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>In 2020 and 2021 we had nine conviction calls, four of which returned over 50% within just over a year.</li>
<li>Three more returned close to 40%, one returned 15% and just one was an abject failure returning -39%. </li>
<li>On average, alpha generation was 24.3% and our 2022 names are off to a good start putting up 14.7% in alpha in just over a month and a half.</li>
</ul>


In 2020 and 2021 we had nine conviction calls, four of which returned over 50% within just over a year.
Three more returned close to 40%, one returned 15% and just one was an abject failure returning -39%. 
On average, alpha generation was 24.3% and our 2022 names are off to a good start putting up 14.7% in alpha in just over a month and a half.


A Belated Look Back at Our 2020 and 2021 Conviction Calls and a Look Ahead to 2022

Global Healthcare Analyst

Tina Banerjee

<p><a href="https://www.smartkarma.com/entities/olympus-corp" target="_blank" data-smartkarma-citation="entities:356:1" rel="noopener">Olympus Corp (7733 JP)</a> is the global market leader in gastrointestinal endoscopic equipment, with 70%+ share. Global GI endoscopic equipment market is expected to have a CAGR of 4–6% during FY21–24. Olympus is expected to outpace the market due to its dominant positioning in Asia market and superior imaging technologies. The company is one of the early entrants in fast growing Asia markets among its peers. Consequently, Olympus witnessed 4.2x jump in medical business revenue from China in the last decade. Last year, Olympus has launched its most advanced endoscopy system to date, EVIS X1, the first new model in about eight years (vs usual product life cycle of 5–6 years). The company estimates 70,000 units potential only for replacing the previous models by EVIS X1. Olympus is transforming itself to become a pure-play global medical devices company and conducted several M&amp;A to augment its medium-term growth. Its medical business is now back to pre-pandemic level. Concerns regarding China business seems to be over and Olympus shares are trading near its highs. Despite some risk due to global semiconductor shortage, we are bullish on the growth potential of the company’s medical business due to ongoing recovery in elective procedures and new product launch. </p>

Olympus Corp (7733 JP) is the global market leader in gastrointestinal endoscopic equipment, with 70%+ share. Global GI endoscopic equipment market is expected to have a CAGR of 4–6% during FY21–24. Olympus is expected to outpace the market due to its dominant positioning in Asia market and superior imaging technologies. The company is one of the early entrants in fast growing Asia markets among its peers. Consequently, Olympus witnessed 4.2x jump in medical business revenue from China in the last decade. Last year, Olympus has launched its most advanced endoscopy system to date, EVIS X1, the first new model in about eight years (vs usual product life cycle of 5–6 years). The company estimates 70,000 units potential only for replacing the previous models by EVIS X1. Olympus is transforming itself to become a pure-play global medical devices company and conducted several M&amp;A to augment its medium-term growth. Its medical business is now back to pre-pandemic level. Concerns regarding China business seems to be over and Olympus shares are trading near its highs. Despite some risk due to global semiconductor shortage, we are bullish on the growth potential of the company’s medical business due to ongoing recovery in elective procedures and new product launch. 

Olympus (7733 JP): Medical Business Is on a Strong Foothold; Buy at Current Level

Ortus Advisors

Andrew Jackson

Independent Insight Provider

Thematic (Sector/Industry)

<ul>
<li>Tech selloff overnight on NVDA post-earnings weakness was fairly contained, and SPE related in Japan should continue yesterdays rebound off the morning lows.</li>
<li>Big beat for Dell on the strong outlook for its AI servers outweighing the soft consumer PC market sending it +8% in after-market trading.</li>
<li>News that Tepco plans to spend $3.2bn to upgrade its electricity infrastructure to 2030 positive for wire/cable names and related names.</li>
</ul>


Tech selloff overnight on NVDA post-earnings weakness was fairly contained, and SPE related in Japan should continue yesterdays rebound off the morning lows.
Big beat for Dell on the strong outlook for its AI servers outweighing the soft consumer PC market sending it +8% in after-market trading.
News that Tepco plans to spend $3.2bn to upgrade its electricity infrastructure to 2030 positive for wire/cable names and related names.


Japan Morning Connection: Tech Set to Rebound as Dell After-Market Print Sets Positive Tone

Chief Economist & Political Strategist, CrossASEAN Research

Prasenjit K. Basu

Chief Economist & Political Strategist

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Cross Asset Strategy

<ul>
<li>With nominal GDP growing 6%YoY in the latest 3 quarters, Japanese interest rates will be gradually normalized. The JPY rebound, however, precludes the need for rapid BoJ hikes. </li>
<li>Unwinding of Yen carry-trades should take JPY to ¥125/US$ by end-2024, which will contribute to tightening monetary conditions sufficiently, further slowing inflation (from 2.85%YoY in May-Jun'24). </li>
<li>Appreciating JPY is bad for Japanese equities, so stay Underweight, with a defensive portfolio comprising utilities, pharmaceuticals and consumer staples. </li>
</ul>


With nominal GDP growing 6%YoY in the latest 3 quarters, Japanese interest rates will be gradually normalized. The JPY rebound, however, precludes the need for rapid BoJ hikes. 
Unwinding of Yen carry-trades should take JPY to ¥125/US$ by end-2024, which will contribute to tightening monetary conditions sufficiently, further slowing inflation (from 2.85%YoY in May-Jun'24). 
Appreciating JPY is bad for Japanese equities, so stay Underweight, with a defensive portfolio comprising utilities, pharmaceuticals and consumer staples. 


