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.

<p>Mercari (4385) on June 29th, DMG Mori Seiki (6141) on June 30th, and Sosei Group (4565) on July 7th, all announced the issuance of Euro-Yen convertible bonds one after another (there are still other small issues to be announced). Although each company is in a different industry and has a different background and reason for the issuance, it can be assumed that they have started to raise funds now that the stock market has recovered significantly from last year's lows and the business environment is looking post-COVID pandemic. It is expected that the issue of convertible bonds will continue in the future as companies want to raise funds while avoiding the immediate dilution of shareholder interests by issuing new shares.</p>

Mercari (4385) on June 29th, DMG Mori Seiki (6141) on June 30th, and Sosei Group (4565) on July 7th, all announced the issuance of Euro-Yen convertible bonds one after another (there are still other small issues to be announced). Although each company is in a different industry and has a different background and reason for the issuance, it can be assumed that they have started to raise funds now that the stock market has recovered significantly from last year's lows and the business environment is looking post-COVID pandemic. It is expected that the issue of convertible bonds will continue in the future as companies want to raise funds while avoiding the immediate dilution of shareholder interests by issuing new shares.

Japan's Governance: Convertible Bonds Issue

Telco/Internet specialist

Kirk Boodry

Redex Research

Thematic (Sector/Industry)

<p>Google is reportedly close to acquiring smartphone settlements company Pring for ¥20-30bn which would open the door for it to offer a mobile payments service in Japan directly linked to bank accounts. And that is the appeal of Pring which is a relative minnow in the Japanese payments market with &lt;1mn users but has relationships with a wide range of Japanese financial institutions. Google is not a global fintech player but it has had some success in a few markets like the US and India whilst it has started to expand in Europe, and now apparently, Japan. Competitively, the major domestic players with vast consumer ecosystems are formidable competition but Google connects to half of all smartphone users through Android and has merchant relationships through its Internet advertising business.</p>

Google is reportedly close to acquiring smartphone settlements company Pring for ¥20-30bn which would open the door for it to offer a mobile payments service in Japan directly linked to bank accounts. And that is the appeal of Pring which is a relative minnow in the Japanese payments market with &lt;1mn users but has relationships with a wide range of Japanese financial institutions. Google is not a global fintech player but it has had some success in a few markets like the US and India whilst it has started to expand in Europe, and now apparently, Japan. Competitively, the major domestic players with vast consumer ecosystems are formidable competition but Google connects to half of all smartphone users through Android and has merchant relationships through its Internet advertising business.

Japan Fintech - Google Push into Mobile Payments Could Raise Competitive Intensity

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

<p>Mercari revised up its guidance for the full year to ¥4.5bn in OP and ¥106bn in sales vs. consensus at ¥1.73bn and ¥104.8bn respectively. The intensity of the move is surprising and demonstrates that the market seems to be as behind as consensus in understanding Mercari.</p>

Mercari revised up its guidance for the full year to ¥4.5bn in OP and ¥106bn in sales vs. consensus at ¥1.73bn and ¥104.8bn respectively. The intensity of the move is surprising and demonstrates that the market seems to be as behind as consensus in understanding Mercari.

Mercari – Up 10% on What Should Have Been an Unsurprising Upward Revision

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. 

<p>Having completed the transition from department store concessions, <a href="https://www.smartkarma.com/entities/marui-group-co-ltd" target="_blank" data-smartkarma-citation="entities:13604:1" rel="noopener">Marui Group (8252 JP)</a> is planning to upgrade many of its shopping buildings to become meeting places as much as shopping emporiums over the next few years but its consumer credit business will still be the main source of profits.</p>

Having completed the transition from department store concessions, Marui Group (8252 JP) is planning to upgrade many of its shopping buildings to become meeting places as much as shopping emporiums over the next few years but its consumer credit business will still be the main source of profits.

Marui to Invest ¥80 Billion over 5 Years in FinTech & Buildings

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/aihuishou" target="_blank" data-smartkarma-citation="entities:33426:1" rel="noopener">Aihuishou (RERE US)</a> (AHS), China’s largest pre-owned consumer electronics transactions and services platform, raised around US$230m via a US listing. It is backed by <a href="https://www.smartkarma.com/entities/jd-com-inc-adr" target="_blank" data-smartkarma-citation="entities:446:1" rel="noopener">JD.com Inc (ADR) (JD US)</a>, Morningside and Tiger Global.</p></div><div><p>We covered some aspects of the deal in our earlier notes:</p></div><div><ul style="list-style-type: disc;">
<li>
<a href="https://www.smartkarma.com/insights/aihuishou-pre-ipo-mostly-positive-pre-owned-but-well-loved" target="_blank" rel="noopener">AiHuiShou Pre-IPO - Mostly Positive - Pre-Owned but Well Loved</a>. </li>
<li><a href="https://www.smartkarma.com/insights/aihuishou-pre-ipo-first-stab-at-valuation" target="_blank" rel="noopener">AiHuiShou Pre-IPO - First Stab at Valuation</a></li>
<li><a href="https://www.smartkarma.com/insights/aihuishou-pre-ipo-pricing-my-mobile-handset-at-physical-stores" target="_blank" rel="noopener">Aihuishou (爱回收) Pre-IPO: Pricing My Mobile Handset at Physical Stores</a></li>
</ul></div><div>
<ul><li><a href="https://www.smartkarma.com/insights/aihuishou-ipo-priced-to-go-but-won-t-do-a-kanzhun" target="_blank" rel="noopener">AiHuiShou IPO - Priced to Go but Won’t Do a Kanzhun</a></li></ul>
<p>In this note, we will talk about the trading dynamics.</p>
</div>

Aihuishou (RERE US) (AHS), China’s largest pre-owned consumer electronics transactions and services platform, raised around US$230m via a US listing. It is backed by JD.com Inc (ADR) (JD US), Morningside and Tiger Global.We covered some aspects of the deal in our earlier notes:

AiHuiShou Pre-IPO - Mostly Positive - Pre-Owned but Well Loved. 
AiHuiShou Pre-IPO - First Stab at Valuation
Aihuishou (爱回收) Pre-IPO: Pricing My Mobile Handset at Physical Stores

AiHuiShou IPO - Priced to Go but Won’t Do a Kanzhun
In this note, we will talk about the trading dynamics.


AiHuiShou IPO Trading - Probably Close to Fair Value but Has a Long Runway

Japan

Mercari, Inc. operates as an electronic commercial company. The Company offers electronic commercial software, operation management, marketing planning, and other marketplace services. Mercari serves customers worldwide.

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Mercari (4385 JP)

Japan's Governance: Convertible Bonds Issue

As the issuance of convertible bonds is expected to increase going forward, issuers will be required to be even more accountable for their future...

Metrical Inc

Japan Fintech - Google Push into Mobile Payments Could Raise Competitive Intensity

Google is considering an acquisition that would allow it to compete directly in JP mobile payments. It lacks a direct consumer business but Android...

Kirk Boodry

Mercari – Up 10% on What Should Have Been an Unsurprising Upward Revision

The intensity of Mercari's 10% up move on an upward revision is surprising and demonstrates that the market seems to be as behind as consensus in...

Mio Kato

Marui to Invest ¥80 Billion over 5 Years in FinTech & Buildings

Marui is often dismissed as a legacy retailer, partly because of its association with department stores. This is wrong: Marui has potential in...

Michael Causton

AiHuiShou IPO Trading - Probably Close to Fair Value but Has a Long Runway

Aihuishou (RERE US), China’s largest pre-owned consumer electronics transactions and services platform, raised up to US$243m via a US listing. It...

Sumeet Singh

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