Seegene, Alteogen, and Shinpung Pharmaceutical: Will MSCI Inclusion Effects Emerge?

[Asia Economy Reporter Song Hwajeong] Foreign buying pressure is pouring in on Seegene, Alteogen, and Shinpung Pharmaceutical, which will be newly included in the Morgan Stanley Capital International (MSCI) Korea Index starting next month on the 1st, showing the effect of the new inclusion.

According to the Korea Exchange on the 31st, Seegene, Shinpung Pharmaceutical, and Alteogen ranked among the top stocks in net foreign buying last week. Foreigners purchased Seegene worth 67.6 billion KRW, Shinpung Pharmaceutical 51.6 billion KRW, and Alteogen 25.5 billion KRW last week.

Foreign investors have continuously bought Shinpung Pharmaceutical except for only two days since the 29th of last month, and Alteogen has been a net buyer on all but six trading days this month. The foreign ownership of Shinpung Pharmaceutical expanded from 2.23% at the end of last month to 3.93%, while Alteogen’s foreign ownership rose from 13.08% to 14.53%. Regarding Seegene, which had been under selling pressure since the end of July, foreign investors showed buying pressure except for one day last week.

The stock prices are also strong due to foreign buying pressure. Shinpung Pharmaceutical’s stock price, which was 69,000 KRW at the end of last month, rose to the 110,000 KRW level this month. As of 9:25 a.m. today, Shinpung Pharmaceutical recorded 118,500 KRW, up 6.76% (7,500 KRW) from the previous day. Alteogen, which had fallen to the 160,000 KRW level recently due to institutional selling, also recovered to the 190,000 KRW level. Today, Alteogen recorded 191,200 KRW, up 3.86% from the previous day. Seegene, which showed weakness in August, is also showing signs of a recent rebound. It rose more than 2% today, recovering to the 250,000 KRW level.

The influx of foreign buying is interpreted as an effect of these three stocks being newly included in the MSCI Korea Index. According to the MSCI quarterly review announced on the 13th, Seegene, Alteogen, and Shinpung Pharmaceutical were newly included in the MSCI Korea Standard Index. The newly revised index will be reflected starting from the 1st of next month based on the closing price of today’s trading session.

Lee Kyungsoo, a researcher at Hana Financial Investment, said, "The MSCI Emerging Markets (EM) passive tracking funds are estimated at about 236 billion USD, and through this quarterly review, an inflow of funds of 111 billion KRW for Shinpung Pharmaceutical, 106.4 billion KRW for Seegene, and 87 billion KRW for Alteogen is expected."

However, the possibility that foreigners may turn to selling after the change date cannot be excluded. Roh Donggil, a researcher at NH Investment & Securities, said, "The representative strategy for index changes is to buy on the review day and sell on the change day (rebalancing day). The reason for selling on the change day is that passive funds such as exchange-traded funds (ETFs) mainly flow in during the simultaneous bidding session on the change day."

This content was produced with the assistance of AI translation services.