Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>OVERSEAS.  Strong close to Month, Quarter and Half Year as SPX rose +1.2% on Friday; AI Trade Back as NDX100 hit  $5trn Mkt cap; Apple now &gt;$3 trill !</li>
<li>JAPAN. NKY Futs +0.7% vs Cash; USDJPY 144.3; Tokyo Inflation print 3.2% raises questions on national inflation and BOJ's next steps;  Tokyo heats up as Power conservation measures implemented</li>
<li>NUGGET.  We believe Toyota's concerns regarding BEVs are valid. We see them having the technology and manufacturing prowess at scale, strong branding, and global reach to eventually overtake Tesla</li>
</ul>


OVERSEAS.  Strong close to Month, Quarter and Half Year as SPX rose +1.2% on Friday; AI Trade Back as NDX100 hit  $5trn Mkt cap; Apple now &gt;$3 trill !
JAPAN. NKY Futs +0.7% vs Cash; USDJPY 144.3; Tokyo Inflation print 3.2% raises questions on national inflation and BOJ's next steps;  Tokyo heats up as Power conservation measures implemented
NUGGET.  We believe Toyota's concerns regarding BEVs are valid. We see them having the technology and manufacturing prowess at scale, strong branding, and global reach to eventually overtake Tesla


Ohayo Japan | Bull Mkt - Nasdaq 100 Stunning +39%YTD ! NUGGET: Toyota(7203) BEV Strategy - A Defense

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. 

<ul>
<li>Inflation remains the biggest headwind but most retail formats will see growth in 2023 with e-commerce expected to become the largest channel in the next 18 months.</li>
<li>Supermarkets are ripe for consolidation as new competitors emerge from the discount sector and online while convenience stores will consolidate further in a saturated sector.</li>
<li>Department stores will rebound further but only the leading firms will survive in a contracting sector.</li>
</ul>


Inflation remains the biggest headwind but most retail formats will see growth in 2023 with e-commerce expected to become the largest channel in the next 18 months.
Supermarkets are ripe for consolidation as new competitors emerge from the discount sector and online while convenience stores will consolidate further in a saturated sector.
Department stores will rebound further but only the leading firms will survive in a contracting sector.


<ul>
<li>With energy costs still rising and ongoing supply-chain issues exacerbated by the re-emergence of Covid problems in China, Japanese consumers suddenly face the prospect of genuine price inflation.</li>
<li>How will they respond? Some retailers are trying to resist higher prices at the expense of profits and others have no choice but to raise prices.</li>
<li>We look at the wholesale, retail and consumer response to inflation and which retailers stand to benefit or lose from inflation.</li>
</ul>


With energy costs still rising and ongoing supply-chain issues exacerbated by the re-emergence of Covid problems in China, Japanese consumers suddenly face the prospect of genuine price inflation.
How will they respond? Some retailers are trying to resist higher prices at the expense of profits and others have no choice but to raise prices.
We look at the wholesale, retail and consumer response to inflation and which retailers stand to benefit or lose from inflation.


Widespread Price Rises at Japanese Retail and Wholesale

Equity Bottom-Up

There are few discount supermarkets in Japan and the largest by far is Kobe Bussan’s Gyomu Super franchise chain.
Despite its no frills presentation and reliance on frozen foods, over the past 12 months, prices that are up to half that charged at mainstream chains have drawn in more customers and across a wider age range.
The company is now expecting yet another record performance this year.
When we first recommend Kobe Bussan in October 2018, the share price stood at around ¥780 and has risen to ¥4,080 since. This isn't cheap but given the five year growth potential, we remain bullish about the fundamentals long-term.

There are few discount supermarkets in Japan and the largest by far is Kobe Bussan’s Gyomu Super franchise chain.
Despite its no frills presentation and reliance on frozen foods, over the past 12 months, prices that are up to half that charged at mainstream chains have drawn in more customers and across a wider age range.
The company is now expecting yet another record performance this year.
When we first recommend Kobe Bussan in October 2018, the share price stood at around ¥780 and has risen to ¥4,080 since. This isn't cheap but given the five year growth potential, we remain bullish about the fundamentals long-term.

Executive Director, Metrical Inc

Aki Matsumoto

Executive Director

Independent Leading Corporate Governance Research

Metrical Inc

METRICAL INC. is an independent leading Corporate Governance research firm in Japan where Corporate Governance is increasingly recognized as an important element on corporate management in these days. Thus, CG research and solutions would become an essential component of global capital markets and play important to contribute to transparency of the markets and maximize shareholders’ value in Japan. 

METRICAL INC. provides Corporate Governance research and analysis including rating services, and  also offers investment research and IR services with solutions and customized profound research on CG and IR issues.

On Wednesday, July 7, I attended the analyst meeting for the FY5/2021 financial repirting of Kusuri No Aoki (3549). The drugstore industry is still growing in this country, and according to data from the Japan Association of Chain Drug Stores (JACDS), the industry increased from 5,631 billion yen in 2010 to 8,036 billion yen in 2020 and is expected to grow to 100,000 billion yen in 2025. On the other hand, competition in this industry is becoming increasingly fierce. The number of stores has increased from 16,259 in 2010 to 21,284 in 2020, and the trade area population (people/store) has decreased from 7,846 to 5,890. It is expected that the trade area population will continue to decrease, and competition will become more intense. Considering this environment, Aoki released its current medium-term management plan.

On Wednesday, July 7, I attended the analyst meeting for the FY5/2021 financial repirting of Kusuri No Aoki (3549). The drugstore industry is still growing in this country, and according to data from the Japan Association of Chain Drug Stores (JACDS), the industry increased from 5,631 billion yen in 2010 to 8,036 billion yen in 2020 and is expected to grow to 100,000 billion yen in 2025. On the other hand, competition in this industry is becoming increasingly fierce. The number of stores has increased from 16,259 in 2010 to 21,284 in 2020, and the trade area population (people/store) has decreased from 7,846 to 5,890. It is expected that the trade area population will continue to decrease, and competition will become more intense. Considering this environment, Aoki released its current medium-term management plan.

Japan's Governance: Unclear Medium-Term Management Plan - Kusuri No Aoki (3549)

Japan

Kusuri no Aoki Holdings Co., Ltd. operates as a holding company. The Company, through its subsidiaries, provides medicines, cosmetics, health foods, beauty care, and household products. Kusuri no Aoki Holdings serves customers in Japan.

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

Kusuri no Aoki Holdings (3549 JP)

Ohayo Japan | Bull Mkt - Nasdaq 100 Stunning +39%YTD ! NUGGET: Toyota(7203) BEV Strategy - A Defense

Strong US Close despite the spectre of inflation/Fed hikes; NKY Futs +0.7% vs Cash; USDJPY 144.3; Tokyo May Inflation print 3.2% - BOJ's next...

Mark Chadwick

Outlook for Japanese Retail in 2023

Most Japanese retailers can look forward to a good year in 2023 but there will be challenges for formats like supermarkets where consolidation is...

Michael Causton

Widespread Price Rises at Japanese Retail and Wholesale

Japan is finally getting inflation after a decade of government failed efforts. We examine the wholesale, retail and consumer response to evaluate...

Michael Causton

Kobe Bussan: Achieving New Records

Japan's discount food market is booming. The biggest discount supermarket operator is Kobe Bussan. The share price has around 6-fold since we first...

Michael Causton

Japan's Governance: Unclear Medium-Term Management Plan - Kusuri No Aoki (3549)

The environment surrounding the drug store chain, which failed to come up with a clear outlook and strategy in its mid-term management plan, would...

Metrical Inc

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)