IR & Research Intelligence, Sessa Investment Research

Sessa Investment Research

IR & Research Intelligence

Sponsored research focusing on Japanese small cap.

Equity Bottom-Up

<div><div><div><div><ul><li>1H headline numbers were net sales +1.6% YoY, operating expenses +4.8% YoY, with OP turning to loss from ¥293mn → (¥992mn).</li><li>As can be seen from the table on P2, net sales increased by ¥675mn, mainly driven by the ¥1,961mn (+24.6% YoY) increase in priority Content business (revival of events, etc. post COVID-19) offsetting the ¥917mn (-3.5% YoY) decline in Broadcasting due to the harsh environment for TV spot advertising revenues and the ¥275mn (-18.7% YoY) decline in At-home shopping due to special demand associated with COVID-19 subsiding, as well as delays in rolling out new e-commerce initiatives.</li><li>ABC TV’s strategic deployment of programming expenses (¥8,278mn, +5.3% YoY) to strengthen Content-related business also weighed on profits.</li></ul></div></div></div></div>

1H headline numbers were net sales +1.6% YoY, operating expenses +4.8% YoY, with OP turning to loss from ¥293mn → (¥992mn).As can be seen from the table on P2, net sales increased by ¥675mn, mainly driven by the ¥1,961mn (+24.6% YoY) increase in priority Content business (revival of events, etc. post COVID-19) offsetting the ¥917mn (-3.5% YoY) decline in Broadcasting due to the harsh environment for TV spot advertising revenues and the ¥275mn (-18.7% YoY) decline in At-home shopping due to special demand associated with COVID-19 subsiding, as well as delays in rolling out new e-commerce initiatives.ABC TV’s strategic deployment of programming expenses (¥8,278mn, +5.3% YoY) to strengthen Content-related business also weighed on profits.

2Q Follow-Up - Asahi Broadcasting Group Holdings Corporation (9405 JP)

<ul><li>Over the last 5 years, share prices of major terrestrial TV broadcasters have substantially underperformed TOPIX, in large part due to the unprecedented, challenging environment as annual data by Dentsu showed total internet advertising expenditures exceeded total television media advertising expenditures in 2019 for the first time ever, and the annual MIC survey on average time spent using main media showed internet usage time exceeded TV real-time viewing in 2020.</li><li>However, this underperformance trend has begun to change in 2023, as the stock market begins to discount the potential to commercialize the IP value of broadcaster content libraries.</li><li>In February, USEN-NEXT HOLDINGS announced plans to acquire Premium PlatformJapan, Inc. (PPJ), the operator of “Paravi” subscription video distribution service.</li></ul>

Over the last 5 years, share prices of major terrestrial TV broadcasters have substantially underperformed TOPIX, in large part due to the unprecedented, challenging environment as annual data by Dentsu showed total internet advertising expenditures exceeded total television media advertising expenditures in 2019 for the first time ever, and the annual MIC survey on average time spent using main media showed internet usage time exceeded TV real-time viewing in 2020.However, this underperformance trend has begun to change in 2023, as the stock market begins to discount the potential to commercialize the IP value of broadcaster content libraries.In February, USEN-NEXT HOLDINGS announced plans to acquire Premium PlatformJapan, Inc. (PPJ), the operator of “Paravi” subscription video distribution service.

Asahi Broadcasting Group Holdings Corporation (9405 JP) - 4Q Follow-Up

<ul><li><span data-sheets-value='{"1":2,"2":"Continue reading here &gt;&gt; "}' data-sheets-userformat='{"2":513,"3":{"1":0},"12":0}'>Over the last 5 years, share prices of major terrestrial TV broadcasters have substantially underperformed TOPIX, in large part due to the unprecedented, challenging environment as annual data by Dentsu showed total internet advertising expenditures exceeded total television media advertising expenditures in 2019 for the first time ever, and the annual MIC survey on average time spent using main media showed internet usage time exceeded TV real-time viewing in 2020. </span></li><li><span data-sheets-value='{"1":2,"2":"Continue reading here &gt;&gt; "}' data-sheets-userformat='{"2":513,"3":{"1":0},"12":0}'>However, this underperformance trend has begun to change in 2023, as the stock market begins to discount the potential to commercialize the IP value of broadcaster content libraries. </span></li><li><span data-sheets-value='{"1":2,"2":"Continue reading here &gt;&gt; "}' data-sheets-userformat='{"2":513,"3":{"1":0},"12":0}'>In February, USEN-NEXT HOLDINGS announced plans to acquire Premium Platform Japan, Inc. (PPJ), the operator of “Paravi” subscription video distribution service.</span></li></ul>

Over the last 5 years, share prices of major terrestrial TV broadcasters have substantially underperformed TOPIX, in large part due to the unprecedented, challenging environment as annual data by Dentsu showed total internet advertising expenditures exceeded total television media advertising expenditures in 2019 for the first time ever, and the annual MIC survey on average time spent using main media showed internet usage time exceeded TV real-time viewing in 2020. However, this underperformance trend has begun to change in 2023, as the stock market begins to discount the potential to commercialize the IP value of broadcaster content libraries. In February, USEN-NEXT HOLDINGS announced plans to acquire Premium Platform Japan, Inc. (PPJ), the operator of “Paravi” subscription video distribution service.

4Q Follow-Up - Asahi Broadcasting Group Holdings Corporation (9405 JP)

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<p>We view weakness in global equity markets over the past week as correcting a significant amount of the excess optimism. We recommend taking advantage of the pullback by adding exposure to our favorite areas - namely Technology. Our overall outlook on global equities (both the MSCI ACWI and ACWI ex-US) remains positive and we continue to expect higher equity prices going forward.  In today’s report we provide a technical appraisal of all major markets and highlight actionable stocks throughout the int’l Technology and Communications sectors.</p>

We view weakness in global equity markets over the past week as correcting a significant amount of the excess optimism. We recommend taking advantage of the pullback by adding exposure to our favorite areas - namely Technology. Our overall outlook on global equities (both the MSCI ACWI and ACWI ex-US) remains positive and we continue to expect higher equity prices going forward.  In today’s report we provide a technical appraisal of all major markets and highlight actionable stocks throughout the int’l Technology and Communications sectors.

Global-Ex-U.S. Equity Strategy: Add Exposure To Technology, Communications

Japan

ASAHI BROADCASTING CORPORATION sells time slots of the TV and radio broadcasting in western area.  The Company plans and produces programs for TV and radio.  Asahi Broadcasting, affiliated with Asahi Shinbun and TV Asahi, also operates housing business and golf clubs.

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Asahi Broadcasting (9405 JP)

2Q Follow-Up - Asahi Broadcasting Group Holdings Corporation (9405 JP)

1H headline numbers were net sales +1.6% YoY, operating expenses +4.8% YoY, with OP turning to loss from ¥293mn → (¥992mn).

Sessa Investment Research

Asahi Broadcasting Group Holdings Corporation (9405 JP) - 4Q Follow-Up

In February, USEN-NEXT HOLDINGS announced plans to acquire Premium PlatformJapan, Inc. (PPJ), the operator of “Paravi” subscription video...

Sessa Investment Research

4Q Follow-Up - Asahi Broadcasting Group Holdings Corporation (9405 JP)

In February, USEN-NEXT HOLDINGS announced plans to acquire Premium Platform Japan, Inc. (PPJ), the operator of “Paravi” subscription video...

Sessa Investment Research

Global-Ex-U.S. Equity Strategy: Add Exposure To Technology, Communications

We view weakness in global equity markets over the past week as correcting a significant amount of the excess optimism. We recommend taking...

Vermilion Research

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