Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>ARM +11% after a broker upgrade yesterday will see <a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a> rebound sharply off heavily sold levels yesterday, despite its surprise Y500bn buyback.</li>
<li>Tech wide relief rally in the US sets the tone for a very strong day in Japan, helped by strong earnings by the likes of <a href="https://www.smartkarma.com/entities/tokyo-electron-ltd" target="_blank" data-smartkarma-citation="entities:280:1" rel="noopener">TEL (8035)</a> and <a href="https://www.smartkarma.com/entities/kokusai-electric-corp" target="_blank" data-smartkarma-citation="entities:40152:1" rel="noopener">Kokusai (6525).</a>
</li>
<li>Jobs data saw leisure and powersports names in the US rally which should help the likes of <a href="https://www.smartkarma.com/entities/yamaha-motor-co-ltd" target="_blank" data-smartkarma-citation="entities:7411:1" rel="noopener">Yamaha Motor (7272 JP)</a> and <a href="https://www.smartkarma.com/entities/kawasaki-heavy-industries" target="_blank" data-smartkarma-citation="entities:8790:1" rel="noopener">KHI (7012 JP)</a> rebound sharply also.</li>
</ul>


ARM +11% after a broker upgrade yesterday will see Softbank Group (9984 JP) rebound sharply off heavily sold levels yesterday, despite its surprise Y500bn buyback.
Tech wide relief rally in the US sets the tone for a very strong day in Japan, helped by strong earnings by the likes of TEL (8035) and Kokusai (6525).

Jobs data saw leisure and powersports names in the US rally which should help the likes of Yamaha Motor (7272 JP) and KHI (7012 JP) rebound sharply also.


Japan Morning Connection: 9984 JP, 8035 JP, 6525 JP

Japan Specialist

Mark Chadwick

<ul>
<li>Early gains in US stocks fizzles out; Vix volatility index remains elevated at around 28 points</li>
<li>Mixed bag of Japanese earnings; auto makers Honda and Mazda both post decent numbers on yen weakness and just having the right product in the market</li>
<li>Super Micro shares dropped 15% on Q4 results, highlighting supply-chain issues. This creates a potential buy opportunity for Nidec, down 12% since Q1.</li>
</ul>


Early gains in US stocks fizzles out; Vix volatility index remains elevated at around 28 points
Mixed bag of Japanese earnings; auto makers Honda and Mazda both post decent numbers on yen weakness and just having the right product in the market
Super Micro shares dropped 15% on Q4 results, highlighting supply-chain issues. This creates a potential buy opportunity for Nidec, down 12% since Q1.


Ohayo Japan | US Recovery Fizzles Out; Not so Super Micro

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>There are 44 adds/41 deletes for the JPX Nikkei 400 Index to bring the number of index constituents back to 400. There are stocks with multiple days ADV to trade.</li>
<li>Based on the adds, deletes and capping changes, we estimate one way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn).</li>
<li>The adds have outperformed the deletes over the last year though that has been faded over the last couple of months. Breaking with history, there could be outperformance near-term.</li>
</ul>


There are 44 adds/41 deletes for the JPX Nikkei 400 Index to bring the number of index constituents back to 400. There are stocks with multiple days ADV to trade.
Based on the adds, deletes and capping changes, we estimate one way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn).
The adds have outperformed the deletes over the last year though that has been faded over the last couple of months. Breaking with history, there could be outperformance near-term.


JPX Nikkei 400 Index Rebalance: A Bunch of Chunky Adds & US$6bn Trade

<ul>
<li>Meta and MSFT commented they are seeing benefits from their AI investments, pointing to increased capex positive for JP SPE names.</li>
<li>Advantest upgrading its tester market outlook for both SoC and memory over a solid 1Q earnings print will be positive for 6871 Micronics ahead of numbers.</li>
<li>Japan off the China export ban for now, however the US is unlikely to rollover and allow China unfettered access to cutting edge tech.</li>
</ul>


Meta and MSFT commented they are seeing benefits from their AI investments, pointing to increased capex positive for JP SPE names.
Advantest upgrading its tester market outlook for both SoC and memory over a solid 1Q earnings print will be positive for 6871 Micronics ahead of numbers.
Japan off the China export ban for now, however the US is unlikely to rollover and allow China unfettered access to cutting edge tech.


