Japan Specialist

Mark Chadwick

Equity Bottom-Up

Mitsubishi Heavy Industries / Equity Bottom-Up

<ul>
<li>MHI reports impressive YoY growth in order intake, revenues, and profits across Energy Systems and Defense Equipment segments in Q2 2023.</li>
<li>Despite a 62% YTD stock price increase, strong order backlog and underlying drivers suggest resilience in a challenging economic climate.</li>
<li>The company benefits from global trends in decarbonization and increased national security spending, positioning itself as a leader in gas turbines and defense technology.</li>
</ul>


MHI reports impressive YoY growth in order intake, revenues, and profits across Energy Systems and Defense Equipment segments in Q2 2023.
Despite a 62% YTD stock price increase, strong order backlog and underlying drivers suggest resilience in a challenging economic climate.
The company benefits from global trends in decarbonization and increased national security spending, positioning itself as a leader in gas turbines and defense technology.


Senior Technology Analyst, Japanese Equities, LightStream Research

Scott Foster

Senior Technology Analyst, Japanese Equities

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>Japan's top defense and aerospace contractor is being rerated to account for the limits on relying on the U.S. for defense in an alarming national security environment.</li>
<li>A reasonably optimistic scenario brings MHI's P/E ratio down to 22X in FY Mar-28, by which time Japan's defense spending is scheduled reach 2% of GDP.</li>
<li>The Trump administration wants Japan to spend more, but getting the budget through the national Diet is difficult enough as it is. </li>
</ul>


Japan's top defense and aerospace contractor is being rerated to account for the limits on relying on the U.S. for defense in an alarming national security environment.
A reasonably optimistic scenario brings MHI's P/E ratio down to 22X in FY Mar-28, by which time Japan's defense spending is scheduled reach 2% of GDP.
The Trump administration wants Japan to spend more, but getting the budget through the national Diet is difficult enough as it is. 


MHI (7011 JP): U.S. Presses Japan to Spend More on Defense

Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>Memory names surging after bullish broker upgrades as mkt refuses to sell off into the shutdown.</li>
<li>Boeing taking a break but outlook for CF suppliers such as Toray ahead of the announcement for now Chinese orders looks positive.</li>
<li>Oil takes a sizeable hit with OPEC signalling supply increases on the way.</li>
</ul>


Memory names surging after bullish broker upgrades as mkt refuses to sell off into the shutdown.
Boeing taking a break but outlook for CF suppliers such as Toray ahead of the announcement for now Chinese orders looks positive.
Oil takes a sizeable hit with OPEC signalling supply increases on the way.


Japan Morning Connection: Wolfspeed Out of Chapter 11 as Expected and Stock Rallies 1726%

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

Quantitative Analysis

<ul>
<li>We analyzed the changes in margin trading positions of JPX stocks as of Dec 12th. The aggregated net margin trading position is USD19,648m.</li>
<li>We tabulate league tables for top/bottom net long/short of margin trading by value, net margin buy as multiple of ADT.</li>
<li>We highlight net margin buy/sell changes in Ci Medical, Toyoda Gosei, SoftBank, Toyota Motor, Lasertec, Skylark, Nintendo, Kawasaki Heavy Industries, Mitsubishi UFJ Financial, Tokyo Electron, Ci Medical, Toyoda Gosei.</li>
</ul>


We analyzed the changes in margin trading positions of JPX stocks as of Dec 12th. The aggregated net margin trading position is USD19,648m.
We tabulate league tables for top/bottom net long/short of margin trading by value, net margin buy as multiple of ADT.
We highlight net margin buy/sell changes in Ci Medical, Toyoda Gosei, SoftBank, Toyota Motor, Lasertec, Skylark, Nintendo, Kawasaki Heavy Industries, Mitsubishi UFJ Financial, Tokyo Electron, Ci Medical, Toyoda Gosei.


