In today’s briefing:
- Toshiba (6502) – There Is Actual News, and There Are Datapoints Which Masquerade as News
- SZSE1000 Index Rebalance Preview: Stock Connect & MSCI/FTSE Eligibility
- Blibli IPO: The Bull Case
- Mitsubishi Estate Logistics (3481 JP): Offering Could Trigger Outperformance Vs Peers Like Last Time
- Tyro Payments In Talks With Westpac
- PT Global Digital Trade (BliBli) Pre-IPO – The Positives – Wide Offering, Strong COVID Bounce Back
- Giant Biogene Pre-IPO – Peer Comparison – Might Need to Spend a Lot More Online
- A Pair Trade Between LG Corp & LG Electronics
- China VAST (6166 HK): Expect November Scheme Meeting As Pre-Cons Satisfied
- NIFTY Indices: HDFC/HDFCB Merger Driven Market Consultation
Toshiba (6502) – There Is Actual News, and There Are Datapoints Which Masquerade as News
- A week after JIP gets preferred status and we had rumoured bid prices, we now have an article saying JIC/Bain is still in it, and a new article today.
- Today’s “new” article says JIP’s bid price is what the first leak suggested, which is below ¥6,000/share. Other articles suggest bidders are finding that securing financing is tough.
- Investors should look at process and understand the difference between this one and most others. It matters. Some news is not news, other than telling you the dance has started.
SZSE1000 Index Rebalance Preview: Stock Connect & MSCI/FTSE Eligibility
- Nearing the end of the review period for the SZSE1000 Index, we estimate around 50 changes to the index. The first-order impact on the stocks is not large.
- Stocks that are not currently in Buy/Sell Stock Connect will be added to the list. That makes them eligible for inclusion in the MSCI and FTSE indices in February/March.
- 5 of the potential adds could be added to the MSCI China Index in February and 34 of the potential adds could be added to the FTSE All-World/All-Cap in March.
Blibli IPO: The Bull Case
- Blibli (1437710D IJ), a leading Indonesian e-commerce player, has launched an IDR8.2 trillion (US$530 million) Indonesian IPO. Bookbuilding is from 17 to 24 October.
- According to Frost & Sullivan, Blibli.com was No. 1 in the fresh food category and 1P consumer electronics in the B2C omnichannel among e-commerce players in Indonesia in 2021.
- The key elements of the bull case rest on a large and growing addressable market, strong ecosystem, high order values, rising cohort spending and fast-paced growth.
Mitsubishi Estate Logistics (3481 JP): Offering Could Trigger Outperformance Vs Peers Like Last Time
- Last Friday, small-cap logistics JREIT Mitsubishi Estate Logistics (3481 JP) (“MEL“) announced a follow-on equity offering to fund part of their recently-announced property acquisition.
- The primary offer quantity is 51,000 units. In addition, there will also be an over-allotment quantity of 2,550 units. The total size of this offering could be roughly ¥23bn (~US$157mn).
- Below is a closer look at the details of this offering and the potential of this offering to trigger strong secondary market performance in the following weeks.
Tyro Payments In Talks With Westpac
- Back on the 8 September, payment provider Tyro Payments (TYR AU) rejected a proposal from a Potentia-led consortium at A$1.27/share, by way of a Scheme.
- Tyro has now announced it has received approaches from several parties, including Westpac (WBC AU). “None of these approaches are sufficiently definite … to warrant further disclosure at this time“.
- Shares are currently trading at A$1.59/share. Tyro recently raised its FY23 EBITDA guidance to A$28mn-34mn, up from A$23mn-29mn.
PT Global Digital Trade (BliBli) Pre-IPO – The Positives – Wide Offering, Strong COVID Bounce Back
- PT Global Digital Trade (1437710D IJ) (BliBli) aims to raise up to US$530m in its Indonesian IPO.
- BliBli provides e-commerce services across Indonesia to both retail consumers and institutions
- In this note, we’ll talk about the positive aspects of the deal.
Giant Biogene Pre-IPO – Peer Comparison – Might Need to Spend a Lot More Online
- Giant Biogene Holding (GBH HK) aims to raise around US$500m in its Hong Kong IPO.
- GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.
- We had looked at the company’s past performance in our previous notes. In this note, we’ll undertake a peer comparison.
A Pair Trade Between LG Corp & LG Electronics
- In this insight, we discuss a pair trade between LG Corp (003550 KS) (go long) and LG Electronics (066570 KS) (go short).
- LG Electronics is likely to have continued weakening results, due to rising interest rates on the household disposable income in major countries.
- Our base case valuation analysis of LG Corp suggests an implied price of 93,905 won per share, representing 19% upside from current levels.
China VAST (6166 HK): Expect November Scheme Meeting As Pre-Cons Satisfied
- Back on the 9 June, Urban planner China Vast Industrial Urban Development (6166 HK) received a pre-conditional Offer, by way of a Scheme, from China Jinmao Holdings (817 HK).
- The cancellation (and final) price is HK$2.40/share, a ~30% premium to the undisturbed price. Pre-Conditions include approvals from SAMR, SASAC, and NDRC.
- Those pre-cons have now been satisfied. The Scheme Doc is currently expected to be dispatched on or before the 31 October. There may be some slippage.
NIFTY Indices: HDFC/HDFCB Merger Driven Market Consultation
- There was a lot of confusion around how NSE Indices would handle the HDFC Limited (HDFC IN) / HDFC Bank (HDFCB IN) merger in its indices.
- The market consultation seeks to change the index methodology to bring it in line with other index providers. That will result in much lower turnover than the existing index methodology.
- Pidilite Industries (PIDI IN) is a high probability add to the NIFTY Index possibly in the first quarter of 2023. There will also be changes to Nifty Next 50 Index.
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