Expert on Japan Retail and Consumer Markets, JapanConsuming

Michael Causton

Expert on Japan Retail and Consumer Markets

Real Insight on Japanese Consumer Markets

JapanConsuming

JapanConsuming is a specialist research firm producing intelligence on Japanese retail and consumer markets. Founded in 2000, JapanConsuming has become the leading provider of insights on Japanese retailers and consumer trends to retailers, brands, government agencies and investors. As well as a highly regarded monthly report on the market, JapanConsuming produces in-depth reports on retail sectors, seminars on key trends and telephone consulting to investors on trends and retailers.

JapanConsuming was founded by Michael Causton and Roy Larke. 

Thematic (Sector/Industry)

<ul>
<li>Daiso is usually known for standing back and throwing mountains of plastic into cramped stores and selling it all for ¥100 per item. </li>
<li>Daiso has moved on in the past few years and now has new formats that not only sell at higher prices but offer a level of quality that surprises customers.</li>
<li>Its latest chain, Standard Products, targets Muji and Nitori in home categories for anything smaller than a desk and is representative of the growing sophistication and reach of discount retailing.</li>
</ul>


Daiso is usually known for standing back and throwing mountains of plastic into cramped stores and selling it all for ¥100 per item. 
Daiso has moved on in the past few years and now has new formats that not only sell at higher prices but offer a level of quality that surprises customers.
Its latest chain, Standard Products, targets Muji and Nitori in home categories for anything smaller than a desk and is representative of the growing sophistication and reach of discount retailing.


Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/yamada-denki-co-ltd" target="_blank" data-smartkarma-citation="entities:641:1" rel="noopener">Yamada Denki (9831 JP)</a> reported <a href="https://www.yamada-holdings.jp/ir/kessan/2022/220506.pdf" target="_blank" rel="noopener">earnings</a> (Revs -7.6% (slight beat), OP -28.6% (slight miss), NP -2.4% (slight miss)), and slightly upbeat forecasts to Mar-2023 (Revs +4.6%, OP +12.5%, NP +2.9%) </li>
<li>They also <a href="https://www.yamada-holdings.jp/lang-en/pdf/press/220506_1e.pdf" target="_blank" rel="noopener">announced</a> an unchanged dividend at ¥18/share, and a VERY BIG BUYBACK. This is one of the largest, most aggressive, on-market buyback programs I have ever seen.</li>
<li>Previous buybacks have been duds. Yamada Denki is not playing around this time. This time it will be a buy.</li>
</ul>



Yamada Denki (9831 JP) reported earnings (Revs -7.6% (slight beat), OP -28.6% (slight miss), NP -2.4% (slight miss)), and slightly upbeat forecasts to Mar-2023 (Revs +4.6%, OP +12.5%, NP +2.9%) 
They also announced an unchanged dividend at ¥18/share, and a VERY BIG BUYBACK. This is one of the largest, most aggressive, on-market buyback programs I have ever seen.
Previous buybacks have been duds. Yamada Denki is not playing around this time. This time it will be a buy.


Yamada Denki - GINORMOUS Buyback To Dramatically Boost EPS and ROE

<ul>
<li>The latest figures show that Japanese incomes fell for the first time in five years in 2021. </li>
<li>But despite this, average monthly household expenditure recovered and then accelerated at the end of the year. Online spending grew significantly, and much of this was new growth</li>
<li>We detail below which retailers are likely to benefit from these shifts in consumption behaviour over the next few years.</li>
</ul>


The latest figures show that Japanese incomes fell for the first time in five years in 2021. 
But despite this, average monthly household expenditure recovered and then accelerated at the end of the year. Online spending grew significantly, and much of this was new growth
We detail below which retailers are likely to benefit from these shifts in consumption behaviour over the next few years.


Japanese Household Expenditure in 2021 and Beyond: Which Retailers Will Benefit?

<ul>
<li>This is an in-depth review of Japanese e-commerce in the last 18 months, a time when e-commerce expanded rapidly and by 2023, e-commerce will be Japan’s single biggest retail channel.</li>
<li>We are now riding a wave of change as retailers integrate the e-commerce channel into their businesses, increasingly approaching a true omnichannel model.</li>
<li>And this is important in Japan because, although e-commerce penetration appears low, this overlooks the importance, convenience and ease of access to physical shops and integration with online.</li>
</ul>


This is an in-depth review of Japanese e-commerce in the last 18 months, a time when e-commerce expanded rapidly and by 2023, e-commerce will be Japan’s single biggest retail channel.
We are now riding a wave of change as retailers integrate the e-commerce channel into their businesses, increasingly approaching a true omnichannel model.
And this is important in Japan because, although e-commerce penetration appears low, this overlooks the importance, convenience and ease of access to physical shops and integration with online.


Equity Analyst, LightStream Research

Oshadhi Kumarasiri

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

Pan Pacific International Holdings / Equity Bottom-Up

<ul>
<li>With momentum behind defensive/semi defensive names in the Japanese market, <a href="https://www.smartkarma.com/entities/pan-pacific-international-holdings-corporation" target="_blank" data-smartkarma-citation="entities:13475:1" rel="noopener">Pan Pacific International Holdings (7532 JP)</a>’ seems to have one of the best risk reward ratios among Japanese retail players.</li>
<li>PPI’s undervaluation is visible in valuation multiples across the board with all multiples trading near the past 10-year low level.</li>
<li>Thus, we would buy PPI with a target of 40% upside in the short term.</li>
</ul>


With momentum behind defensive/semi defensive names in the Japanese market, Pan Pacific International Holdings (7532 JP)’ seems to have one of the best risk reward ratios among Japanese retail players.
PPI’s undervaluation is visible in valuation multiples across the board with all multiples trading near the past 10-year low level.
Thus, we would buy PPI with a target of 40% upside in the short term.


Pan Pacific International Valuation: All Signs Points to a Large Upside in the Short Term

Japan

Nitori Holdings Co., Ltd., is based in Hokkaido and operates a furniture retail chain.  The Company sells living room furniture, storage furniture, dining furniture, office furniture, beds, and interior goods.  Nitori Holdings also sells original brand merchandise and imported merchandise.

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Nitori Holdings (9843 JP)

Daiso: Going After Muji and Nitori

Daiso Sangyo is known for cheap and cheerful 100 Yen stores but is fast expansing new higher priced chains which could well cause problems not only...

Michael Causton

Yamada Denki - GINORMOUS Buyback To Dramatically Boost EPS and ROE

Yamada Denki (9831) just announced better-than-consensus guidance, and a HUGE buyback implying a DPS hike. This will move a lot and will still be...

Travis Lundy

Japanese Household Expenditure in 2021 and Beyond: Which Retailers Will Benefit?

Japanese spent more on homes and less on clothes in the last two years but they also added to their savings. This insight analyses the key...

Michael Causton

E-Commerce in Japan: The Big Review

Japan's e-commerce sector expanded rapidly in the last 18 months. The following is a complete review and analysis of the major trends as well as...

Michael Causton

Pan Pacific International Valuation: All Signs Points to a Large Upside in the Short Term

With momentum shifting positive, we think PPI has the largest upside potential among the Japanese semi defensive names with a possible 40% upside...

Oshadhi Kumarasiri

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