Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>OVERSEAS.  SPX hit 52W highs as Yellen sees no US Recession;  Rates fall on "inflation behind us" narrative; Global HF unwind bearish US positions; EV WARS as Ford Slashes prices.  </li>
<li>JAPAN.  NKY Futures -0.2% vs Cash; USDJPY 138.7%; Japan Back after Marine Day Holidays to lower US rates, stronger yen, Weaker China, and Tech bid; Blackrock lifts Japan stock outlook </li>
<li>NUGGET.  JAL(9201) Double Winner(Margins+Emmissions) with Fleet Upgrade. Share price has run, but strong tailwinds on demand and operational efficiency. Watch for pullback to pick up.</li>
</ul>


OVERSEAS.  SPX hit 52W highs as Yellen sees no US Recession;  Rates fall on "inflation behind us" narrative; Global HF unwind bearish US positions; EV WARS as Ford Slashes prices.  
JAPAN.  NKY Futures -0.2% vs Cash; USDJPY 138.7%; Japan Back after Marine Day Holidays to lower US rates, stronger yen, Weaker China, and Tech bid; Blackrock lifts Japan stock outlook 
NUGGET.  JAL(9201) Double Winner(Margins+Emmissions) with Fleet Upgrade. Share price has run, but strong tailwinds on demand and operational efficiency. Watch for pullback to pick up.


Ohayo Japan|Equities Cruise on No Recession Narrative; NUGGET: JAL(9201) A Double Winner

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>Nihon M&amp;A reported 4QFY03/2023 results last week. Revenue increased 86.7% YoY to ¥11.4bn (vs consensus ¥10.0bn) while OP for the quarter more than quadrupled to ¥4.2bn (vs consensus ¥4.9bn).</li>
<li>Full-Year FY03/2023 revenue of ¥41.3bn and OP of ¥15.3bn were slightly below guidance of ¥42bn and ¥18bn respectively and the company has put aside its medium-term growth plan by 2years.</li>
<li>We continue to prefer Baycurrent over <a href="https://www.smartkarma.com/entities/nihon-m-a-center-inc" target="_blank" data-smartkarma-citation="entities:17616:1" rel="noopener">Nihon M&amp;A Center (2127 JP)</a> in the Japanese consulting/M&amp;A space as Baycurrent continues to make strong progress.</li>
</ul>


Nihon M&amp;A reported 4QFY03/2023 results last week. Revenue increased 86.7% YoY to ¥11.4bn (vs consensus ¥10.0bn) while OP for the quarter more than quadrupled to ¥4.2bn (vs consensus ¥4.9bn).
Full-Year FY03/2023 revenue of ¥41.3bn and OP of ¥15.3bn were slightly below guidance of ¥42bn and ¥18bn respectively and the company has put aside its medium-term growth plan by 2years.
We continue to prefer Baycurrent over Nihon M&amp;A Center (2127 JP) in the Japanese consulting/M&amp;A space as Baycurrent continues to make strong progress.


Nihon M&A: Puts Aside Mid-Term Growth Plan by Two Years

BayCurrent Consulting  / Equity Bottom-Up

<ul>
<li>Baycurrent reported fourth quarter and full-year FY02/2023 results on Friday. 4Q revenues increased 32.1% YoY to ¥21.2bn (vs consensus ¥20.7bn) and OP increased 60.8% to ¥9.6bn (vs consensus ¥8.3bn).</li>
<li>Full-Year revenue and OP increased 32% and 39% YoY respectively to ¥76.1bn and ¥29.9bn, beating own guidance by 7% and 15% respectively.</li>
<li>The company’s FY02/2023E guidance is too conservative as there has been no signs of an earnings slowdown as DX consulting and high-value add projects would drive next phase of growth.</li>
</ul>


Baycurrent reported fourth quarter and full-year FY02/2023 results on Friday. 4Q revenues increased 32.1% YoY to ¥21.2bn (vs consensus ¥20.7bn) and OP increased 60.8% to ¥9.6bn (vs consensus ¥8.3bn).
Full-Year revenue and OP increased 32% and 39% YoY respectively to ¥76.1bn and ¥29.9bn, beating own guidance by 7% and 15% respectively.
The company’s FY02/2023E guidance is too conservative as there has been no signs of an earnings slowdown as DX consulting and high-value add projects would drive next phase of growth.


