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>Analysts are expecting cashless payments in Japan for 2021 to show further accelerated growth in the use of mobile payment apps.</li>
<li>Surveys suggest consumers rapidly increased their use of mobile payments and are even expressing frustration when the service is unavailable. </li>
<li>PayPay is utterly dominant with nearly 50% share based on survey responses. We expect consolidation below from NTT, Mercari, Rakuten and KDDI.</li>
</ul>


Analysts are expecting cashless payments in Japan for 2021 to show further accelerated growth in the use of mobile payment apps.
Surveys suggest consumers rapidly increased their use of mobile payments and are even expressing frustration when the service is unavailable. 
PayPay is utterly dominant with nearly 50% share based on survey responses. We expect consolidation below from NTT, Mercari, Rakuten and KDDI.


Growth in Cashless Payments Surges in Japan – PayPay Totally Dominant

Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

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>Mercari opened down 11.7% and has now recovered to be down “only” 8.5%. </li>
<li>While our impression of results yesterday was negative the intensity of the move is overdone in our view. </li>
<li>We still believe that momentum is likely to be muted for a while but the current price is not unattractive.</li>
</ul>


Mercari opened down 11.7% and has now recovered to be down “only” 8.5%. 
While our impression of results yesterday was negative the intensity of the move is overdone in our view. 
We still believe that momentum is likely to be muted for a while but the current price is not unattractive.


<ul>
<li>We got this wrong, expecting a beat on margins in spite of weak GMV, whereas Mercari actually fell into the red for the first time in six quarters. </li>
<li>The culprit is extremely aggressive promotional spend which looks to have hit all time highs in both Japan and the US. </li>
<li>The shift to an investment stance is not in and of itself a bad thing but the growth relative to the spend is disappointing so far.</li>
</ul>


We got this wrong, expecting a beat on margins in spite of weak GMV, whereas Mercari actually fell into the red for the first time in six quarters. 
The culprit is extremely aggressive promotional spend which looks to have hit all time highs in both Japan and the US. 
The shift to an investment stance is not in and of itself a bad thing but the growth relative to the spend is disappointing so far.


Telco/Internet specialist

Kirk Boodry

Redex Research

<ul>
<li>Q3 21 in-line for revenue but well ahead for EBITDA on solid advertising growth leading to an upgrade in management's full-year EBITDA target.</li>
<li>Operational results were encouraging with double-digit gains in ad sales and 7% eCommerce growth despite strong year-ago comps.</li>
<li>Impairment losses for equity associate Demae-Can sting but the overall story is positive.</li>
</ul>


Q3 21 in-line for revenue but well ahead for EBITDA on solid advertising growth leading to an upgrade in management's full-year EBITDA target.
Operational results were encouraging with double-digit gains in ad sales and 7% eCommerce growth despite strong year-ago comps.
Impairment losses for equity associate Demae-Can sting but the overall story is positive.


Z Holdings (Buy) Q3 21 Results Reaction: Mostly Positive as Ad Sales Continues to Impress

<ul>
<li>Mercari is down 33% since 22 November, actually underperforming the 31% decline in Mothers. </li>
<li>YoY numbers for the US may only modestly beat the 20% growth target for the year and this reset of expectations may have been the driver of the decline. </li>
<li>However, we expect significant upside surprises on profitability and that is our focus.</li>
</ul>


Mercari is down 33% since 22 November, actually underperforming the 31% decline in Mothers. 
YoY numbers for the US may only modestly beat the 20% growth target for the year and this reset of expectations may have been the driver of the decline. 
However, we expect significant upside surprises on profitability and that is our focus.


Mercari – US GMV Is Downside Risk but Profitability Is a Larger Upside Risk

Japan

Mercari, Inc. operates as an electronic commercial company. The Company offers electronic commercial software, operation management, marketing planning, and other marketplace services. Mercari serves customers worldwide.

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Mercari (4385 JP)

Growth in Cashless Payments Surges in Japan – PayPay Totally Dominant

Japan is shifting from 80-90% cash retail transactions to 40-50% cashless in the blink of an eye. Softbank/Z HD dominates with nearly 50% share and...

Michael Causton

Mercari – Don’t Panic Sell

Mercari opened down 11.7% and has now recovered to be down “only” 8.5%. While our impression of results yesterday was negative the intensity of the...

Mio Kato

Mercari – Margin Miss Not Beat

We got this wrong, expecting a beat on margins whereas Mercari actually fell into the red. A shift to an investment stance is not bad but the...

Mio Kato

Z Holdings (Buy) Q3 21 Results Reaction: Mostly Positive as Ad Sales Continues to Impress

This was a good quarter with better-than-expected growth in eCommerce, ad sales and cashless payments and an upgrade to the full-year EBITDA target...

Kirk Boodry

Mercari – US GMV Is Downside Risk but Profitability Is a Larger Upside Risk

Mercari's YoY numbers for the US may only modestly beat the 20% growth target for the year, however, we expect significant upside surprises on...

Mio Kato

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