JPX Margin Trading Weekly (Dec 12th): Ci Medical, Toyoda Gosei, SoftBank, Toyota Motor, Lasertec

Global Materials | Industrials | Commodities

Rahul Jain

<ul>
<li>Structural Asia theme: AI-driven power demand, decarbonisation realism, and energy security are reviving nuclear across Asia’s value chain, with clearer cost and execution advantages versus the West.</li>
<li>Top equity plays: Kazatomprom anchors uranium scarcity; Mitsubishi Heavy offers quality equipment exposure; Doosan Enerbility provides high-beta EPC leverage as capex and SMRs scale.</li>
<li>• Selective risk framework: China drives volume but limited alpha; Japan offers execution-led equipment and restart upside; utilities and ETFs serve as stabilisers, not primary alpha drivers.</li>
</ul>


Structural Asia theme: AI-driven power demand, decarbonisation realism, and energy security are reviving nuclear across Asia’s value chain, with clearer cost and execution advantages versus the West.
Top equity plays: Kazatomprom anchors uranium scarcity; Mitsubishi Heavy offers quality equipment exposure; Doosan Enerbility provides high-beta EPC leverage as capex and SMRs scale.
• Selective risk framework: China drives volume but limited alpha; Japan offers execution-led equipment and restart upside; utilities and ETFs serve as stabilisers, not primary alpha drivers.


Asia’s Nuclear Revival: Structural Upside Across the Energy Value Chain

Japan

Mitsubishi Heavy Industries, Ltd. is a comprehensive heavy machinery maker. The Company manufactures machinery, ships, turbines and engines, prime movers, aircrafts, and machine parts for military and commercial use.  Mitsubishi Heavy Industries also researches and develops nuclear power plants.

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Mitsubishi Heavy Industries (7011 JP)

MHI (7011) | Rockets and Renewables

MHI reports strong growth in Q2 2023, benefiting from global trends in decarbonization and defense spending, positioning itself as a leader in gas...

Mark Chadwick

MHI (7011 JP): U.S. Presses Japan to Spend More on Defense

Up 40% in the past month, but still reasonably valued on a 3-year view if Japan's defense spending rises and margins expand as expected. 22X...

Scott Foster

Japan Morning Connection: Wolfspeed Out of Chapter 11 as Expected and Stock Rallies 1726%

Markets largely shake off shutdown concerns with memory exploding higher, watch 285A Kioxia. Toray may get a leg higher when China confirms...

Andrew Jackson

JPX Margin Trading Weekly (Dec 12th): Ci Medical, Toyoda Gosei, SoftBank, Toyota Motor, Lasertec

We analyzed JPX margin trading positions report for the past week and highlighted Ci Medical (3540 JP), Toyoda Gosei (7282 JP), SoftBank (9984 JP),...

Ke Yan, CFA, FRM

Asia’s Nuclear Revival: Structural Upside Across the Energy Value Chain

AI-driven power demand, decarbonisation, and energy security are boosting nuclear in Asia, with Kazatomprom, Mitsubishi Heavy, and Doosan...

Rahul Jain

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

MHI (7011) | Rockets and Renewables

​MHI reports strong growth in Q2 2023, benefiting from global trends in decarbonization and defense spending, positioning itself as a leader in gas...

Mark Chadwick

MHI (7011 JP): U.S. Presses Japan to Spend More on Defense

Up 40% in the past month, but still reasonably valued on a 3-year view if Japan's defense spending rises and margins expand as expected. 22X...

Scott Foster

Japan Morning Connection: Wolfspeed Out of Chapter 11 as Expected and Stock Rallies 1726%

Markets largely shake off shutdown concerns with memory exploding higher, watch 285A Kioxia. Toray may get a leg higher when China confirms...

Andrew Jackson

JPX Margin Trading Weekly (Dec 12th): Ci Medical, Toyoda Gosei, SoftBank, Toyota Motor, Lasertec

We analyzed JPX margin trading positions report for the past week and highlighted Ci Medical (3540 JP), Toyoda Gosei (7282 JP), SoftBank (9984 JP),...

Ke Yan, CFA, FRM

Asia’s Nuclear Revival: Structural Upside Across the Energy Value Chain

​AI-driven power demand, decarbonisation, and energy security are boosting nuclear in Asia, with Kazatomprom, Mitsubishi Heavy, and Doosan...

Rahul Jain

MHI reports strong growth in Q2 2023, benefiting from global trends in decarbonization and defense spending, positioning itself as a leader in gas...

AI-driven power demand, decarbonisation, and energy security are boosting nuclear in Asia, with Kazatomprom, Mitsubishi Heavy, and Doosan...