Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

TKP Corporation provides convention and event management services. The Company offers hotel banquet arrangement, business conference management, restaurant operation, and other services. TKP also operates equipment rental, travel arrangement, and other businesses.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tkp-corp" target="_blank" data-smartkarma-citation="entities:28305:1" rel="noopener"> TKP Corporation (3479 JP)</a> is a fascinating little company. It rents space. From people. To people. Then adds on services. Meeting, recruiting, training, seminar, banquet, party, etc rooms.</li>
<li>Last year they bought control of two small businesses to add features. Revenues are up. The new FY suggests revenue growth, OP growth, and now a buyback.</li>
<li>The buyback is the interesting bit. They did one last FY with interesting parameters, and Quiddity has a new tool we are trying out, so we showcase an example here.</li>
</ul>



 TKP Corporation (3479 JP) is a fascinating little company. It rents space. From people. To people. Then adds on services. Meeting, recruiting, training, seminar, banquet, party, etc rooms.
Last year they bought control of two small businesses to add features. Revenues are up. The new FY suggests revenue growth, OP growth, and now a buyback.
The buyback is the interesting bit. They did one last FY with interesting parameters, and Quiddity has a new tool we are trying out, so we showcase an example here.


TKP Corp (3479) - A Second Big Buyback In Short Order

TOYOTA INDUSTRIES CORPORATION, a member of the Toyota Motor Group, assembles motor vehicles and manufactures automotive parts such as engines and air conditioner compressors.  The Company also produces industrial equipment and textile machinery as well as electronic devices such as computer modems and power inverters.

<ul>
<li>On Friday after the close, media reports surfaced that <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota Motor (7203 JP)</a> Group chairman and founding family member had put forth a take-private proposal to <a href="https://www.smartkarma.com/entities/toyota-industries-corp" target="_blank" data-smartkarma-citation="entities:4500:1" rel="noopener">Toyota Industries (6201 JP)</a>. </li>
<li>The number quoted was ¥6trln market cap (most) or EV (<a href="https://www.ft.com/content/f4a8eeda-2e2e-4947-aac7-d5d71f336432" target="_blank" rel="noopener">FT</a>), financed by personal funds, 3 megabanks, and reportedly some group companies. </li>
<li>¥6trln market cap would be +50%. ¥6trln EV +16%. Simultaneously shocking but somehow not surprising. Opportunistic, and surprisingly elegant as a family/group/cultural solution. More below.</li>
</ul>


On Friday after the close, media reports surfaced that Toyota Motor (7203 JP) Group chairman and founding family member had put forth a take-private proposal to Toyota Industries (6201 JP). 
The number quoted was ¥6trln market cap (most) or EV (FT), financed by personal funds, 3 megabanks, and reportedly some group companies. 
¥6trln market cap would be +50%. ¥6trln EV +16%. Simultaneously shocking but somehow not surprising. Opportunistic, and surprisingly elegant as a family/group/cultural solution. More below.


Toyota Industries (6201) - SURPRISE! It's a TOYODA Takeover Proposal (Good Governance May Not Win)

Guangzhou Automobile Group / Event-Driven

Guangzhou Automobile Group Company, Ltd. manufactures, sells, and services automobiles. The Company is also involved in automobile parts and components, and auto finance and related services for both overseas and domestic markets.

<ul>
<li>AH Premia fall sharply. Spread curve torsion is mild but present, with narrow AH Premia widening, and wide premia narrowing.</li>
<li>For a month I thought warning signs were flashing and spreads could widen. That has taken a pause. I am not comfortable it will remain paused or Hs will outperform.</li>
<li>The Quiddity Portfolio is pretty hunkered down and nearly flat H/A risk. But benefits from wider spreads coming in, narrow spreads widening, and liquidity dropping. Alpha good again this week.</li>
</ul>


AH Premia fall sharply. Spread curve torsion is mild but present, with narrow AH Premia widening, and wide premia narrowing.
For a month I thought warning signs were flashing and spreads could widen. That has taken a pause. I am not comfortable it will remain paused or Hs will outperform.
The Quiddity Portfolio is pretty hunkered down and nearly flat H/A risk. But benefits from wider spreads coming in, narrow spreads widening, and liquidity dropping. Alpha good again this week.


A/H Premium Tracker (To 25 Apr 2025):  AH Premia Fall Sharply; "Feels" Risk-On But Noisy Spreads

Tencent Holdings Limited operates as an investment holding company. The Company, through its subsidiaries, provides Internet and mobile value-added services (VAS), online advertising, and e-commerce transactions. Tencent Holdings offers services to users worldwide.

