Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

NTT (Nippon Telegraph & Telephone) / Event-Driven

<ul>
<li>The TSE Free Float Weight Rebalance to be executed at the close Monday (30 May) is about ¥729bn a side, so it will add ~¥1.5trln to volumes. </li>
<li>A sector-neutral basket of the 98 top upweights and 98 top downweights across the 33 TOPIX sectors saw the upweights UNDER-perform the downweights by about 0.3% since the April rebalance.</li>
<li>Monday again sees very large buy and sell flows at the close. This is a guide to taking advantage of those flows. Sector tables and a spreadsheet is attached.</li>
</ul>


The TSE Free Float Weight Rebalance to be executed at the close Monday (30 May) is about ¥729bn a side, so it will add ~¥1.5trln to volumes. 
A sector-neutral basket of the 98 top upweights and 98 top downweights across the 33 TOPIX sectors saw the upweights UNDER-perform the downweights by about 0.3% since the April rebalance.
Monday again sees very large buy and sell flows at the close. This is a guide to taking advantage of those flows. Sector tables and a spreadsheet is attached.


TOPIX May Rebalance - The BIG Flows at the Close MONDAY

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>Hoya’s 4Q beat slightly with revenue beating consensus by 2.2% and PBT beating by 7.0%. </li>
<li>Those beats were better than peers such as Advantest and Lasertec and qualitative guidance suggests that YoY growth is likely driven by the Lifecare segment in particular. </li>
<li>That contrasts with our negative outlook for peer momentum and we expect Hoya’s recent underperformance to reverse in short order.</li>
</ul>


Hoya’s 4Q beat slightly with revenue beating consensus by 2.2% and PBT beating by 7.0%. 
Those beats were better than peers such as Advantest and Lasertec and qualitative guidance suggests that YoY growth is likely driven by the Lifecare segment in particular. 
That contrasts with our negative outlook for peer momentum and we expect Hoya’s recent underperformance to reverse in short order.


Hoya – Getting Towards Genuinely Bullish Levels of Cheapness

<ul>
<li>A Nikkei article overnight displays the first buds of "spring" around Toshiba management's tilt towards trying to get shareholders what they want after the Separation Plan failed at the EGM.</li>
<li>The article doesn't say much, but it is a sign the Toshiba Board are not "lying flat."</li>
<li>However it doesn't mean a deal is coming much less anywhere near doable. This is a long road. But it encourages more proactive portfolio resconstruction. </li>
</ul>


A Nikkei article overnight displays the first buds of "spring" around Toshiba management's tilt towards trying to get shareholders what they want after the Separation Plan failed at the EGM.
The article doesn't say much, but it is a sign the Toshiba Board are not "lying flat."
However it doesn't mean a deal is coming much less anywhere near doable. This is a long road. But it encourages more proactive portfolio resconstruction. 


First News of Toshiba "Studying a Privatisation Plan"

<ul>
<li>The Nikkei is now down 9.57% vs. when we first recommended our skew trade (now up 0.40%). </li>
<li>Despite some frustrating idiosyncratic moves which have prevented the skew trade from outperforming more it has mostly held up. </li>
<li>Looking forward, we believe it is worthwhile assessing upside and downside macro risks for the components of the trade.</li>
</ul>


The Nikkei is now down 9.57% vs. when we first recommended our skew trade (now up 0.40%). 
Despite some frustrating idiosyncratic moves which have prevented the skew trade from outperforming more it has mostly held up. 
Looking forward, we believe it is worthwhile assessing upside and downside macro risks for the components of the trade.


TOPIX-Nikkei Skew Trade – Updates Factoring in Ukraine

<ul>
<li>We spoke to Hoya today to understand market trends in both the semi and healthcare areas. </li>
<li>Overall, business conditions remain strong although momentum appears stronger for the Life Care segment. </li>
<li>More pertinently, we interpret some of the commentary on the semi capex side as suggesting some downside risk to overall spend.</li>
</ul>


We spoke to Hoya today to understand market trends in both the semi and healthcare areas. 
Overall, business conditions remain strong although momentum appears stronger for the Life Care segment. 
More pertinently, we interpret some of the commentary on the semi capex side as suggesting some downside risk to overall spend.


Hoya – We Are Increasingly Confident About a Semi Capex Decline

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.

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Hoya Corp (7741 JP)

TOPIX May Rebalance - The BIG Flows at the Close MONDAY

The TOPIX Rebalance at end-May is upon us. ¥700+bn of buys and ¥700bn of sell flows at the close today (Friday). The big buys are NTT, Sony,...

Travis Lundy

Hoya – Getting Towards Genuinely Bullish Levels of Cheapness

We continue to have confidence in Hoya's revenue momentum and compressing valuations are starting to turn us genuinely bullish.

Mio Kato

First News of Toshiba "Studying a Privatisation Plan"

The Toshiba EGM saw the Board's Separation Plan fail to receive approval yesterday. Something like 12 hours later and the Nikkei has an article...

Travis Lundy

TOPIX-Nikkei Skew Trade – Updates Factoring in Ukraine

The Nikkei is down 9.57% vs. when we initiated our skew trade (now up 0.40%). Despite some frustrating idiosyncratic moves the trade has mostly...

Mio Kato

Hoya – We Are Increasingly Confident About a Semi Capex Decline

We spoke to Hoya today to understand market trends in both the semi and healthcare areas. We interpret some of the commentary on the semi capex...

Mio Kato

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