Japan Experts, Extraordinary Performance, Astris Advisory Japan

Astris Advisory Japan

Japan Experts, Extraordinary Performance

Our Corporate Advisory service is designed to give clients access to a wider range of investors. These include Japan specialists as well as global investors. The goal is to help achieve a fair equity valuation.

Equity Bottom-Up

<ul><li>Strong execution on multiple fronts – Q1-2 FY4/2024 results were ahead of expectations, with sales growth of 205.2% YoY and operating profit growth of 572.1% YoY.</li><li>Whilst acquisitive growth was to be expected, HEROZ has also demonstrated 1) organic growth in its AI/DX Service with underlying sales growth of 14.6% YoY,</li><li>2) increased the proportion of recurring revenue to 62.4% of total sales and thereby continuing to improve earnings visibility</li></ul>

Strong execution on multiple fronts – Q1-2 FY4/2024 results were ahead of expectations, with sales growth of 205.2% YoY and operating profit growth of 572.1% YoY.Whilst acquisitive growth was to be expected, HEROZ has also demonstrated 1) organic growth in its AI/DX Service with underlying sales growth of 14.6% YoY,2) increased the proportion of recurring revenue to 62.4% of total sales and thereby continuing to improve earnings visibility

Heroz (4382 JP) - Growing Evidence of Positive Transformation

<ul><li>HEROZ is an AI technology company that provides advanced AI development expertise to both B2C and B2B sectors.</li><li>With a strategic focus on AI SaaS, it has embarked on a ‘buy-to-build’ strategy to develop profitable recurring revenue streams and accelerate earnings growth.</li><li>In September 2022, it consolidated VarioSecure (4494), a subsidiary offering network security services, and in August 2022 acquired Strategit, a SaaS integration development support business.</li></ul>

HEROZ is an AI technology company that provides advanced AI development expertise to both B2C and B2B sectors.With a strategic focus on AI SaaS, it has embarked on a ‘buy-to-build’ strategy to develop profitable recurring revenue streams and accelerate earnings growth.In September 2022, it consolidated VarioSecure (4494), a subsidiary offering network security services, and in August 2022 acquired Strategit, a SaaS integration development support business.

Heroz (4382) - Tailoring Business Growth Opportunities

Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

Shinko Electric Industries / Event-Driven

<ul>
<li>JPX-Nikkei 400 is composed of stocks listed on the Tokyo Stock Exchange selected based on multiple metrics relating to size, liquidity, financial performance, and corporate governance.</li>
<li>The annual rebalance of the JPX-Nikkei 400 Index takes place in August every year and the cut-off date for the data used for this rebalance is the end of June.</li>
<li>In this insight, we take a look at Quiddity's final predictions for Potential ADDs/DELs for the August 2022 review.</li>
</ul>


JPX-Nikkei 400 is composed of stocks listed on the Tokyo Stock Exchange selected based on multiple metrics relating to size, liquidity, financial performance, and corporate governance.
The annual rebalance of the JPX-Nikkei 400 Index takes place in August every year and the cut-off date for the data used for this rebalance is the end of June.
In this insight, we take a look at Quiddity's final predictions for Potential ADDs/DELs for the August 2022 review.


JPX-Nikkei 400 2022 Rebal: Final Predictions

'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

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.

Thematic (Sector/Industry)

