Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Keisei Electric Railway Co / Event-Driven

<ul>
<li>13mos ago, activist investor Palliser Capital spoke at a conference about the value offered by <a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> due to its large stake in Oriental Land (4661). </li>
<li>Keisei outperformed OLC by 30% over 3.5mos. Then it fell all the way back, and more, over the next five months. Asset sale, buyback, AGM proposals. Meh. </li>
<li>Nov 25th, Toyo Keizai <a href="https://toyokeizai.net/articles/-/842158" target="_blank" rel="noopener">wrote</a> activist Murakami-san had acquired stakes of &lt;5% in <a href="https://www.smartkarma.com/entities/keikyu-corp" target="_blank" data-smartkarma-citation="entities:3371:1" rel="noopener">Keikyu Corp (9006 JP)</a> and &lt;1% in <a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a>. Shares in both jumped.</li>
</ul>


13mos ago, activist investor Palliser Capital spoke at a conference about the value offered by Keisei Electric Railway Co (9009 JP) due to its large stake in Oriental Land (4661). 
Keisei outperformed OLC by 30% over 3.5mos. Then it fell all the way back, and more, over the next five months. Asset sale, buyback, AGM proposals. Meh. 
Nov 25th, Toyo Keizai wrote activist Murakami-san had acquired stakes of &lt;5% in Keikyu Corp (9006 JP) and &lt;1% in Keisei Electric Railway Co (9009 JP). Shares in both jumped.


[JAPAN ACTIVISM] Keisei Elec (9009) - Murakami Stake Causes Pop But the Oppty Is Still Unconvincing

Equity Analyst, LightStream Research

Oshadhi Kumarasiri

Equity Analyst

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.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> rose 14% after reports that a fund linked to activist investor Murakami bought a stake, while Oriental Land also gained 2.9% in a volatile market.</li>
<li>Down 50% since February 2024, Keisei Electric seems to have limited downside risks. We believe its valuation could increase if Murakami’s stake leads to activism.</li>
<li>The long Keisei Electric, short <a href="https://www.smartkarma.com/entities/oriental-land-co-ltd" target="_blank" data-smartkarma-citation="entities:13517:1" rel="noopener">Oriental Land (4661 JP)</a> trade could work well too, especially if Murakami’s activism and the risks to Oriental Land’s guidance materialize.</li>
</ul>



Keisei Electric Railway Co (9009 JP) rose 14% after reports that a fund linked to activist investor Murakami bought a stake, while Oriental Land also gained 2.9% in a volatile market.
Down 50% since February 2024, Keisei Electric seems to have limited downside risks. We believe its valuation could increase if Murakami’s stake leads to activism.
The long Keisei Electric, short Oriental Land (4661 JP) trade could work well too, especially if Murakami’s activism and the risks to Oriental Land’s guidance materialize.


Keisei Electric Jumps 14% on Reports of Murakami Stake

Japanese Turnaround Situations, Short-Ideas, Azabu Research

Michael Allen

Japanese Turnaround Situations, Short-Ideas

Azabu Research

Azabu Research is a publishing and consulting firm focused on distressed equities in the Japanese market. We specialize in turnaround strategies, corporate combinations, divestitures, and restructuring.

Publisher of the Tokyo Turnaround Letter, which conducts the most thorough research possible of publicly available information, including forensic tests for fraudulent overstatement of assets and understatement of liabilities, as well as rigorous market and industry analysis to assess the underlying strengths of the company’s products or services, the appropriateness of the company’s turnaround strategy, and the skill of its current management team. The average length of a report exceeds 25 pages of text and tables, excluding any disclosures or executive summaries.

We have more than 30 years of experience in applying this process to distressed equities in Japan. Additionally, subscribers have free access to detailed, yet easily navigated earnings models for the target company as well as the top five comparable companies, and unlimited access to the analyst for follow-up questions.

Azabu Research also conducts be-spoke research on a project basis, and provides consulting services to companies looking to restructure, divest, make acquisitions, go public, or improve investor sentiment toward their stock.

Independent Research and Consulting Firm

Equity Bottom-Up

<ul>
<li>2025 will start with more attractive turnaround opportunities than we have seen in a long time. </li>
<li>An uptick in TOBs, MBOs and merger discussions makes it suddenly no longer safe to short low-PBR companies indiscriminately.</li>
<li>Investors are noticing. More than two-dozen large- and medium-cap stocks with deep discounts to the benchmark began to bounce off well-defined support levels in late December.</li>
</ul>


2025 will start with more attractive turnaround opportunities than we have seen in a long time. 
An uptick in TOBs, MBOs and merger discussions makes it suddenly no longer safe to short low-PBR companies indiscriminately.
Investors are noticing. More than two-dozen large- and medium-cap stocks with deep discounts to the benchmark began to bounce off well-defined support levels in late December.


Unloved Japan Round Up Jan. 3: Set Up for A Banner Year?

