In today’s briefing:
- TIP Customized Taiwan Select High Dividend Index Rebalance: 13 Changes & US$5.2bn Round-Trip Trade
- STAR50/STAR100 Index Rebalance: Index Committee Flip-Flops on Profitability
- CSI300/CSI500 Index Rebalance: Big Flows and US$5bn Round-Trip Trade
- CSI All Share Semiconductor Index Rebalance: Lots of Changes in June
- CSI All Share IB & Brokerage Index Rebalance: Couple of Large Flow & Impact Names
- ChiNext/ChiNext 50 Index Rebalance: US$1bn Round-Trip Trade
- Yankuang Energy Placement – Doesn’t Appear Well Flagged Although Deal Size Is Large
- Webtoon Entertainment IPO Preview
- Nagatanien Holdings (2899 JP): Marunouchi Capital-Sponsored MBO at JPY3,100
- CSI Esoteric Index Rebals Jun 24: All Share Brokerage, China Internet, Medical, Defense, & Livestock
TIP Customized Taiwan Select High Dividend Index Rebalance: 13 Changes & US$5.2bn Round-Trip Trade
- There are 13 changes for the TIP Customized Taiwan Select High Dividend Index in June. The TIP Taiwan Select High Dividend ETF (00919 TW) has an AUM of US$6.4bn.
- One-Way turnover is estimated at 41% and that will result in a round-trip trade of TWD 168.8bn (US$5.2bn). There are 16 stocks that could have over 4x ADV to trade.
- The rebalance will be implemented over 8 trading days and the ETF has started trading the stocks last week.
STAR50/STAR100 Index Rebalance: Index Committee Flip-Flops on Profitability
- There are 3 changes for the SSE STAR50 (STAR50 INDEX) and 9 changes for the STAR100 Index. Implementation will take place at the close on 14 June.
- United Nova Technology (688469 CH) and Biwin Storage Technology (688525 CH) were not added at the March rebalance since they were consistently loss-making. But they have been added this time.
- United Nova Technology (688469 CH) had been trading poorly and then the stock dropped further after non-inclusion in March. That could change now with inclusion confirmed.
CSI300/CSI500 Index Rebalance: Big Flows and US$5bn Round-Trip Trade
- There are 12 changes for the CSI 300 Index (SHSZ300 INDEX) and 50 changes for the CSI Smallcap 500 Index (SH000905 INDEX) in June. Most changes were expected.
- There are a lot of stocks with over 1 day of ADV to trade. The round-trip trade in June is estimated to be US$5bn.
- The adds have outperformed the deletes for both indices but the return profile of a long adds/ short deletes trade for the CSI500 Index is a lot smoother.
CSI All Share Semiconductor Index Rebalance: Lots of Changes in June
- The changes to the CSI All Share Semiconductors & Semiconductor Equipment Index were announced after market close on 31 May and will be implemented at the close on 14 June.
- There are 17 adds and 5 deletes for the index.
- The adds and deletes have underperformed the index over the last 6 months but the adds have outperformed the deletes over the last 3 months.
CSI All Share IB & Brokerage Index Rebalance: Couple of Large Flow & Impact Names
- The changes to the CSI All Share Investment Banking & Brokerage Index were announced after market close on 31 May and will be implemented at the close on 14 June.
- Guosen Securities (002736 CH) will be added to the index while Northeast Securities (000686 CH) will be deleted from the index.
- There is a lot of flow and impact for both stocks and the stocks could outperform/underperform their peers over the next couple of weeks.
ChiNext/ChiNext 50 Index Rebalance: US$1bn Round-Trip Trade
- There are 7 changes for the ChiNext Index (SZ399006 INDEX) and 5 changes for the ChiNext 50 Index at the June rebalance.
- We correctly forecast 5/7 and 7/7 for the Chinext Index adds/deletes and were 3/5 and 5/5 for the Chinext50 Index adds/deletes.
- Based on the estimated passive tracking AUM, the one-way trade across both indices is estimated to be CNY 3.69bn (US$508m).
Yankuang Energy Placement – Doesn’t Appear Well Flagged Although Deal Size Is Large
- Yankuang Energy Group (1171 HK) is looking to raise up to US$608m through a primary follow-on, via selling 270m H-shares.
- The deal is a somewhat large one to digest, at 10.6 days of three month ADV and 2.7% of current mcap.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Webtoon Entertainment IPO Preview
- Webtoon Entertainment is getting ready to complete its IPO on the NASDAQ exchange in 2H 2024. Webtoon Entertainment is a subsidiary of Naver Corp (035420 KS).
- Webtoon is seeking to raise as much of US$500 million at a valuation of US$3 billion to US$4 billion.
- Webtoon Entertainment is one of the largest Korean company related IPOs in 2024.
Nagatanien Holdings (2899 JP): Marunouchi Capital-Sponsored MBO at JPY3,100
- Nagatanien Holdings (2899 JP) recommended a Marunouchi Capital-sponsored MBO at JPY3,100, a 38.4% premium to the undisturbed price.
- The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The offer period is from 4 June to 16 July.
- While not a knockout bid, the offer represents a five-year high and requires a 58% minority acceptance rate. This is a done deal with payment commencing from 23 July.
CSI Esoteric Index Rebals Jun 24: All Share Brokerage, China Internet, Medical, Defense, & Livestock
- We have already discussed our flow expectations for the mainstream indices in the CSI family such as CSI300/500, SSE50/100, and the STAR50/100 for the June 2024 index rebal event.
- In this insight, we take a look at our flow expectations for the ADDs/DELs involved in the rebalance of some of the lesser known indices in the CSI family.
- The indices covered in this insight are All Share Brokerage, China Internet, Medical Devices, National Defense, and Livestock Breeding indices.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Analytics and News
- ✓ Events & Webinars
