Expert on Japan Retail and Consumer Markets, JapanConsuming

Michael Causton

Expert on Japan Retail and Consumer Markets

Real Insight on Japanese Consumer Markets

JapanConsuming

JapanConsuming is a specialist research firm producing intelligence on Japanese retail and consumer markets. Founded in 2000, JapanConsuming has become the leading provider of insights on Japanese retailers and consumer trends to retailers, brands, government agencies and investors. As well as a highly regarded monthly report on the market, JapanConsuming produces in-depth reports on retail sectors, seminars on key trends and telephone consulting to investors on trends and retailers.

JapanConsuming was founded by Michael Causton and Roy Larke. 

Thematic (Sector/Industry)

<ul>
<li>The following is an in-depth review of the Japanese retail sector in 2021-22 and is designed to provide a complete overview for any investor in Japanese retail/consumer markets.</li>
<li>FY2021-22 proved a rebound year for retailers at the sector level. But on a company by company basis, there has been radical divergence between the best and the rest. </li>
<li>We look at the reasons for this divergence and the implications for Japanese retail and consumer firms in the years ahead.</li>
</ul>


The following is an in-depth review of the Japanese retail sector in 2021-22 and is designed to provide a complete overview for any investor in Japanese retail/consumer markets.
FY2021-22 proved a rebound year for retailers at the sector level. But on a company by company basis, there has been radical divergence between the best and the rest. 
We look at the reasons for this divergence and the implications for Japanese retail and consumer firms in the years ahead.


Japanese Retailing 2021-22: What's Really Going on and What's Next?

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

TSE Tokyo Price Index TOPIX / Event-Driven

<ul>
<li>The TSE and Government are pressuring low-PBR companies to DO SOMETHING to raise their PBR to &gt;1.0x. The easiest way to do that is raise ROE.</li>
<li>Raising R requires customers "agree" (buying more, paying a higher price, etc). Lowering E means buying back shares or paying big special dividends. That's easier for a company.</li>
<li>So buybacks have been increasing in number, and breadth, and to some degree in size. This insight describes the mechanics/details of how buybacks work in Japan.</li>
</ul>


The TSE and Government are pressuring low-PBR companies to DO SOMETHING to raise their PBR to &gt;1.0x. The easiest way to do that is raise ROE.
Raising R requires customers "agree" (buying more, paying a higher price, etc). Lowering E means buying back shares or paying big special dividends. That's easier for a company.
So buybacks have been increasing in number, and breadth, and to some degree in size. This insight describes the mechanics/details of how buybacks work in Japan.


<ul>
<li>Shopping malls are now trading at pre-pandemic levels again and developers and tenants alike are much more upbeat and optimistic about the future. </li>
<li>The pandemic, alongside competition from e-commerce, has left its mark but this has mostly been a good thing, forcing more proactive management of malls.</li>
<li>Profitability remains a concern but rents are up for some and more efficiencies are being introduced through digitisation.</li>
</ul>


Shopping malls are now trading at pre-pandemic levels again and developers and tenants alike are much more upbeat and optimistic about the future. 
The pandemic, alongside competition from e-commerce, has left its mark but this has mostly been a good thing, forcing more proactive management of malls.
Profitability remains a concern but rents are up for some and more efficiencies are being introduced through digitisation.


Japan Shopping Malls: More Proactive and Disciplined Post-Covid

<ul>
<li>Back on 30 October, <a href="https://www.smartkarma.com/entities/daito-trust-construct-co-ltd" target="_blank" data-smartkarma-citation="entities:10503:1" rel="noopener">Daito Trust Construct (1878 JP)</a> announced a large earnings, a new Shareholder Return policy, a higher payout this year, and a big buyback. </li>
<li>It said the buyback period would start two days later, but they did not specify the method (<a href="https://www.smartkarma.com/insights/daito-trust-construction-1878-big-buyback-dense-register-120-payout-this-year" target="_blank" data-smartkarma-citation="insights:116772" rel="noopener">Daito Trust Construction (1878) - Big Buyback, Dense Register, 120% Payout This Year</a> </li>
<li>Today they announced a ToSTNeT-3 purchase for "the whole size", which is accompanied by a "Japan-style ASR." Know your details.</li>
</ul>


Back on 30 October, Daito Trust Construct (1878 JP) announced a large earnings, a new Shareholder Return policy, a higher payout this year, and a big buyback. 
It said the buyback period would start two days later, but they did not specify the method (Daito Trust Construction (1878) - Big Buyback, Dense Register, 120% Payout This Year 
Today they announced a ToSTNeT-3 purchase for "the whole size", which is accompanied by a "Japan-style ASR." Know your details.


