed in the Takeover Announcement on 23 March 2023.
- On Day 1-2 post-announcement, Toshiba traded at an 11-13% annualised spread. Since the announcement, a 12-name Peer Basket is up 11+% meaning Toshiba back end risk has shrunk.
- Forward consensus EPS ratios have fallen, in part due to the shift forward one fiscal year by comps. We’ll see where those lie in a week when earnings come.
Penguin International (PBS SP): Dymon Asia & Co Return with an S$0.82 Unconditional Offer
- Penguin International (PBS SP) has disclosed a voluntary unconditional offer from Dymon Asia, Executive Chairman and Managing Director at S$0.82 per share, a 15.5% premium to the undisturbed price.
- The offer price is attractive, represents an 8-year share price high, and is shy of the 10-year high of S$0.825. It is also 26.2% higher than the 2021 offer.
- The offeror aims to privatise Penguin. Hitting the 90% compulsory acquisition threshold implies a minority acceptance rate of around 44%, which is eminently achievable due to an attractive offer.
Ventia (VNT AU) – Placement Could Lead to ASX200 Inclusion in June
- Ventia (VNT AU) completed an A$300m placement overnight with Apollo and CIMIC Group Ltd (CIM AU) selling around 14% of the shares outstanding at a small discount to the close.
- The placement will significantly increase Ventia (VNT AU)‘s float and make the stock a high probability inclusion to the S&P/ASX 200 (AS51 INDEX) at the June rebalance.
- We now expect two changes to the S&P/ASX 200 (AS51 INDEX) in June and the impact on the stocks is over 5.5 days of ADV to trade.
Ecopro – Is This the Start of the End?
- A SELL note from a broker on Ecopro BM Co Ltd (247540 KS) was a key reason for the 7% and 8+% fall for Ecopro Co Ltd (086520 KS) .
- Is this finally start of the end of the rally for the poster boy for Korean EV
- When will earnings matter and what are the catalysts that could start the downfall?
Nexus Select Trust IPO: Valuation Insights
- Nexus Select Trust (NST IN), a consumption centre REIT, is seeking to raise up to Rs32 billion (US$392 million). The offer opens from 9-11 May.
- We previously discussed the IPO in Nexus Select Trust IPO: The Investment Case. NST is sponsored by Blackstone Group (BX US).
- Our valuation analysis suggests that the IPO price range is attractive. Therefore, we would participate in this IPO.
Oishi Group: Shareholders Back ThaiBev’s Offer
- Back on the 10th March, Thai Beverage (THBEV SP) launched a Delisting Offer for 79.66%-held Oishi Group (OISHI TB), at THB 59/share, a 26.9% premium to last close.
- This two-step Offer required a shareholder vote followed by a tendering process. Yesterday (the 3rd May), Oishi shareholders approved the Delisting Offer.
- The tendering period may kick off around this time next month, with an expected payment late August.
Chairman Kim Ik-Rae of Daou Kiwoom Group Resigns & Says Sorry – But Is This Enough?
- After the market close today, Kim Ik-Rae (Chairman of the Daou Kiwoom Group) announced his resignation of the Chairman position.
- Chairman Kim mentioned he has not done anything legally wrong. He will donate the entire amount (60.5 billion won) which was gained from selling 1.4 million shares of Daou Data.
- We believe that Kiwoom Securities’ share price could fall additional 10-30% in the next several weeks/months. This could be offset by a large share buyback & cancellation by the company.
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