Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>There has been a recent non-life insurer price-fixing scandal. The JFTC and FSA investigated. Last December, the FSA issued Business Improvement Orders to the four majors. </li>
<li>There was a Bigmotor scandal last summer and Sompo Japan got a Business Improvement Order last month. All four insurers have to respond to a BIO for the price-fixing scandal.</li>
<li>9 Feb post-close, Jiji/<a href="https://www.nikkei.com/article/DGXZQOUB255TQ0V20C24A1000000/" target="_blank" rel="noopener">Nikkei</a> had articles saying the FSA had urged four major non-lifes subject to the first BIO to accelerate sales of ¥6.5trln+ of 5,900 Cross-Holdings. That's big.</li>
</ul>


There has been a recent non-life insurer price-fixing scandal. The JFTC and FSA investigated. Last December, the FSA issued Business Improvement Orders to the four majors. 
There was a Bigmotor scandal last summer and Sompo Japan got a Business Improvement Order last month. All four insurers have to respond to a BIO for the price-fixing scandal.
9 Feb post-close, Jiji/Nikkei had articles saying the FSA had urged four major non-lifes subject to the first BIO to accelerate sales of ¥6.5trln+ of 5,900 Cross-Holdings. That's big.


[Japan Governance] FSA Urges Japan Non-Life Insurers to Eliminate Cross-Holdings - Sales Coming

Equity Bottom-Up

<ul>
<li>With FY23 earnings in May, <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota Motor (7203 JP)</a> announced a ¥1trn buyback (410mm shares, 3.04%). Given shares were ¥3,599 the day before, it meant fewer shares or a Tender.</li>
<li>Like Honda (who hadn't bought pre-offering), Toyota hadn't bought back in the first couple of months. We knew there was bank and insurer overhang. That overhang lasts for years. </li>
<li>Today, Toyota announced an "organised" 410mm share ¥1trln Tender Offer Buyback. Several financial institutions have announced plans to tender. This provides guidance on supply/demand for the rest of the year.</li>
</ul>


With FY23 earnings in May, Toyota Motor (7203 JP) announced a ¥1trn buyback (410mm shares, 3.04%). Given shares were ¥3,599 the day before, it meant fewer shares or a Tender.
Like Honda (who hadn't bought pre-offering), Toyota hadn't bought back in the first couple of months. We knew there was bank and insurer overhang. That overhang lasts for years. 
Today, Toyota announced an "organised" 410mm share ¥1trln Tender Offer Buyback. Several financial institutions have announced plans to tender. This provides guidance on supply/demand for the rest of the year.


Toyota's BIG Buyback Via Tender Offer from Banks & Insurers

<ul>
<li>This month (June) saw 1,673 Corporate Governance Reports filed and 5 new "Mgmt Conscious of Capital Cost/Stock Price" policies filed. </li>
<li>We created a tool show every report, provide links to every document, and now a new diff file tool. Put in a name, see the difference between the Old/New Reports.</li>
<li>We hope this took will help. It is designed to be a shelf reference. We update the tool once a month, a couple of weeks ahead of the TSE.</li>
</ul>


This month (June) saw 1,673 Corporate Governance Reports filed and 5 new "Mgmt Conscious of Capital Cost/Stock Price" policies filed. 
We created a tool show every report, provide links to every document, and now a new diff file tool. Put in a name, see the difference between the Old/New Reports.
We hope this took will help. It is designed to be a shelf reference. We update the tool once a month, a couple of weeks ahead of the TSE.


Japan CorpGovReport Details: TSE "Mgmt Conscious of Capital Cost/Stock Price" Details (Jul24)

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.

<ul>
<li>The Japanese Financial Services Agency has asked the general insurers to reduce/eliminate their cross-shareholdings.</li>
<li>
<a href="https://www.smartkarma.com/entities/ms-ad-insurance-group-holdings" target="_blank" data-smartkarma-citation="entities:631:1" rel="noopener">MS&amp;AD Insurance (8725 JP)</a> had a stake over US$100m in at least 29 listed Japanese stocks, amounting to a total of US$17.4bn.</li>
<li>In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.</li>
</ul>


The Japanese Financial Services Agency has asked the general insurers to reduce/eliminate their cross-shareholdings.

MS&amp;AD Insurance (8725 JP) had a stake over US$100m in at least 29 listed Japanese stocks, amounting to a total of US$17.4bn.
In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.


MS&AD Cross-Shareholding - At Least US$20bn of Cross-Shareholding to Sell

Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Kawasaki Heavy Industries / Equity Bottom-Up

<ul>
<li>Expect continued buying in defense related, as well as banks and life insurance, renewable energy, rails, and medical IT plays with Shigeru Ishiba at the helm. </li>
<li>The Market will be quick to rotate out of names which spiked into Friday's close on expectation for a Sanae Takaichi win in the LDP election.  </li>
<li>Ishiba has been a vocal critic of Abenomics, and his potential policies aimed at higher taxes for investment incomes and capital gains are set to weigh on the Japanese market. </li>
</ul>


Expect continued buying in defense related, as well as banks and life insurance, renewable energy, rails, and medical IT plays with Shigeru Ishiba at the helm. 
The Market will be quick to rotate out of names which spiked into Friday's close on expectation for a Sanae Takaichi win in the LDP election.  
Ishiba has been a vocal critic of Abenomics, and his potential policies aimed at higher taxes for investment incomes and capital gains are set to weigh on the Japanese market. 


Best Outright and Pair Trades for an Ishiba-Led LDP

Japan

MS&AD Insurance Group Holdings, Inc. is a holding company established through reorganization of Mitsui Sumitomo Insurance Company, Limited.  The Group writes marine, fire, casualty, automobile, life, and allied insurance policies. MS&AD Insurance Group also operates financial services and agencies.

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MS&AD Insurance (8725 JP)

[Japan Governance] FSA Urges Japan Non-Life Insurers to Eliminate Cross-Holdings - Sales Coming

Japan's non-life insurers have long been something like a closed end equity portfolio plus an asset swap. Now scandals have driven the FSA to push...

Travis Lundy

Toyota's BIG Buyback Via Tender Offer from Banks & Insurers

Toyota today announced an ¥800bn Tender Offer Buyback to buy back one-third of the equity stakes held by major non-life insurers. They, in turn,...

Travis Lundy

Japan CorpGovReport Details: TSE "Mgmt Conscious of Capital Cost/Stock Price" Details (Jul24)

There were 1,670+ new Corporate Governance Reports filed in the month of June. That includes a 27 updates of "Implementing Mgmt Consciousness of...

Travis Lundy

MS&AD Cross-Shareholding - At Least US$20bn of Cross-Shareholding to Sell

Along with its results announcement today, MS&AD announced that it will accelerate its cross-shareholding unwind and is targeting a sale of around...

Sumeet Singh

Best Outright and Pair Trades for an Ishiba-Led LDP

How to position in Japanese equities after the surprise win by Shigeru Ishiba over Sanae Takaichi in Friday's LDP election.

Andrew Jackson

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