In today’s briefing:
- MSCI August 2022 Index Rebalance Preview: The Last QIR!
- S&P/ASX Index Rebalance Preview: Busy Rebalance With Lots of Changes Expected
- Index Rebalance & ETF Flow Recap: STAR50, NIFTY50/100, KRX, Tianqi Lithium, Kotak Bank, Emperador
- Large Potential S-REIT Flows in the Next Two Weeks
- Alibaba (9988 HK): Dual Primary Listing Implications
- IDX30/LQ45 Index Rebalance: Big Inflows on ARTO, BBRI, BBCA; Outflows on GOTO, TLKM, BMRI
- Genex: Atlassian’s Farquhar Makes An Offer
- Thai Life Insurance (TLI): Borderline SET50 Fast Entry
- Gotion High Tech GDR Listing – Recent GDRs Have Seen Narrowing Discounts
- GEM Co., Ltd. GDR Listing – Better Discount than Last Two and Ming Yang Has Held Up
MSCI August 2022 Index Rebalance Preview: The Last QIR!
- We have completed days 1-5 in the review period for the MSCI August QIR. This is the last review that will use the current QIR methodology.
- Most changes are expected in China with the largest inflows on Gcl Poly Energy Holdings Limited (3800 HK), Tianqi Lithium (002466 CH) and Qinghai Salt Lake Industry (000792 CH).
- There are a few stocks that will have same way flows from the FTSE All-World and All-Cap trackers at the September SAIR.
S&P/ASX Index Rebalance Preview: Busy Rebalance With Lots of Changes Expected
- At the September rebalance, we expect changes to the S&P/ASX 100 Index, S&P/ASX 200 (AS51 INDEX) and S&P/ASX 300 Index. Announcement is on 2 September with implementation on 16 September.
- Potential adds/deletes with large flow and impact include Shopping Cntrs Austrls (SCP AU), Sayona Mining (SYA AU), Charter Hall Social Infrastructure REIT (CQE AU) and Capricorn Metals (CMM AU).
- Shorts have increased significantly on a few stocks over the last few weeks, indicating that there could be some pre-positioning on these stocks.
Index Rebalance & ETF Flow Recap: STAR50, NIFTY50/100, KRX, Tianqi Lithium, Kotak Bank, Emperador
- We have gone through days 1-5 of the review period for the MSCI September rebalance. There are multiple review cutoffs in the coming week.
- The announcement of the changes to the LQ45/IDX30/IDX80 indices should be made early in the coming week and implemented at the close on 29 July.
- China had the largest ETF inflows over the last week, while there were outflows from Korea focused ETFs.
Large Potential S-REIT Flows in the Next Two Weeks
- Given recent corporate events in S-REIT land, there could be some considerable money to be allocated to the sector near-term
- These flows come at a time when prices are down off highs and liquidity is low.
- There could be some price impact on certain types of S-REITs near-term.
Alibaba (9988 HK): Dual Primary Listing Implications
- Alibaba Group (9988 HK) currently has a Secondary Listing in Hong Kong and is looking to become dual primary listed in Hong Kong and the U.S.
- The main change will be inclusion in the Southbound Stock Connect program where mainland investors will be able to buy the stock.
- Alibaba Group (9988 HK) is capped at 8% in the HSCEI INDEX and is close to 8% of the HSI INDEX, there will be negligible impact on the dividend futures.
IDX30/LQ45 Index Rebalance: Big Inflows on ARTO, BBRI, BBCA; Outflows on GOTO, TLKM, BMRI
- There are 3 changes each for the IDX30 Index and LQ45 Index and 11 changes for the IDX80 Index at the upcoming rebalance to be implemented on 29 July.
- There is passive inflow on Bank Jago Tbk PT (ARTO) due to index inclusion, and on Bank Rakyat Indonesia (BBRI) and Bank Central Asia (BBCA) due to capping changes.
- With only 4 days to implementation, there will be relatively big moves on stocks that have large flow/impact from passive fund trading.
Genex: Atlassian’s Farquhar Makes An Offer
- Renewable energy play Genex Power Ltd (GNX AU) has announced a non-binding indicative proposal from Atlassian’s Scott Farquhar and Stonepeak, by way of a Scheme, at A$0.23/share.
- That’s around a 64% premium. Farquhar holds a 19.9% stake.
- Farquhar, along with Atlassian co-founder Mike Cannon-Brookes, backed Genex capital raising in March last year.
Thai Life Insurance (TLI): Borderline SET50 Fast Entry
- Thai Life Insurance (TLI TB) raised over US$1bn in its IPO and has started trading on the SET today.
- At the last trade price of THB 16/share, Thai Life Insurance (TLI TB) is a borderline Fast Entry add to the Stock Exchange of Thailand SET 50 Index (SET50 INDEX).
- If Thai Life Insurance (TLI TB) is added to the index, Bangkok Life Assurance (BLA TB) is the most likely deletion.
Gotion High Tech GDR Listing – Recent GDRs Have Seen Narrowing Discounts
- Gotion High-Tech Co Ltd (002074 CH) (GHT) is looking to raise US$1bn from its Swiss GDR listing. Bookrunners on the deal are CICC and Haitong International.
- The shares offered in GHT’s GDR offering ranges between 16.65m – 33.29m GDRs (83.24m – 166.47m A-shares), ranging the deal size between US$499m-US$1bn.
- At the top end, in terms of number of GDRs offered, the deal would represent 4.7 days of ADV on the A-share market and 9.6% of current mcap.
GEM Co., Ltd. GDR Listing – Better Discount than Last Two and Ming Yang Has Held Up
- Gem Co Ltd A (002340 CH) is looking to raise around US$245m in its Swiss GDR listing.
- Proceeds will be used mainly for overseas expansion, such as the development of the Indonesian Nickel Resource Base and development of its production base and recycling center in Europe.
- In terms of discount, relative to the most recent two deals, Keda Industrial and Ningbo Shanshan, GEM’s GDRs are offered at a more enticing 11.7-14.2% discount to its A-shares,
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