Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>Japanese equities were marginally higher on the week as global markets continued to focus on problems in the banking system</li>
<li>The Fed, The Bank of England and the Swiss National Bank continued to fight the war on inflation.</li>
<li>In Japan, Recruit was the standout performer after the company announced a hefty cut to its workforce (in a bad news is good news kinda way)</li>
</ul>


Japanese equities were marginally higher on the week as global markets continued to focus on problems in the banking system
The Fed, The Bank of England and the Swiss National Bank continued to fight the war on inflation.
In Japan, Recruit was the standout performer after the company announced a hefty cut to its workforce (in a bad news is good news kinda way)


Japan Weekly | Financials Still a Concern, Recruit, Toyota Industries

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/rakuten-bank-ltd" target="_blank" data-smartkarma-citation="entities:35638:1" rel="noopener">Rakuten Bank (5838 JP)</a>, the online banking arm of <a href="https://www.smartkarma.com/entities/rakuten-group-inc" target="_blank" data-smartkarma-citation="entities:31:1" rel="noopener">Rakuten (4755 JP)</a>, aims to raise up to around US$900m in its Japan listing in April 2023.</li>
<li>RB is the largest internet bank in Japan, by number of accounts. As of Dec 22, it had 13.3m deposit accounts with a total deposit base of JPY8.8tn.</li>
<li>In our earlier notes, we have looked at the company’s past performance. In this note, we talk about the updates from its recent filings.</li>
</ul>



Rakuten Bank (5838 JP), the online banking arm of Rakuten (4755 JP), aims to raise up to around US$900m in its Japan listing in April 2023.
RB is the largest internet bank in Japan, by number of accounts. As of Dec 22, it had 13.3m deposit accounts with a total deposit base of JPY8.8tn.
In our earlier notes, we have looked at the company’s past performance. In this note, we talk about the updates from its recent filings.


Rakuten Bank IPO - Recent Filings Updates and Quick Thoughts on Valuation

<ul>
<li>OVERSEAS. Fed Chair Powell delivers expected +25bps;  Hawkish pledge on inflation + Yellen's testimony rattles markets; Safety trade reasserts; Seems like more volatility ahead for all markets. </li>
<li>JAPAN. NKY Futs -1.7% vs Cash; USDJPY strengthens to 131.4 n rush to safety; Monetary nomalization on course in Japan - solid Land price gains + continued wage hikes. </li>
<li>NUGGET. NIKON - Riding the Digital Camera Renaissance.  Camera demand has stabilizes and is recovering as consumers shift to high end models. </li>
</ul>


OVERSEAS. Fed Chair Powell delivers expected +25bps;  Hawkish pledge on inflation + Yellen's testimony rattles markets; Safety trade reasserts; Seems like more volatility ahead for all markets. 
JAPAN. NKY Futs -1.7% vs Cash; USDJPY strengthens to 131.4 n rush to safety; Monetary nomalization on course in Japan - solid Land price gains + continued wage hikes. 
NUGGET. NIKON - Riding the Digital Camera Renaissance.  Camera demand has stabilizes and is recovering as consumers shift to high end models. 


Good Morning Japan |Yellen/Powell Rattles Markets; NUGGET: NIKON - Riding the DigiCam Renaissance

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.

Equity Bottom-Up

<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>  share price is down 18% YTD and the valuation multiples have more than halved since their peak in November 2021.</li>
<li>The company’s recent 3QFY03/2022 earnings pointed towards declining profitability with mismatch in the labour markets easing off.</li>
<li>The job openings in the US have further declined in January suggesting that Recruit’s share price has more room to fall as consensus has further downgraded estimates.</li>
</ul>



Recruit Holdings (6098 JP)  share price is down 18% YTD and the valuation multiples have more than halved since their peak in November 2021.
The company’s recent 3QFY03/2022 earnings pointed towards declining profitability with mismatch in the labour markets easing off.
The job openings in the US have further declined in January suggesting that Recruit’s share price has more room to fall as consensus has further downgraded estimates.


Recruit: Share Price Continues to Fall as Labour Markets Facing Challenges

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Three years ago I wrote a <a href="https://www.smartkarma.com/insights/the-activism-at-tbs-there-s-a-history-and-there-is-new-activity-but-don-t-hold-your-breath" target="_blank" rel="noopener">piece</a> about the history of activism at <a href="https://www.smartkarma.com/entities/tokyo-broadcasting-system" target="_blank" data-smartkarma-citation="entities:12981:1" rel="noopener">Tokyo Broadcasting System (9401 JP)</a>, suggesting it was not expensive but activist gains might be hard won.</li>
<li>Yesterday, TBS announced it would sell strategic cross-holdings to raise cash for investment, as per its Medium-Term Management Plan 2023, and its full-year forecast Net Profit would rise 75%.</li>
<li>That tells you what you need to know, and it guides you to the value within. </li>
</ul>


Three years ago I wrote a piece about the history of activism at Tokyo Broadcasting System (9401 JP), suggesting it was not expensive but activist gains might be hard won.
Yesterday, TBS announced it would sell strategic cross-holdings to raise cash for investment, as per its Medium-Term Management Plan 2023, and its full-year forecast Net Profit would rise 75%.
That tells you what you need to know, and it guides you to the value within. 


TBS (9401) Selling Cross-Holdings But Don't Hold Your Breath

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)

Japan Weekly | Financials Still a Concern, Recruit, Toyota Industries

We share weekly commentaries with investors on stocks on our watchlists that have appreciated or dropped more than 10% during the week.

Mark Chadwick

Rakuten Bank IPO - Recent Filings Updates and Quick Thoughts on Valuation

Rakuten Bank (5838 JP), the online banking arm of Rakuten (4755 JP), aims to raise up to around US$900m in its Japan listing in April 2023.

Sumeet Singh

Good Morning Japan |Yellen/Powell Rattles Markets; NUGGET: NIKON - Riding the DigiCam Renaissance

Fed Chair Powell delivers expected +25bps; Hawkish pledge on inflation + Yellen's testimony rattles markets; Safety trade reasserts; Seems like...

Mark Chadwick

TBS (9401) Selling Cross-Holdings But Don't Hold Your Breath

TBS has likely just sold a few to several hundred million dollars of crossholdings. But that is a one-off to finance investments. There is still no...

Travis Lundy

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Japan Weekly | Financials Still a Concern, Recruit, Toyota Industries

We share weekly commentaries with investors on stocks on our watchlists that have appreciated or dropped more than 10% during the week.

Mark Chadwick

Rakuten Bank IPO - Recent Filings Updates and Quick Thoughts on Valuation

Rakuten Bank (5838 JP), the online banking arm of Rakuten (4755 JP), aims to raise up to around US$900m in its Japan listing in April 2023.

Sumeet Singh

Good Morning Japan |Yellen/Powell Rattles Markets; NUGGET: NIKON - Riding the DigiCam Renaissance

Fed Chair Powell delivers expected +25bps; Hawkish pledge on inflation + Yellen's testimony rattles markets; Safety trade reasserts; Seems like...

Mark Chadwick

Recruit: Share Price Continues to Fall as Labour Markets Facing Challenges

Recruit’s share price is down 18% YTD with mismatch in the labor markets easing off. Job openings in the US have further declined in January...

Shifara Samsudeen, ACMA, CGMA

TBS (9401) Selling Cross-Holdings But Don't Hold Your Breath

TBS has likely just sold a few to several hundred million dollars of crossholdings. But that is a one-off to finance investments. There is still no...

Travis Lundy