<ul>
<li>Over two decades, <a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> has been the subject of softer and harder activist efforts to have Keisei monetise its stake in affiliate Oriental Land (4661).</li>
<li>The most recent efforts were by Palliser last fall, briefly discussed <a href="https://www.smartkarma.com/insights/keisei-electric-rail-9009-a-buyback-but-it-s-likely-to-be-crossholders-selling-in-tostnet-3" target="_blank" rel="noopener">here</a> two weeks ago when Keisei announced a buyback. </li>
<li>Today, Keisei <a href="https://contents.xj-storage.jp/xcontents/AS01810/961e9d0f/2b7a/4eef/89ba/091c3bf36d72/140120240305549065.pdf" target="_blank" rel="noopener">announced</a> (Japanese only) an Accelerated Block Offering of 1% of Oriental Land shares. The accompanying announcement is worth reading. It's pretty clear.</li>
</ul>


Over two decades, Keisei Electric Railway Co (9009 JP) has been the subject of softer and harder activist efforts to have Keisei monetise its stake in affiliate Oriental Land (4661).
The most recent efforts were by Palliser last fall, briefly discussed here two weeks ago when Keisei announced a buyback. 
Today, Keisei announced (Japanese only) an Accelerated Block Offering of 1% of Oriental Land shares. The accompanying announcement is worth reading. It's pretty clear.


Oriental Land (4661) Placement by Keisei Rail (9009) Says "That's the Door"

<ul>
<li>A week ago, the <a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> AGM took place. The activist which had proposed a shareholder resolution saw ISS and Glass Lewis support.</li>
<li>But that was to no avail as the shareholder proposal got 29.89% of the votes, and 26.15% of total voting rights. This likely informs the near-term future of such proposals.</li>
<li>I expect the ask needs to change, and the agenda item needs to be difficult to be against. </li>
</ul>


A week ago, the Keisei Electric Railway Co (9009 JP) AGM took place. The activist which had proposed a shareholder resolution saw ISS and Glass Lewis support.
But that was to no avail as the shareholder proposal got 29.89% of the votes, and 26.15% of total voting rights. This likely informs the near-term future of such proposals.
I expect the ask needs to change, and the agenda item needs to be difficult to be against. 


[JAPAN ACTIVISM] Keisei Elec (9009) AGM Result Not Salutary, Tough To Win On This Stance

Japan

Keisei Electric Railway Co., Ltd. provides passenger rail and bus transportation services in the Metropolitan Tokyo and Chiba prefecture areas.  The Company operates department and supermarket stores, hotels, travel agents, movie theater and restaurants, and sells, leases, and maintains real estate.  Keisei Electric is a shareholder of Oriental Land Co., Ltd. which operates Tokyo Disneyland.

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Keisei Electric Railway Co (9009 JP)

[JAPAN ACTIVISM] Keisei Elec (9009) - Murakami Stake Causes Pop But the Oppty Is Still Unconvincing

Toyo Keizai put out an article on Keisei based on a quote from a "market insider". Keisei shares popped 16% in 2 days. There's value, but less than...

Travis Lundy

Keisei Electric Jumps 14% on Reports of Murakami Stake

Activist investor Murakami's stake in Keisei Electric Railway leads to a 14% rise in share price, with potential for multiples to expand due to...

Oshadhi Kumarasiri

Unloved Japan Round Up Jan. 3: Set Up for A Banner Year?

An uptick in TOBs, MBOs, and mergers creating the best environment for deep value turnarounds in a long time. Dozens of discounted stocks started...

Michael Allen

Oriental Land (4661) Placement by Keisei Rail (9009) Says "That's the Door"

Keisei Rail today announced the offering/sale of 16+mm shares (1.0%) of Oriental Land. There will be a special div as a result. The announcement...

Travis Lundy

[JAPAN ACTIVISM] Keisei Elec (9009) AGM Result Not Salutary, Tough To Win On This Stance

Keisei has underperformed OLC by 12% since the day AFTER I wrote this piece. It has underperformed by 30+% since Feb highs. Keisei is down 35%...

Travis Lundy

Price Gauge

52-week Range

Market Cap (USDm)

P/E

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[JAPAN ACTIVISM] Keisei Elec (9009) - Murakami Stake Causes Pop But the Oppty Is Still Unconvincing

Toyo Keizai put out an article on Keisei based on a quote from a "market insider". Keisei shares popped 16% in 2 days. There's value, but less than...

Travis Lundy

Keisei Electric Jumps 14% on Reports of Murakami Stake

​Activist investor Murakami's stake in Keisei Electric Railway leads to a 14% rise in share price, with potential for multiples to expand due to...

Oshadhi Kumarasiri

Unloved Japan Round Up Jan. 3: Set Up for A Banner Year?

An uptick in TOBs, MBOs, and mergers​ creating the best environment for deep value turnarounds in a long time. Dozens of discounted stocks started...

Michael Allen

Oriental Land (4661) Placement by Keisei Rail (9009) Says "That's the Door"

Keisei Rail today announced the offering/sale of 16+mm shares (1.0%) of Oriental Land. There will be a special div as a result. The announcement...

Travis Lundy

[JAPAN ACTIVISM] Keisei Elec (9009) AGM Result Not Salutary, Tough To Win On This Stance

Keisei has underperformed OLC by 12% since the day AFTER I wrote this piece. It has underperformed by 30+% since Feb highs. Keisei is down 35%...

Travis Lundy

Activist investor Murakami's stake in Keisei Electric Railway leads to a 14% rise in share price, with potential for multiples to expand due to...

An uptick in TOBs, MBOs, and mergers creating the best environment for deep value turnarounds in a long time. Dozens of discounted stocks started...