Daito Trust (1878) Doing a ToSTNeT Buyback Which Is NOT a ToSTNeT Buyback...  Unless It Is.

<ul>
<li>Last year, I wrote about <a href="https://www.smartkarma.com/entities/joyful-honda-co-ltd" target="_blank" data-smartkarma-citation="entities:13616:1" rel="noopener">Joyful Honda (3191 JP)</a>'s implementation of a ¥2.5bn ToSTNeT-3 into Accelerated Share Repurchase. It was the first such transaction I knew of in Japan.</li>
<li>This year, they have just announced another for nearly twice the size. It is worth looking at the details and comparing the stock vs Peers.</li>
<li>It is also worth understanding exactly what the incentives are for whom and how that impacts the path. And who might respond to it.</li>
</ul>


Last year, I wrote about Joyful Honda (3191 JP)'s implementation of a ¥2.5bn ToSTNeT-3 into Accelerated Share Repurchase. It was the first such transaction I knew of in Japan.
This year, they have just announced another for nearly twice the size. It is worth looking at the details and comparing the stock vs Peers.
It is also worth understanding exactly what the incentives are for whom and how that impacts the path. And who might respond to it.


Joyful Honda (3191) - Repeats Its ASR In Double the Size

Japan

Joyful Honda Co.,Ltd. operates home improvement center business. The company sells products such as hardware, garden, pet products and also household utensil s.

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Joyful Honda (3191 JP)

Japanese Retailing 2021-22: What's Really Going on and What's Next?

There is increasing divergence between the winners and losers in Japanese retailing and the following in-depth review looks at performance in the...

Michael Causton

Japan Shopping Malls: More Proactive and Disciplined Post-Covid

Shopping malls rebound to pre-pandemic levels, prompting optimism for the future as better management drives efficiency. This is an in-depth...

Michael Causton

Daito Trust (1878) Doing a ToSTNeT Buyback Which Is NOT a ToSTNeT Buyback... Unless It Is.

Daito Trust announced earnings, a higher payout, a plan to return cash, and a big buyback two weeks ago. It did not specify method. Now we know....

Travis Lundy

Joyful Honda (3191) - Repeats Its ASR In Double the Size

Joyful Honda is conducting another ASR-style buyback. It is worthwhile looking at what happened last time vs Peers, and understanding incentives...

Travis Lundy

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Japanese Retailing 2021-22: What's Really Going on and What's Next?

There is increasing divergence between the winners and losers in Japanese retailing and the following in-depth review looks at performance in the...

Michael Causton

Share Buybacks In Japan - A 2023 Primer

This is a primer of Share Buybacks - types and processes - in Japan. As the TSE and Govt try to get PBRs up, it is worth understanding how...

Travis Lundy

Japan Shopping Malls: More Proactive and Disciplined Post-Covid

​Shopping malls rebound to pre-pandemic levels, prompting optimism for the future as better management drives efficiency. This is an in-depth...

Michael Causton

Daito Trust (1878) Doing a ToSTNeT Buyback Which Is NOT a ToSTNeT Buyback... Unless It Is.

Daito Trust announced earnings, a higher payout, a plan to return cash, and a big buyback two weeks ago. It did not specify method. Now we know....

Travis Lundy

Joyful Honda (3191) - Repeats Its ASR In Double the Size

Joyful Honda is conducting another ASR-style buyback. It is worthwhile looking at what happened last time vs Peers, and understanding incentives...

Travis Lundy

Shopping malls rebound to pre-pandemic levels, prompting optimism for the future as better management drives efficiency. This is an in-depth...