In today’s briefing:
- Big ¥500bn Honda (7267) Offering Is Small
- Robosense IPO Lock-Up Expiry – US$2.8bn Lockup Expiry for 99% of the Stock, CCASS Movement
- A Practical Guide to Create A Workable Electronic File for KOSPI 200 Rebalancing Simulation
- Hanwha Corp Tender Offer Details & Arbitrage Trading Assessment
- Aisin (7259 JP): The Current Playbook
- Aisin Corp Placement – Follow Up – Could Fall into a Similar Fate as past Large JP Secondary Deals
- JAPAN ACTIVISM: Murakami Target Mitsui Matsushima Cleans Up
- Impact of Kim Byung-Hwan’s Appointment as Korea FSC Chairman on Value-Up Policy
- SHEIN: Teaming up with Reliance Retail to Re-Enter India. A Win-Win Move
- HK CEO & Director Dealings (5th Jul 2024): J&T Global Express, Flat Glass, Lifetech Scientific, PCCW
Big ¥500bn Honda (7267) Offering Is Small
- Just pre-close on 2 July, Reuters carried an article suggesting a ¥500bn secondary offering in Honda Motor (7267 JP) as insurers sold. The stock fell 4% in minutes.
- Honda semi-confirmed but it took two days to get to the details, now out. The stock climbed in the meantime.
- At launch, this deal is two-thirds covered by buyback + passive demand but the supply is heavily-weighted to retail. Cheaper than it looks, lots of moving parts. Read the details!
Robosense IPO Lock-Up Expiry – US$2.8bn Lockup Expiry for 99% of the Stock, CCASS Movement
- Robosense Technology (2498 HK) raised around US$126m in its Hong Kong IPO in Jan 2024. The lockup on its shareholders will expire soon.
- The company provides LiDAR and perception solutions to its customers. As of March 2024, it had design wins for mass production of LiDAR products with 22 automotive OEMs and suppliers.
- In this note, we talk about the upcoming lock-up expiry and possible deal dynamics.
A Practical Guide to Create A Workable Electronic File for KOSPI 200 Rebalancing Simulation
- Predicting KOSPI 200 rebalancing is straightforward, focusing on quantitative screening rather than qualitative factors, unlike other indices.
- Accurate simulation of KOSPI 200 requires daily data on shares, volume, and prices for six months, typically sourced from KOSCOM due to limitations in free data access.
- I plan to share a practical KOSPI 200 simulation file with Smartkarma readers, leveraging freely available data from Google Finance.
Hanwha Corp Tender Offer Details & Arbitrage Trading Assessment
- Hanwha Energy, wholly owned by the Hanwha Group’s owning family, announced a tender offer for an 8% stake in Hanwha Corp at ₩30,000. The tender period is until July 24.
- Hanwha Energy will buy all shares if tendered less than planned, otherwise pro-rata. Payment in cash eliminates cancellation risk but poses allocation risk.
- Approximately 10-15% of shares are likely to be the potential ceiling for tendering, minimizing allocation risk for the 8% target. A widening spread of 2-3% could offer arbitrage opportunities.
Aisin (7259 JP): The Current Playbook
- Since the US$1.1 billion secondary placement announcement, Aisin (7259 JP)’s shares are up 2.5% from the undisturbed price of JPY5,243 per share (27 June).
- Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Aisin’s shares have deviated from the pattern of previous large placements.
- The offering will likely be priced on 8 July. Investors who have participated in previous large Japanese placements tend to secure positive returns.
Aisin Corp Placement – Follow Up – Could Fall into a Similar Fate as past Large JP Secondary Deals
- Denso Corp (6902 JP), Toyota Motor (7203 JP) and Toyota Industries (6201 JP) are looking to raise US$1.1bn from selling some of their stakes in Aisin (7259 JP).
- We have covered the background of the deal in our earlier note, Aisin Corp Placement – US$1.1bn Selldown by Toyota and DENSO.
- In this note, we talk about the updates since and look at the performance of some of the past large Japan deals.
JAPAN ACTIVISM: Murakami Target Mitsui Matsushima Cleans Up
- On 20 May, I wrote that Japanese activist MURAKAMI Yoshiaki and relations/affiliates had gone from 5% to 20% of Mitsui Matsushima (1518 JP) in 5 trading days.
- I wondered if it was real, or a pump & dump, but they went to near 30% in following days. THEN they drifted off as Murakami-Fille sold while Murakami-Père bought.
- The reasoning was not clear, but the story had real potential. Still does. Today, shareholders got more good news.
Impact of Kim Byung-Hwan’s Appointment as Korea FSC Chairman on Value-Up Policy
- Kim Byung-hwan addressed criticism of weak incentives in tax support for the value-up policy, emphasizing boosting dividends. His background suggests effective advocacy for tax reforms in his new role.
- He prioritized abolishing the FIIT in the National Assembly, citing its hindrance to capital market liquidity and investment promotion, indicating a robust approach to the value-up policy.
- Kim’s appointment as FSC Chairman signals the government’s commitment to advancing the value-up policy. He emphasizes boosting dividends and aligning tax policies accordingly, shaping trading strategies toward dividend-expanding companies.
SHEIN: Teaming up with Reliance Retail to Re-Enter India. A Win-Win Move
- SHEIN’s fast-fashion apparel is set to hit India through Reliance Retail’s platforms, marking a major comeback after the 2020 ban.
- This partnership could be a win-win, tapping into India’s booming fashion demand and offering Shein access to the world’s largest youth market, ahead of its proposed IPO.
- With Shein’s affordable styles and Reliance’s extensive network, this alliance targets the youth market, challenging brands like Tata Group’s Trent Ltd (TRENT IN) owned Zudio.
HK CEO & Director Dealings (5th Jul 2024): J&T Global Express, Flat Glass, Lifetech Scientific, PCCW
- The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
- Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.
- The key stocks mentioned in this regular insight include: J&T Global Express (1519 HK), Flat Glass (6865 HK), Lifetech Scientific (1302 HK), and PCCW Ltd (8 HK).
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