Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/suzuki-motor-corp" target="_blank" data-smartkarma-citation="entities:732:1" rel="noopener">Suzuki Motor (7269 JP)</a>'s implied stub is currently around its all-time low, as is the simple ratio (Suzuki/<a href="https://www.smartkarma.com/entities/maruti-suzuki-india-ltd" target="_blank" data-smartkarma-citation="entities:733:1" rel="noopener">Maruti Suzuki India (MSIL IN)</a>).</li>
<li>The global transition to electric vehicles is underway, spurred on by environmental concerns, government legislation, and financial incentives.</li>
<li>Maruti remains steadfast in its support for hybrid vehicles. In the long run, that's a liability.</li>
</ul>



Suzuki Motor (7269 JP)'s implied stub is currently around its all-time low, as is the simple ratio (Suzuki/Maruti Suzuki India (MSIL IN)).
The global transition to electric vehicles is underway, spurred on by environmental concerns, government legislation, and financial incentives.
Maruti remains steadfast in its support for hybrid vehicles. In the long run, that's a liability.


Suzuki's All-Time Low Stub As Maruti Faces Electric Vehicle Crossroad

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>Suzuki reported its 3QFY22 results on Friday with revenue of ¥901bn (+8.8% QoQ, -0.5% YoY) and OP of ¥47.5bn implying an OPM of 5.3% compared to 5.3% in 2QFY22. </li>
<li>The reported revenue and OP were 3.8% and 5.9% higher than the consensus estimates respectively. </li>
<li>The company revised its full year revenue guidance to ¥3,400bn (¥200bn up from the previous guidance), while OP guidance remained unchanged on ¥170bn.</li>
</ul>


Suzuki reported its 3QFY22 results on Friday with revenue of ¥901bn (+8.8% QoQ, -0.5% YoY) and OP of ¥47.5bn implying an OPM of 5.3% compared to 5.3% in 2QFY22. 
The reported revenue and OP were 3.8% and 5.9% higher than the consensus estimates respectively. 
The company revised its full year revenue guidance to ¥3,400bn (¥200bn up from the previous guidance), while OP guidance remained unchanged on ¥170bn.


Equity Long-Short Analyst

Pyari Menon

Thematic (Sector/Industry)

In this report, we have crawled through over ten years of technical publications to analyze the Fuel Cell space. The top five companies we screen from a technology perspective are <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota Motor (7203 JP)</a>, <a href="https://www.smartkarma.com/entities/honda-motor-co-ltd" target="_blank" data-smartkarma-citation="entities:154:1" rel="noopener">Honda Motor (7267 JP)</a>, <a href="https://www.smartkarma.com/entities/hyundai-motor-co" target="_blank" data-smartkarma-citation="entities:155:1" rel="noopener">Hyundai Motor Co (005380 KS)</a>, <a href="https://www.smartkarma.com/entities/general-motors-co" target="_blank" data-smartkarma-citation="entities:18811:1" rel="noopener">General Motors Co (GM US)</a>, and <a href="https://www.smartkarma.com/entities/bloom-energy-corp" target="_blank" data-smartkarma-citation="entities:34062:1" rel="noopener">Bloom Energy Corp (BE US)</a> Technologically automakers (Japanese in particular) dominate the fuel cell sector. Among pure plays, <a href="https://www.smartkarma.com/entities/bloom-energy-corp" target="_blank" data-smartkarma-citation="entities:34062:1" rel="noopener">Bloom Energy Corp (BE US)</a> and <a href="https://www.smartkarma.com/entities/ballard-power-systems-inc" target="_blank" data-smartkarma-citation="entities:25813:1" rel="noopener">Ballard Power Systems (BLDP CN)</a> are best positioned and perhaps the only ones who come somewhat close to the auto OEMs from a technology perspective. Some lesser-known private players that have gained traction in technological terms over the last five years are Dioxide Materials, 24M Technologies, and Bayotech.Currently, batteries have a decisive advantage over fuel cells, and as a business proposition, fuel cells have so far mostly failed to live up to their technological promise. However, fuel cells using hydrogen generated from renewables offer a much lower environmental impact across their lifecycle. This sustains investor interest in the hope that system price declines, economies of scale, lower cost of renewable energy generation, and maturation as a business could make FC competitive longer term.

In this report, we have crawled through over ten years of technical publications to analyze the Fuel Cell space. The top five companies we screen from a technology perspective are Toyota Motor (7203 JP), Honda Motor (7267 JP), Hyundai Motor Co (005380 KS), General Motors Co (GM US), and Bloom Energy Corp (BE US) Technologically automakers (Japanese in particular) dominate the fuel cell sector. Among pure plays, Bloom Energy Corp (BE US) and Ballard Power Systems (BLDP CN) are best positioned and perhaps the only ones who come somewhat close to the auto OEMs from a technology perspective. Some lesser-known private players that have gained traction in technological terms over the last five years are Dioxide Materials, 24M Technologies, and Bayotech.Currently, batteries have a decisive advantage over fuel cells, and as a business proposition, fuel cells have so far mostly failed to live up to their technological promise. However, fuel cells using hydrogen generated from renewables offer a much lower environmental impact across their lifecycle. This sustains investor interest in the hope that system price declines, economies of scale, lower cost of renewable energy generation, and maturation as a business could make FC competitive longer term.