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/158/456/original/2020-09-12_13-08-43.png?1599883751" class="editor-image img-responsive" data-smartkarma-image-id="158456"></figure><div class="content-caption">Source for all Charts: Japan Analytics</div><p><strong>YET TO BOTTOM OUT</strong> - As we finish the first batch of results covering the period from May to July, our scoring of Results, Annual, and Interim Revisions has yet to see a bottoming out in momentum. Nevertheless, the market, aided by ample liquidity, has already discounted the first six months of a potential recovery. The market's optimism is supported by the Cabinet Office Leading Indicator of Business Conditions which, as of July, had seen two months of recovery.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/158/458/original/2020-09-12_13-20-58.png?1599884472" class="editor-image img-responsive" data-smartkarma-image-id="158458"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/158/459/original/2020-09-12_13-31-24.png?1599885118" class="editor-image img-responsive" data-smartkarma-image-id="158459"></figure><p></p><hr><p style="text-align: center;"><strong>• BEST &amp; WORST •</strong></p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/158/449/original/2020-09-12_10-38-08.png?1599874697" class="editor-image img-responsive" data-smartkarma-image-id="158449"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/158/451/original/2020-09-12_10-40-00.png?1599874819" class="editor-image img-responsive" data-smartkarma-image-id="158451"></figure><p>Our picks of the 'best' from Friday's announcements are logistics infrastructure company <a href="https://www.smartkarma.com/entities/cre-inc-japan" target="_blank" data-smartkarma-citation="entities:25924:1" rel="noopener">CRE (3458 JP)</a> and personal products provider <a href="https://www.smartkarma.com/entities/ya-man-ltd" target="_blank" data-smartkarma-citation="entities:16129:1" rel="noopener">Ya Man (6630 JP)</a>. The 'worst' results were from Ai gaming company <a href="https://www.smartkarma.com/entities/heroz-inc" target="_blank" data-smartkarma-citation="entities:27106:1" rel="noopener">Heroz (4382 JP)</a> and commercial design and display specialist <a href="https://www.smartkarma.com/entities/tanseisha-co-ltd" target="_blank" data-smartkarma-citation="entities:10898:1" rel="noopener">Tanseisha (9743 JP)</a>, the latter due to a severe downward revision for the full year. </p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/158/452/original/2020-09-12_10-41-46.png?1599874918" class="editor-image img-responsive" data-smartkarma-image-id="158452"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/158/453/original/2020-09-12_10-43-21.png?1599875013" class="editor-image img-responsive" data-smartkarma-image-id="158453"></figure><p style="text-align: center;"></p><div>
<hr>
<p style="text-align: center;"><strong>DAILY STATS</strong></p>
</div><hr><div><div class="content-highlight"><p style="text-align: left;"><strong>PERCENTAGES</strong> -<strong>50%</strong> of quarterly results, <strong>66%</strong> of annual forecasts/revisions and<strong> 69%</strong> of interim forecasts have negative Scores. <strong>29%</strong> of companies reporting lost money for the quarter.</p></div></div><hr><div><p style="text-align: center;"><strong>48 Quarterly Results</strong></p></div><div><ul style="list-style-type: disc;">
<li>
<strong>Results Score:</strong> 46% Positive / 4% Neutral / 50% Negative</li>
<li>
<strong>Average Results Score Change:</strong> +0.9 points</li>
<li>
<strong>Average % Change in Revenue:</strong> -5.8% Quarter YoY / -3.7% Rolling TTM YoY </li>
<li>Average Operating Profit Margin Change: -4.1ppt</li>
<li>Percentage Making Quarterly Losses: 29%</li>
</ul></div><hr><div><p style="text-align: center;"><strong>29 Annual • 13 Interim Forecasts/Revisions</strong></p></div><div><ul style="list-style-type: disc;">
<li>
<strong>Annual Forecast/Revision Score:</strong> 31% Positive / 3% Neutral / 66% Negative</li>
<li>
<strong>Interim Forecast/Revision Score Change:</strong> 23% Positive / 8% Neutral / 69% Negative</li>
<li>
<strong>Average Forecast/Revision Score Change:</strong> -6.9 points</li>
</ul></div>

Source for all Charts: Japan AnalyticsYET TO BOTTOM OUT - As we finish the first batch of results covering the period from May to July, our scoring of Results, Annual, and Interim Revisions has yet to see a bottoming out in momentum. Nevertheless, the market, aided by ample liquidity, has already discounted the first six months of a potential recovery. The market's optimism is supported by the Cabinet Office Leading Indicator of Business Conditions which, as of July, had seen two months of recovery.• BEST &amp; WORST •Our picks of the 'best' from Friday's announcements are logistics infrastructure company CRE (3458 JP) and personal products provider Ya Man (6630 JP). The 'worst' results were from Ai gaming company Heroz (4382 JP) and commercial design and display specialist Tanseisha (9743 JP), the latter due to a severe downward revision for the full year. 