Japan Morning Connection - 6857 JP, 6871 JP, 6525 JP

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Chilled & Frozen Logistics Holdings / Event-Driven

<ul>
<li>The <a href="https://www.smartkarma.com/entities/chilled-frozen-logistics-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:40987:1" rel="noopener">Chilled &amp; Frozen Logistics Holdings (9099 JP)</a> Board has responded with several questions regarding <a href="https://www.smartkarma.com/entities/az-com-maruwa-holdings" target="_blank" data-smartkarma-citation="entities:17280:1" rel="noopener">AZ-Com Maruwa Holdings (9090 JP)</a>’s pre-conditional hostile offer of JPY3,000 per share.</li>
<li>The Board questions the transaction’s schedule, terms and potential synergies. The Board has also used the ruse that due diligence access would justify a higher offer price.</li>
<li>Expect several rounds of Q&amp;A and a delay to the tender start. If shares continue trading through terms ahead of the tender start, AZ-COM Maruwa will likely have to bump. </li>
</ul>


The Chilled &amp; Frozen Logistics Holdings (9099 JP) Board has responded with several questions regarding AZ-Com Maruwa Holdings (9090 JP)’s pre-conditional hostile offer of JPY3,000 per share.
The Board questions the transaction’s schedule, terms and potential synergies. The Board has also used the ruse that due diligence access would justify a higher offer price.
Expect several rounds of Q&amp;A and a delay to the tender start. If shares continue trading through terms ahead of the tender start, AZ-COM Maruwa will likely have to bump. 


Chilled & Frozen Logistics (9099 JP): Pass The🍿as the Board Responds to AZ-COM Maruwa (9090 JP)

Japan

NIDEC CORPORATION is the world's leading manufacturer of small precision motors mainly used in HDD and optical disk drives. The company has extended its focus to the home appliance and automotive markets. NIDEC is active in M&A and its subsidiaries include the world's leading manufacturers of LCD panel handling robots and camera shutters.

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Nidec Corp (6594 JP)

Japan Morning Connection: 9984 JP, 8035 JP, 6525 JP

ARM stock surges after broker upgrade, Softbank Group rebounds, tech rally in US boosts Japan market, leisure and powersports names rally in US...

Andrew Jackson

Ohayo Japan | US Recovery Fizzles Out; Not so Super Micro

US stocks struggle as Vix volatility index stays high, Japanese earnings mixed with Honda and Mazda performing well, Super Micro shares drop...

Mark Chadwick

JPX Nikkei 400 Index Rebalance: A Bunch of Chunky Adds & US$6bn Trade

There are 44 adds/41 deletes for the JPX Nikkei 400 Index resulting in a one-way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn)....

Brian Freitas

Japan Morning Connection - 6857 JP, 6871 JP, 6525 JP

Meta and MSFT's AI gains boost capex and JP SPE names. Advantest's strong outlook aids Micronics. Japan lifts China export ban, but US likely to...

Andrew Jackson

Chilled & Frozen Logistics (9099 JP): Pass The🍿as the Board Responds to AZ-COM Maruwa (9090 JP)

Expect several rounds of Q&A and a delay to the tender start. AZ-COM Maruwa could eventually bump closer to the May tender start. However, as...

Arun George

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Japan Morning Connection: 9984 JP, 8035 JP, 6525 JP

​ARM stock surges after broker upgrade, Softbank Group rebounds, tech rally in US boosts Japan market, leisure and powersports names rally in US...

Andrew Jackson

Ohayo Japan | US Recovery Fizzles Out; Not so Super Micro

​US stocks struggle as Vix volatility index stays high, Japanese earnings mixed with Honda and Mazda performing well, Super Micro shares drop...

Mark Chadwick

JPX Nikkei 400 Index Rebalance: A Bunch of Chunky Adds & US$6bn Trade

There are 44 adds/41 deletes for the JPX Nikkei 400 Index resulting in a one-way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn)....

Brian Freitas

Japan Morning Connection - 6857 JP, 6871 JP, 6525 JP

Meta and MSFT's AI gains boost capex and JP SPE names. Advantest's strong outlook aids Micronics. Japan lifts China export ban, but US likely to...

Andrew Jackson

Chilled & Frozen Logistics (9099 JP): Pass The🍿as the Board Responds to AZ-COM Maruwa (9090 JP)

Expect several rounds of Q&A and a delay to the tender start. AZ-COM Maruwa could eventually bump closer to the May tender start. However, as...

Arun George

ARM stock surges after broker upgrade, Softbank Group rebounds, tech rally in US boosts Japan market, leisure and powersports names rally in US...

US stocks struggle as Vix volatility index stays high, Japanese earnings mixed with Honda and Mazda performing well, Super Micro shares drop...