Baycurrent Consulting: Strong Earnings Beat with an Overly Conservative Guidance

<ul>
<li>OVERSEAS. SPX Rise as Cycicals/Tech bid; Higher Rates; Strong USD, No problem !   Market seems to have concluded that higher rates+strong economy is a workable outcome.</li>
<li>JAPAN. NKY Futs +0.4% vs Cash; USDJPY weakens to 134.1; Weak Yen Narrative to dominate; Do not say to "Mr Yen" who sees 120 ;  BULLISH Inbound but priced in</li>
<li>DAILY NUGGET. BayCurrent Consulting (6532) - Still lot of tailwinds..still BULLISH.</li>
</ul>


OVERSEAS. SPX Rise as Cycicals/Tech bid; Higher Rates; Strong USD, No problem !   Market seems to have concluded that higher rates+strong economy is a workable outcome.
JAPAN. NKY Futs +0.4% vs Cash; USDJPY weakens to 134.1; Weak Yen Narrative to dominate; Do not say to "Mr Yen" who sees 120 ;  BULLISH Inbound but priced in
DAILY NUGGET. BayCurrent Consulting (6532) - Still lot of tailwinds..still BULLISH.


Good Morning Japan |GOLDILOCKS?: Higher Rates, Strong USD=Higher Equities; In JP, Mr Yen Says 120

<ul>
<li>OVERSEAS. SPX -1.1% as Fed Hawks rhetoric ratches up; All 11 Sectors -ve as Beta Sold; ALPHABET-7.7% AI fails to impress; Disney +8% after-hours with earnings beat/job cuts. </li>
<li>JAPAN.  NKY Futs -0.8% vs Cash; USDJPY 131.41; Japan looking to ease restrictions for China Inbound;  EARNINGS: Pan Pac/SMM Strong vs weak Subaru which -ve production cut; Toyota out today. </li>
<li>DAILY NUGGETS. EPIC fail from Alphabet's "BARD". Aren't these events supposed to  be choreographed ????</li>
</ul>


OVERSEAS. SPX -1.1% as Fed Hawks rhetoric ratches up; All 11 Sectors -ve as Beta Sold; ALPHABET-7.7% AI fails to impress; Disney +8% after-hours with earnings beat/job cuts. 
JAPAN.  NKY Futs -0.8% vs Cash; USDJPY 131.41; Japan looking to ease restrictions for China Inbound;  EARNINGS: Pan Pac/SMM Strong vs weak Subaru which -ve production cut; Toyota out today. 
DAILY NUGGETS. EPIC fail from Alphabet's "BARD". Aren't these events supposed to  be choreographed ????


Good Morning Japan |Hawks Re-Emerge + Epic "BARD" Fail Sinks Google; Pan Pac Beat/Subaru Miss

Japan

Baycurrent Consulting , Inc. offers comprehensive consulting services in a wide variety of industries. The company's main focus areas are business strategy consulting, IT consulting, and IT integration.

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BayCurrent Consulting (6532 JP)

Ohayo Japan|Equities Cruise on No Recession Narrative; NUGGET: JAL(9201) A Double Winner

SPX hit 52W highs as no recession/inflation behind us narrative dominates; NKY Futures -0.2% vs Cash; USDJPY 138.7%; Japan to lower US rates,...

Mark Chadwick

Nihon M&A: Puts Aside Mid-Term Growth Plan by Two Years

Nihon M&A's FY03/2023 earnings were below its own guidance and the company has put aside its mid-term growth plan by 2 years. We prefer Baycurrent...

Shifara Samsudeen, ACMA, CGMA

Baycurrent Consulting: Strong Earnings Beat with an Overly Conservative Guidance

Baycurrent's 4Q earnings beat estimate and FY02/2024E guidance was too conservative. The company has managed to beat top line guidance every year...

Shifara Samsudeen, ACMA, CGMA

Good Morning Japan |GOLDILOCKS?: Higher Rates, Strong USD=Higher Equities; In JP, Mr Yen Says 120

NKY Futs +0.4% vs Cash; USDJPY weakens to 134.1. Weak yen to dominate today as strong US macro datapoints drive up the USD. A strong US economy...

Mark Chadwick

Good Morning Japan |Hawks Re-Emerge + Epic "BARD" Fail Sinks Google; Pan Pac Beat/Subaru Miss

Fed Hawks rhetoric ratches up; ALHABET-7.7% AI fails to impress; . Japan looking to ease restrictions for China Inbound; JAPAN EARNINGS: Pan Pac...

Mark Chadwick

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