DAILY STATS
PERCENTAGES -50% of quarterly results, 66% of annual forecasts/revisions and 69% of interim forecasts have negative Scores. 29% of companies reporting lost money for the quarter.48 Quarterly Results

Results Score: 46% Positive / 4% Neutral / 50% Negative

Average Results Score Change: +0.9 points

Average % Change in Revenue: -5.8% Quarter YoY / -3.7% Rolling TTM YoY 
Average Operating Profit Margin Change: -4.1ppt
Percentage Making Quarterly Losses: 29%
29 Annual • 13 Interim Forecasts/Revisions

Annual Forecast/Revision Score: 31% Positive / 3% Neutral / 66% Negative

Interim Forecast/Revision Score Change: 23% Positive / 8% Neutral / 69% Negative

Average Forecast/Revision Score Change: -6.9 points


🇯🇵 JAPAN • Results & Revisions 09/​​​​​11 - CRE, Ya-Man, JM, Halows, Tanseisha

Japan

HEROZ, Inc. develops artificial intelligence (AI) technology. The Company focuses on planning, development, and operations of intellectual games for smart phones. HEROZ provides its services throughout Japan.

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Heroz Inc (4382 JP)

Heroz (4382 JP) - Growing Evidence of Positive Transformation

Strong execution on multiple fronts – Q1-2 FY4/2024 results were ahead of expectations, with sales growth of 205.2% YoY and operating profit growth...

Astris Advisory Japan

Heroz (4382) - Tailoring Business Growth Opportunities

HEROZ is an AI technology company that provides advanced AI development expertise to both B2C and B2B sectors. With a strategic focus on AI SaaS,...

Astris Advisory Japan

JPX-Nikkei 400 2022 Rebal: Final Predictions

I have segmented the JPX Nikkei 400 Potential ADDs and DELs based on conviction levels. The high-conviction ADDs might outperform the high...

Janaghan Jeyakumar, CFA

🇯🇵 JAPAN • Results & Revisions 09/11 - CRE, Ya-Man, JM, Halows, Tanseisha

• BEST & WORST • DAILY STATS PERCENTAGES -53% of quarterly results, 53% of annual forecasts/revisions and only 29% of interim forecasts...

Campbell Gunn

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Heroz (4382 JP) - Growing Evidence of Positive Transformation

Strong execution on multiple fronts – Q1-2 FY4/2024 results were ahead of expectations, with sales growth of 205.2% YoY and operating profit growth...

Astris Advisory Japan

Heroz (4382) - Tailoring Business Growth Opportunities

HEROZ is an AI technology company that provides advanced AI development expertise to both B2C and B2B sectors. With a strategic focus on AI SaaS,...

Astris Advisory Japan

JPX-Nikkei 400 2022 Rebal: Final Predictions

I have segmented the JPX Nikkei 400 Potential ADDs and DELs based on conviction levels. The high-conviction ADDs might outperform the high...

Janaghan Jeyakumar, CFA

🇯🇵 JAPAN • Results & Revisions 09/​​​​​11 - CRE, Ya-Man, JM, Halows, Tanseisha

• BEST & WORST • DAILY STATS PERCENTAGES -53% of quarterly results, 53% of annual forecasts/revisions and only 29% of interim forecasts...

Campbell Gunn

🇯🇵 JAPAN • Results & Revisions 09/11 - CRE, Ya-Man, JM, Halows, Tanseisha