In today’s briefing:
- MVIS Global Rare Earth/Strategic Metals Index Rebalance Preview: One Add, One Delete Possible
- KRX New Deal Index Rebalance Preview: Potential Flows as Announcement Looms
- China Vanke (2202 HK): Placement & Index Flows
- SET50 Index Rebalance: SAWAD Added; Buying at the Close Today
- SBI Sumishin NetBank (7163 JP) Re-IPO Details, Fundamentals Tearsheet, Likely Index Treatment
- HKBN Ltd (1310 HK) Mulls I Square’s HGC Offer
- SBI Sumishin Net Bank Pre-IPO – Refiling Updates – Growth Picks Up
- Otsuka Holdings – Family Co Selldown for ¥56bn – Take It Vs Peers
- Adani Group: GQG Bets Big; MSCI Index Impacts
- MBK & Unison Capital Trying to Take Osstem Implant Private: “Two Yards to Endzone”
MVIS Global Rare Earth/Strategic Metals Index Rebalance Preview: One Add, One Delete Possible
- The review period for the March rebalance ended yesterday. Announcement of the changes will be made on 10 March and will be implemented at the close on 17 March.
- Mineral Resources (MIN AU) is a potential index inclusion if it is added to the index universe with lithium revenues nearing the 50% threshold.
- ioneer Ltd (INR AU) is very close to the 98% deletion threshold and could be removed from the index at the March rebalance.
KRX New Deal Index Rebalance Preview: Potential Flows as Announcement Looms
- The review period for the March rebalance ended on 31 January, changes will be announced in the next few days and implemented at the close of trading on 9 March.
- We forecast one add/delete for the Secondary Battery Index and Game Index, and a couple of adds/deletes for the BBIG Index. There will be a lot of capping changes.
- The largest inflows are expected on Posco Chemical (003670 KS) and Douzone Bizon (012510 KS); the largest outflows are expected on SK Innovation (096770 KS) and KMW (032500 KS).
China Vanke (2202 HK): Placement & Index Flows
- News reports indicate that China Vanke (H) (2202 HK) is looking to place 300m shares at a price range of HK$12.93-13.20/share to raise around US$500m.
- The 300m shares is nearly 33 days of ADV, but around 11-12% of the new shares will be bought by passive trackers early next week and provide near-term support.
- China Vanke (H) (2202 HK) trades cheaper than its peers on EV/Sales, EV/EBITDA and forward PE. Shorts have ticked higher in the last couple of weeks.
SET50 Index Rebalance: SAWAD Added; Buying at the Close Today
- Srisawad Power 1979 (SAWAD TB) has been added to the SET50 INDEX following the Total Access Communication (DTAC TB) / True Corp Pcl (TRUE TB) merger.
- Passive SET50 INDEX trackers will need to buy 9.7m shares (THB 534m; 1x ADV) of Srisawad Power 1979 (SAWAD TB) at the close of trading today.
- There could be two more changes in June with relatively new listings, Thai Life Insurance (TLI TB) and Betagro (BTG TB), being added to the SET50 INDEX.
SBI Sumishin NetBank (7163 JP) Re-IPO Details, Fundamentals Tearsheet, Likely Index Treatment
- In February 2022, SBI Holdings (8473 JP) and Sumitomo Mitsui Trust Holdings (8309 JP) announced they would IPO SBI Sumishin Net Bank (7163 JP) but that got cancelled by Ukraine.
- Yesterday, they announced they were going to try again. This time, with a reduced price and reduced aspirations. Given the way banks have performed in the last year… 👀
- That changes – completely – the picture of index demand. But it also changes the fundamental picture.
HKBN Ltd (1310 HK) Mulls I Square’s HGC Offer
- Reportedly (Bloomberg) Hong Kong broadband play HKBN Ltd (1310 HK) has received a takeover offer from I Square’s HGC Global Communications.
- HKBN’s shares were halted in the late afternoon trading session yesterday after gaining 11.6%. The reason stated for the suspension was “possible inside information“, not pursuant to the Takeovers Code.
- Last May, Bloomberg reported that KKR, PAG, and Stonepeak – amongst others – were considering bids for HKBN. The market cap at the time was US$1.6bn versus US$934mn now.
SBI Sumishin Net Bank Pre-IPO – Refiling Updates – Growth Picks Up
- SBI Sumishin Net Bank (SSNB) is now looking to raise around US$380m in its second listing attempt.
- SBI Sumishin Net Bank is a Japanese digital bank set up as a 50-50 joint venture between Sumitomo Mitsui Trust Bank, Japan’s largest trust bank, and SBI Group.
- In this note, we talk about the updates from the latest filings.
Otsuka Holdings – Family Co Selldown for ¥56bn – Take It Vs Peers
- Today after the close, one of the very large brokers in Japan (N_m_r_) has a block for sale of Otsuka Holdings (4578 JP).
- It is only 2.4% of total shares out, and as such, it looks small. But it isn’t that small. The shareholder structure is crowded with non-Real World Float holders.
- The discount offered is large compared to absolute and sector-relative volatility.
Adani Group: GQG Bets Big; MSCI Index Impacts
- Post market close yesterday it was announced that GQG Partners (GQG AU) had invested INR 154.46bn (US$1.87bn) in four Adani Group companies via block deals.
- The blocks were at a discount of 4.3% for Adani Ports & Special Economic Zone (ADSEZ IN) to 12.2% for Adani Enterprises (ADE IN).
- There will be an increase in the free float for some Adani Group companies as a result of the blocks and there are implications for the stocks in indexes.
MBK & Unison Capital Trying to Take Osstem Implant Private: “Two Yards to Endzone”
- MBK Partners and Unison Capital are trying to take Osstem Implant (048260 KS) private. Currently, it is estimated that the MBK/Unison consortium has secured 88.7% stake in Osstem Implant.
- In the case of companies listed in KOSDAQ, if you have a stake of 90% or more, the company can generally proceed with discussions on delisting with the exchange.
- There is a high probability of delisting sometime in March/April under two different scenarios. The second scenario offers the remaining minority shareholders and arb traders potential for further alpha creation.
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