Japan: Normalizing Interest Rates as Nominal GDP Surges, Ending Deflation Era

<ul>
<li>DOW +0.59%, Russell -1.06%, SPX -1.39%, Nasdaq -2.77%, SOX -6.81% as investors shifted from growth to value stocks. UST10 was flat at 4.16%, and the yen strengthened to Y156.18.</li>
<li>Commodities were mixed with copper -0.3%, nickel -0.83%, and Brent +1.72%. Energy and consumer staples rose, with VSF +13.6% after Essilor Luxottica agreed to buy Supreme. US homebuilders lost ground. </li>
<li>Tech stocks fell sharply after ASML's earnings missed estimates and news of potential US export restrictions to China. Focus on SPE names with high China exposure as shorts.</li>
</ul>


DOW +0.59%, Russell -1.06%, SPX -1.39%, Nasdaq -2.77%, SOX -6.81% as investors shifted from growth to value stocks. UST10 was flat at 4.16%, and the yen strengthened to Y156.18.
Commodities were mixed with copper -0.3%, nickel -0.83%, and Brent +1.72%. Energy and consumer staples rose, with VSF +13.6% after Essilor Luxottica agreed to buy Supreme. US homebuilders lost ground. 
Tech stocks fell sharply after ASML's earnings missed estimates and news of potential US export restrictions to China. Focus on SPE names with high China exposure as shorts.


Japan Morning Connection – 18 July, 2024

Japan

Hoya Corp manufactures electro-optics products such as mask blanks for semiconductors, photomasks for LCD panels, optical glasses, glass memory disks for HDDs, medical flexible endoscopes, eyeglasses, and contact lenses. The Company also provides information system architecture.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Hoya Corp (7741 JP)

A Belated Look Back at Our 2020 and 2021 Conviction Calls and a Look Ahead to 2022

We take a look back at our conviction calls from 2020 and 2021 to assess performance and put the strong start to our 2022 names in context.

Mio Kato

Olympus (7733 JP): Medical Business Is on a Strong Foothold; Buy at Current Level

Olympus is well-positioned for double-digit revenue growth this fiscal driven by earlier-than-expected recovery in medical business and new product...

Tina Banerjee

Japan Morning Connection: Tech Set to Rebound as Dell After-Market Print Sets Positive Tone

Tech selloff contained, Dell beats with strong outlook for AI servers, Tepco's $3.2bn upgrade plan positive for wire/cable names.

Andrew Jackson

Japan: Normalizing Interest Rates as Nominal GDP Surges, Ending Deflation Era

Japanese interest rates are set to normalize amid robust nominal GDP. But a rebounding JPY (at ¥125/US$ by end'24) precludes further BoJ hikes,...

Prasenjit K. Basu

Japan Morning Connection – 18 July, 2024

Investors shift from growth to value stocks, tech stocks fall on ASML earnings miss and US export restrictions to China, VSF surges after Essilor...

Andrew Jackson

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

A Belated Look Back at Our 2020 and 2021 Conviction Calls and a Look Ahead to 2022

We take a look back at our conviction calls from 2020 and 2021 to assess performance and put the strong start to our 2022 names in context.

Mio Kato

Olympus (7733 JP): Medical Business Is on a Strong Foothold; Buy at Current Level

Olympus is well-positioned for double-digit revenue growth this fiscal driven by earlier-than-expected recovery in medical business and new product...

Tina Banerjee

Japan Morning Connection: Tech Set to Rebound as Dell After-Market Print Sets Positive Tone

​Tech selloff contained, Dell beats with strong outlook for AI servers, Tepco's $3.2bn upgrade plan positive for wire/cable names.

Andrew Jackson

Japan: Normalizing Interest Rates as Nominal GDP Surges, Ending Deflation Era

​Japanese interest rates are set to normalize amid robust nominal GDP. But a rebounding JPY (at ¥125/US$ by end'24) precludes further BoJ hikes,...

Prasenjit K. Basu

Japan Morning Connection – 18 July, 2024

​Investors shift from growth to value stocks, tech stocks fall on ASML earnings miss and US export restrictions to China, VSF surges after Essilor...

Andrew Jackson

Tech selloff contained, Dell beats with strong outlook for AI servers, Tepco's $3.2bn upgrade plan positive for wire/cable names.

Japanese interest rates are set to normalize amid robust nominal GDP. But a rebounding JPY (at ¥125/US$ by end'24) precludes further BoJ hikes,...

Investors shift from growth to value stocks, tech stocks fall on ASML earnings miss and US export restrictions to China, VSF surges after Essilor...