<ul>
<li>Q1 saw record quarterly inflows by SOUTHBOUND investors at HK$435bn, beating the previous record of Q1 2021 by more than HK$100bn. The first three weeks in April were HK$168bn.</li>
<li>The fourth week (this past week) saw net outflows on low volume as SOUTHBOUND investors sold SOEs quite heavily. </li>
<li>9 of the top 10 Net Sells as % of Volume this past week had China, Beijing, or Shanghai as the first word in their name.</li>
</ul>


Q1 saw record quarterly inflows by SOUTHBOUND investors at HK$435bn, beating the previous record of Q1 2021 by more than HK$100bn. The first three weeks in April were HK$168bn.
The fourth week (this past week) saw net outflows on low volume as SOUTHBOUND investors sold SOEs quite heavily. 
9 of the top 10 Net Sells as % of Volume this past week had China, Beijing, or Shanghai as the first word in their name.


HK Connect SOUTHBOUND Flows (To 25 Apr 2025); First Net Sell in Ages, Led by Heavy SOE Selling

Shin-Etsu Chemical Co., Ltd. produces and distributes synthetic resins and other chemical products such as fertilizers. The Company also manufactures electronic materials such as semiconductor silicon, synthetic, and rare earth quartz. Shin-Etsu Chemical operates in Japan and overseas.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/shin-etsu-chemical-co-ltd" target="_blank" data-smartkarma-citation="entities:4481:1" rel="noopener">Shin Etsu Chemical (4063 JP)</a> reported FY earnings to beat January guidance for all four major measures, just slightly. They only guide 1 quarter out, and Q1 is up year-on-year... </li>
<li>...in revenues, but down in OP and NP. Note: OP and NP guidance is nearly identical to what they guided for Q1 last year on ¥585bn revenues (vs ¥610bn now)</li>
<li>The BIG news here is a Very Large Buyback. The company has long has huge piles of cash. This buyback (~90% of annual profit) starts to make use of it.</li>
</ul>



Shin Etsu Chemical (4063 JP) reported FY earnings to beat January guidance for all four major measures, just slightly. They only guide 1 quarter out, and Q1 is up year-on-year... 
...in revenues, but down in OP and NP. Note: OP and NP guidance is nearly identical to what they guided for Q1 last year on ¥585bn revenues (vs ¥610bn now)
The BIG news here is a Very Large Buyback. The company has long has huge piles of cash. This buyback (~90% of annual profit) starts to make use of it.


Shin-Etsu Chemical (4063) - OK Earnings, OK Forecast, But Ground-Breaking Buyback

HK Type 4 license through Ballingal Investment Advisors Ltd. ("BIA" or "BIAL")

BACKGROUND
I have 20+yrs experience in Asia doing alternative strategies (i.e. non-delta1 non long-only) in fixed income, equity derivatives, and activist/catalyst/event-driven and long-short equity strategies with most of that time spent managing money. 

4 years in fixed income macro, 8 years running internal hedge fund and 4yrs investment banking at Citi in Japan, 3 years running an Asia multi-strat portfolio at a hedge fund, 4+yrs as an independent special situations analyst.

Travis Lundy
Pan-Asia Catalysts/Events
• Quiddity Advisors

TKP Corp (3479) - A Second Big Buyback In Short Order

TKP's buyback is short and very sharp. It is a LOT of stock in a short while. But we still have 3/4 of the time frame left and the stock hit a new...

Travis Lundy

Toyota Industries (6201) - SURPRISE! It's a TOYODA Takeover Proposal (Good Governance May Not Win)

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Travis Lundy

A/H Premium Tracker (To 25 Apr 2025): AH Premia Fall Sharply; "Feels" Risk-On But Noisy Spreads

AH Premia fell this week as HK stocks outperformed A-shares. It isn't clear why but the risk-on market rebounds helped. Still too noisy to take AH...

Travis Lundy

HK Connect SOUTHBOUND Flows (To 25 Apr 2025); First Net Sell in Ages, Led by Heavy SOE Selling

SOUTHBOUND activity low again this 4-day week. Trade tantrums not helping, but markets up despite SOUTHBOUND net selling for the first time in a...

Travis Lundy

Shin-Etsu Chemical (4063) - OK Earnings, OK Forecast, But Ground-Breaking Buyback

ShinEtsu Chemical is plugging along. Earnings were OK, Guidance is OK not beautiful (is anyone's now?) but they announced a Very Big Buyback. 5x...

Travis Lundy