Quality-first, Business-perspective Strategy, Urbem (HK) Limited

Steven Chen

Quality-first, Business-perspective Strategy

Equity Bottom-Up

<ul>
<li>Kakaku.com Inc. can be a rare species among listed companies in Japan;</li>
<li>We had multiple email exchanges and meetings with the management team for a deep-dive view covering corporate cultural, management style, capital allocation, business model, and competitive strength.</li>
<li>We would wait for a 20%-30% pullback in the share price before looking to add to our position but would certainly remain reluctant to sell any share that we own.</li>
</ul>


Kakaku.com Inc. can be a rare species among listed companies in Japan;
We had multiple email exchanges and meetings with the management team for a deep-dive view covering corporate cultural, management style, capital allocation, business model, and competitive strength.
We would wait for a 20%-30% pullback in the share price before looking to add to our position but would certainly remain reluctant to sell any share that we own.


Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/recruit-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:15070:1" rel="noopener">Recruit Holdings (6098 JP)</a> reported 2QFY03/2023 earnings today. Revenue increased 25.3% YoY to JPY878.4bn (vs consensus JPY842.7bn) while EBIT decreased 8.2% YoY to JPY108.5bn (vs consensus JPY116.1bn).</li>
<li>HR Tech's top line growth further slowed down to 40.2% YoY while adjusted EBITDA margin of the segment declined to 30.4% from 40.6% in the same period a year ago.</li>
<li>The company’s 2QFY03/2023 earnings were better than we expected, however, it shows that the earnings growth is slowing down with weakening of labour markets globally.</li>
</ul>



Recruit Holdings (6098 JP) reported 2QFY03/2023 earnings today. Revenue increased 25.3% YoY to JPY878.4bn (vs consensus JPY842.7bn) while EBIT decreased 8.2% YoY to JPY108.5bn (vs consensus JPY116.1bn).
HR Tech's top line growth further slowed down to 40.2% YoY while adjusted EBITDA margin of the segment declined to 30.4% from 40.6% in the same period a year ago.
The company’s 2QFY03/2023 earnings were better than we expected, however, it shows that the earnings growth is slowing down with weakening of labour markets globally.


Recruit 2Q: Outlook for HR Tech Business Becomes Challenging

Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>Good Morning Japan: A detailed look at the overnight news and market moves that will impact the trading day in Japan</li>
<li>US rally overnight on mixed employment and hopes of easing of China Covid-19 restrictions. China officials pour cold water these hopes - look for reversal  </li>
<li>Daikin Nikkei Preview - looks weak; Defense stocks likely gets support; SMBC takes that axe to SMBC Nikko CEO  - harsh. </li>
</ul>


Good Morning Japan: A detailed look at the overnight news and market moves that will impact the trading day in Japan
US rally overnight on mixed employment and hopes of easing of China Covid-19 restrictions. China officials pour cold water these hopes - look for reversal  
Daikin Nikkei Preview - looks weak; Defense stocks likely gets support; SMBC takes that axe to SMBC Nikko CEO  - harsh. 


<ul>
<li>
<a href="https://www.smartkarma.com/entities/recruit-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:15070:1" rel="noopener">Recruit Holdings (6098 JP)</a> announced a buyback yesterday for a maximum of 42m (2.55% of total shares outstanding) shares for an aggregate of JPY150bn from the market.</li>
<li>Recruit’s shares closed at JPY4,257 per share at the end of yesterday’s trading, and shares have moved up almost 5% during today’s trade following the buyback announcement.</li>
<li>This is Recruit’s second buyback in 2022 where some of its shareholders reduced their stakes during the previous buyback (tender offer agreements) in January this year.</li>
</ul>



Recruit Holdings (6098 JP) announced a buyback yesterday for a maximum of 42m (2.55% of total shares outstanding) shares for an aggregate of JPY150bn from the market.
Recruit’s shares closed at JPY4,257 per share at the end of yesterday’s trading, and shares have moved up almost 5% during today’s trade following the buyback announcement.
This is Recruit’s second buyback in 2022 where some of its shareholders reduced their stakes during the previous buyback (tender offer agreements) in January this year.


Recruit Buyback – A Temporary Support to Falling Share Price

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>In January 2022, <a href="https://www.smartkarma.com/entities/recruit-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:15070:1" rel="noopener">Recruit Holdings (6098 JP)</a> launched a Tender Offer buyback to buy back shares from NTT Data, Hakuhodo, and TBS. </li>
<li>Today, Recruit announced another buyback of up to 42mm shares (2.57% of shares out) spending up to ¥150bn, to go from now until 14 March 2023 (5mos).</li>
<li>This time the buyback should have better traction and market impact, but it is not overwhelming, and the impact will likely lessen at higher share prices.</li>
</ul>


In January 2022, Recruit Holdings (6098 JP) launched a Tender Offer buyback to buy back shares from NTT Data, Hakuhodo, and TBS. 
Today, Recruit announced another buyback of up to 42mm shares (2.57% of shares out) spending up to ¥150bn, to go from now until 14 March 2023 (5mos).
This time the buyback should have better traction and market impact, but it is not overwhelming, and the impact will likely lessen at higher share prices.


Recruit (6098) Launches ANOTHER Big Buyback

Japan

Recruit Holdings Co. Ltd. operates information providing services in human resource, housing, bridal, travel, restaurants, beauty, automobiles, and education and more. The company also operate staffing services and advertising business.

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Recruit Holdings (6098 JP)

Kakaku.com Inc.: A Deep-Dive View

Kakaku.com Inc. has impressed us as a rare species compared to many other Japanese companies and is probably the most investable publicly-traded...

Steven Chen

Recruit 2Q: Outlook for HR Tech Business Becomes Challenging

Recruit, our high conviction short is down 31% YTD. Outlook for HR Tech segment remains bleak though staffing and Matching & Solutions businesses...

Shifara Samsudeen, ACMA, CGMA

Good Morning Japan (November 7, 2022)

The way to start your Japan trading day. "Good Morning Japan" is a detailed look at the overnight news and market moves that will impact the...

Mark Chadwick

Recruit (6098) Launches ANOTHER Big Buyback

Recruit has announced another large buyback - the second one this year announced at ¥150bn. This one is from the market, meaning some price impact...

Travis Lundy

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Kakaku.com Inc.: A Deep-Dive View

Kakaku.com Inc. has impressed us as a rare species compared to many other Japanese companies and is probably the most investable publicly-traded...

Steven Chen

Recruit 2Q: Outlook for HR Tech Business Becomes Challenging

Recruit, our high conviction short is down 31% YTD. Outlook for HR Tech segment remains bleak though staffing and Matching & Solutions businesses...

Shifara Samsudeen, ACMA, CGMA

Good Morning Japan (November 7, 2022)

The way to start your Japan trading day. "Good Morning Japan" is a detailed look at the overnight news and market moves that will impact the...

Mark Chadwick

Recruit Buyback – A Temporary Support to Falling Share Price

Recruit announced a buyback of 42m shares from the open market yesterday. We think supporting its falling share price in the short-term is one of...

Shifara Samsudeen, ACMA, CGMA

Recruit (6098) Launches ANOTHER Big Buyback

Recruit has announced another large buyback - the second one this year announced at ¥150bn. This one is from the market, meaning some price impact...

Travis Lundy