Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Hamamatsu Photonics Kk / Equity Capital Markets

<ul>
<li>
<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> aims to raise around US$190m via selling over a 4% stake in <a href="https://www.smartkarma.com/entities/hamamatsu-photonics-kk" target="_blank" data-smartkarma-citation="entities:14074:1" rel="noopener">Hamamatsu Photonics Kk (6965 JP)</a>.</li>
<li>This is another cross-shareholding unwind and hence, won’t be a huge surprise. Although given the recent share price weakness, the timing appears peculiar.</li>
<li>In this note, we will talk about the deal dynamics and run the deal through our ECM framework.</li>
</ul>



Toyota Motor (7203 JP) aims to raise around US$190m via selling over a 4% stake in Hamamatsu Photonics Kk (6965 JP).
This is another cross-shareholding unwind and hence, won’t be a huge surprise. Although given the recent share price weakness, the timing appears peculiar.
In this note, we will talk about the deal dynamics and run the deal through our ECM framework.


Hamamatsu Photonics Placement - Peculiar Timing

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Today after the close we got news that after a year-plus of <a href="https://www.smartkarma.com/entities/hamamatsu-photonics-kk" target="_blank" data-smartkarma-citation="entities:14074:1" rel="noopener">Hamamatsu Photonics Kk (6965 JP)</a>'s sliding stock price, <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> is selling their 5+% stake.</li>
<li>The offering is standard. Probably prices 9 Sep 2024. HP's amended buyback program and probable index upweights offset most of the offering size over the next several months.</li>
<li>So investors have to decide whether they want to catch the falling knife.</li>
</ul>


Today after the close we got news that after a year-plus of Hamamatsu Photonics Kk (6965 JP)'s sliding stock price, Toyota Motor (7203 JP) is selling their 5+% stake.
The offering is standard. Probably prices 9 Sep 2024. HP's amended buyback program and probable index upweights offset most of the offering size over the next several months.
So investors have to decide whether they want to catch the falling knife.


Hamamatsu Photonics (6965) - Toyota Selling Yet Another Cross-Holding

Senior Technology Analyst, Japanese Equities, LightStream Research

Scott Foster

Senior Technology Analyst, Japanese Equities

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

Hamamatsu Photonics Kk / Equity Bottom-Up

<ul>
<li>The company has slashed FY Sep-24 guidance after missing 1H sales and profit targets by wide margins. Dividend maintained, 2-for-1 split planned and buyback under consideration.</li>
<li>Capex has been cut, reflecting lower growth expectations. R&amp;D also. Inventory adjustments will eventually be completed, but Chinese competiton will remain a problem.</li>
<li>The share price has dropped 30% in the past year and 10.5% since May 8, putting the shares on 27 times EPS guidance. Still not cheap, but getting there.</li>
</ul>


The company has slashed FY Sep-24 guidance after missing 1H sales and profit targets by wide margins. Dividend maintained, 2-for-1 split planned and buyback under consideration.
Capex has been cut, reflecting lower growth expectations. R&amp;D also. Inventory adjustments will eventually be completed, but Chinese competiton will remain a problem.
The share price has dropped 30% in the past year and 10.5% since May 8, putting the shares on 27 times EPS guidance. Still not cheap, but getting there.


Hamamatsu Photonics (6965 JP): Look Cautiously to the Long Term

<ul>
<li>FY Sep-22 results are likely to beat management's guidance, but this should be in the price. Recession and rising interest rates are probably not in the price.</li>
<li>Growth rates slowed in 3Q and are likely to decline further in 4Q. In the year ahead, we expect both sales and profits to decline.</li>
<li>The shares have rebounded by 21% since the 1st of July to 30x our EPS estimate for FY Sep-23. This does not look sustainable. Sell into current strength. </li>
</ul>


FY Sep-22 results are likely to beat management's guidance, but this should be in the price. Recession and rising interest rates are probably not in the price.
Growth rates slowed in 3Q and are likely to decline further in 4Q. In the year ahead, we expect both sales and profits to decline.
The shares have rebounded by 21% since the 1st of July to 30x our EPS estimate for FY Sep-23. This does not look sustainable. Sell into current strength. 


Hamamatsu Photonics (6965 JP): Difficult Year Ahead

<ul>
<li>The shares are down 27% from their May high, largely discounting excessive inventory and a decline in profits that is likely to continue through next March or June.</li>
<li>Inventory adjustment, the revival of semiconductor, factory automation and medical related demand, plus the leveling off of depreciation, should enable a return to growth after that. </li>
<li>Projected valuations are at the low end of their 10-year ranges. Buy into the current weakness, keeping in mind that 1Q results are likely to be weak.</li>
</ul>


The shares are down 27% from their May high, largely discounting excessive inventory and a decline in profits that is likely to continue through next March or June.
Inventory adjustment, the revival of semiconductor, factory automation and medical related demand, plus the leveling off of depreciation, should enable a return to growth after that. 
Projected valuations are at the low end of their 10-year ranges. Buy into the current weakness, keeping in mind that 1Q results are likely to be weak.


Hamamatsu Photonics (6965 JP): Buy into Current Weakness

Japan

HAMAMATSU PHOTONICS K.K. manufactures electron tubes, semiconductors, and image processors.  The Company's products include photosensitive electronic tubes, optical/image sensors, X-ray related products, laser related products, photodiodes, light-emitting diodes (LED) and video camera used for measuring equipment.

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Hamamatsu Photonics Kk (6965 JP)

Hamamatsu Photonics Placement - Peculiar Timing

Toyota Motor (7203 JP) aims to raise around US$190m via selling over a 4% stake in Hamamatsu Photonics Kk (6965 JP). The timing of the selldown...

Sumeet Singh

Hamamatsu Photonics (6965) - Toyota Selling Yet Another Cross-Holding

Hamamatsu Photonics today announced that in response to Toyota's desire to sell its entire stake, there would be a secondary offering. They...

Travis Lundy

Hamamatsu Photonics (6965 JP): Look Cautiously to the Long Term

Management blindsided by weak 2Q, but sharp cut to guidance largely discounted. Dividend maintained, stock split coming, buyback possible. But...

Scott Foster

Hamamatsu Photonics (6965 JP): Difficult Year Ahead

Shares up 21% since July, but sales and profits likely to decline in FY Sep-23. Impact of recession and semiconductor downturn unavoidable. Rising...

Scott Foster

Hamamatsu Photonics (6965 JP): Buy into Current Weakness

Shares down 27%, largely discounting excessive inventory and falling profits. Profits should rebound with semiconductor and other demand as...

Scott Foster

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