Stock Ideas From Data Mining Technical Publications: A Look into Fuel Cells

<ul>
<li>Suzuki reported its 2QFY22 results on Thursday which saw both revenue and OP decline compared to 1QFY22.</li>
<li>The company posted revenue of ¥828bn (-2.0% QoQ) and operating profits of ¥45bn (-18.0% YoY) implying an OPM of 5.4% compared to 6.4% in 1QFY22.</li>
<li>However, the reported revenue was 3.6% higher than consensus estimates while Suzuki’s OP beat consensus estimates by 21.4%.</li>
</ul>


Suzuki reported its 2QFY22 results on Thursday which saw both revenue and OP decline compared to 1QFY22.
The company posted revenue of ¥828bn (-2.0% QoQ) and operating profits of ¥45bn (-18.0% YoY) implying an OPM of 5.4% compared to 6.4% in 1QFY22.
However, the reported revenue was 3.6% higher than consensus estimates while Suzuki’s OP beat consensus estimates by 21.4%.


Suzuki Motor – Weaker Results but Better than Consensus

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Among active Global managers, Japan Consumer Discretionary stocks are the 3rd largest country/sector holding in the Asia region.  Average fund weights sit behind Taiwan Tech and Japan Industrials at 1.07%, with 57.1% of the 380 funds in our analysis invested in the sector with combined AUM of $9.18bn.Measured against other Asian country/sectors, changes in fund ownership have been positive and among the highest across all measures over the last 6-months.  Against a backdrop of plummeting exposure in China Consumer Discretionary stocks, average weights, funds invested, cash flows and the balance of buyers vs sellers were all positive for Japan Consumer Discretionary stocks.  Infact, across most ownership metrics, Japan Consumer Discretionary stocks have overtaken, or at least closed to gap to China Consumer Discretionary stocks since the 'Tech Crackdown' in October of 2020.  We can see evidence of this rotation on a fund level, with Aberdeen's Global Unconstrained Fund, LBPAM's Actions Monde and BNY Mellon's Global Opportunities Fund examples of managers rotating from China Consumer Discretionary and into Japan since October 2020.Analysis taken from our Global research, covering 380 active Global strategies with combined AUM of $1.1bn

Among active Global managers, Japan Consumer Discretionary stocks are the 3rd largest country/sector holding in the Asia region.  Average fund weights sit behind Taiwan Tech and Japan Industrials at 1.07%, with 57.1% of the 380 funds in our analysis invested in the sector with combined AUM of $9.18bn.Measured against other Asian country/sectors, changes in fund ownership have been positive and among the highest across all measures over the last 6-months.  Against a backdrop of plummeting exposure in China Consumer Discretionary stocks, average weights, funds invested, cash flows and the balance of buyers vs sellers were all positive for Japan Consumer Discretionary stocks.  Infact, across most ownership metrics, Japan Consumer Discretionary stocks have overtaken, or at least closed to gap to China Consumer Discretionary stocks since the 'Tech Crackdown' in October of 2020.  We can see evidence of this rotation on a fund level, with Aberdeen's Global Unconstrained Fund, LBPAM's Actions Monde and BNY Mellon's Global Opportunities Fund examples of managers rotating from China Consumer Discretionary and into Japan since October 2020.Analysis taken from our Global research, covering 380 active Global strategies with combined AUM of $1.1bn

Japan Consumer Discretionary:  Benefiting from China's Downfall

Japan

Suzuki Motor Corporation manufactures automobiles, motorcycles, and their related parts. The Company has production facilities in USA, Japan, Taiwan, India, Pakistan, Indonesia, Thailand, and Hungary.

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Suzuki Motor (7269 JP)

Suzuki's All-Time Low Stub As Maruti Faces Electric Vehicle Crossroad

Suzuki Motor's implied stub is currently around its all-time low, as is the simple ratio. Maruti remains steadfast in its support for hybrid...

David Blennerhassett

Suzuki – Steady but Nothing Special

Suzuki results beat consensus slightly but while guidance is typically conservative there is a small risk of an undershoot vs. FY consensus estimates.

Mio Kato

Stock Ideas From Data Mining Technical Publications: A Look into Fuel Cells

Fuel cells have a place in the green energy market but with poor economics, they have a problem finding where that is. Japanese automakers...

Pyari Menon

Suzuki Motor – Weaker Results but Better than Consensus

Suzuki's results continue to be held back by weakness at MSIL but a quicker than expected production ramp there could offer upside.

Mio Kato

Japan Consumer Discretionary: Benefiting from China's Downfall

Against a backdrop of plummeting exposure in China Consumer Discretionary stocks, active Global managers have pivoted towards the Japan Consumer...

Steven Holden

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