Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Quantitative Analysis

<p>There are currently ~1,500 stocks listed in the Mothers, JASDAQ, and Second Sections of the Tokyo Stock Exchange. As time passes, some of these stocks will "graduate" to the First Section of the Tokyo Stock Exchange (TSE1), triggering inclusion into the TOPIX Index causing passive funds tracking TOPIX to buy them on an inclusion event. This presents various trading opportunities in several phases of this event timeline.  </p><p>Being able to identify such candidates at a "Pre-event" phase (before the TSE reassignment is confirmed) can unlock great value for speculative bets as we recently witnessed in the case of <a href="https://www.smartkarma.com/insights/topix-inclusion-4931-jp-shinnihonseiyaku" target="_blank" data-smartkarma-citation="insights:45660" rel="noopener">TOPIX Inclusion (4931 JP): Shinnihonseiyaku</a> where the stock gained 90%+ in the ~5 months leading to the TSE1-reassignment announcement. </p><p>However, in July 2020, TSE introduced more stringent new Section Transfer Requirements and TSE1 Listing Criteria adding a new layer of complexity to this prediction process, especially during the period of transition from the old rules to the new rules. </p><p>In this insight, we take a look at how some of the potential TSE1 candidates will fare against these New Section Transfer Requirements and evaluate their attractiveness at the Pre-event phase. </p><hr><div class="content-remarks"><p>This insight is an update to <a href="https://www.smartkarma.com/insights/topix-inclusion-pre-events-who-is-ready" target="_blank" data-smartkarma-citation="insights:41091" rel="noopener">TOPIX Inclusion Pre-Events: Who Is Ready?</a>. Please refer to that insight for more information on the approach used in the below analysis. Note that some assumptions used in the analysis have changed since then. </p></div>

There are currently ~1,500 stocks listed in the Mothers, JASDAQ, and Second Sections of the Tokyo Stock Exchange. As time passes, some of these stocks will "graduate" to the First Section of the Tokyo Stock Exchange (TSE1), triggering inclusion into the TOPIX Index causing passive funds tracking TOPIX to buy them on an inclusion event. This presents various trading opportunities in several phases of this event timeline.  Being able to identify such candidates at a "Pre-event" phase (before the TSE reassignment is confirmed) can unlock great value for speculative bets as we recently witnessed in the case of TOPIX Inclusion (4931 JP): Shinnihonseiyaku where the stock gained 90%+ in the ~5 months leading to the TSE1-reassignment announcement. However, in July 2020, TSE introduced more stringent new Section Transfer Requirements and TSE1 Listing Criteria adding a new layer of complexity to this prediction process, especially during the period of transition from the old rules to the new rules. In this insight, we take a look at how some of the potential TSE1 candidates will fare against these New Section Transfer Requirements and evaluate their attractiveness at the Pre-event phase. This insight is an update to TOPIX Inclusion Pre-Events: Who Is Ready?. Please refer to that insight for more information on the approach used in the below analysis. Note that some assumptions used in the analysis have changed since then. 

TOPIX Inclusions:  New Regulations! Who Is READY? 2.0

Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

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>Sansan Inc, the business card digitisation company, reported its full-year FY05/2020 results early this week which saw strong growth in revenue and operating profits. At the same time, both revenue and OP beat consensus estimates by a significant margin and the results marked the company’s first full-year of operating profits despite being affected by the Covid-19 pandemic.</p>

Sansan Inc, the business card digitisation company, reported its full-year FY05/2020 results early this week which saw strong growth in revenue and operating profits. At the same time, both revenue and OP beat consensus estimates by a significant margin and the results marked the company’s first full-year of operating profits despite being affected by the Covid-19 pandemic.

Sansan 4QFY05/20 Results: First Full-Year of Operating Profits Despite Covid-19 Impact

'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

Thematic (Sector/Industry)

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/144/594/original/2020-07-07_06-10-50.png?1594069912" class="editor-image img-responsive" data-smartkarma-image-id="144594"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/144/595/original/2020-07-07_06-24-06.png?1594070670" class="editor-image img-responsive" data-smartkarma-image-id="144595"></figure><div class="content-caption">Source • Japan Analytics</div><p><strong><a href="https://www.smartkarma.com/entities/mani-inc" target="_blank" data-smartkarma-citation="entities:6534:1" rel="noopener">Mani (7730 JP)</a> -</strong> Medical instrument maker Mani had warned at the time of their interim results of a poor second half, and their third-quarter results are duly sombre. Mani is one of Japan's more global companies, having less than a quarter of sales in the domestic market and is suffering accordingly - an operating profit of just ¥0.1 billion is implied for the fourth quarter. The company has done well to improve margins despite a 19% decline in revenues over the last six quarters, primarily through lowering the costs of goods sold. The shares have remained stubbornly Overbought. The current valuation suggests limited upside, a<span>bsent a sharp top-line rebound, while</span><span> 'shorts' will have to contend with the 'quality-at-any-price' brigade.</span></p><p style="text-align: center;"><strong>DAILY STATS</strong></p><hr><div><p style="text-align: center;"><strong>15 Quarterly Results</strong></p></div><div><ul>
<li>
<strong>Results Score:</strong> 7 Positive / 2 Neutral / 6 Negative</li>
<li>
<strong>Average Results Score Change:</strong>-2.6</li>
<li>
<strong>Average % Change in Revenue:</strong> -3.8% Quarter YoY* / -1.0% Rolling TTM YoY</li>
<li>
<strong>Average Operating Profit Margin Change:</strong> -1.7ppt</li>
</ul></div><hr><div><p style="text-align: center;"><br><strong>5 Annual • 3 Interim Forecasts/Revisions</strong></p></div><div><ul>
<li>
<strong>Annual Forecast/Revision Score:</strong> 3 Positive / 0 Neutral / 1 Negative</li>
<li>
<strong>Interim Forecast/Revision Score Change:</strong> 2 Positive / 1 Neutral / 0 Negative</li>
<li>
<strong>Average Forecast/Revision Score Change:</strong> -2.6</li>
</ul></div>

Source • Japan AnalyticsMani (7730 JP) - Medical instrument maker Mani had warned at the time of their interim results of a poor second half, and their third-quarter results are duly sombre. Mani is one of Japan's more global companies, having less than a quarter of sales in the domestic market and is suffering accordingly - an operating profit of just ¥0.1 billion is implied for the fourth quarter. The company has done well to improve margins despite a 19% decline in revenues over the last six quarters, primarily through lowering the costs of goods sold. The shares have remained stubbornly Overbought. The current valuation suggests limited upside, absent a sharp top-line rebound, while 'shorts' will have to contend with the 'quality-at-any-price' brigade.DAILY STATS15 Quarterly Results

Results Score: 7 Positive / 2 Neutral / 6 Negative

Average Results Score Change:-2.6

Average % Change in Revenue: -3.8% Quarter YoY* / -1.0% Rolling TTM YoY

Average Operating Profit Margin Change: -1.7ppt
 5 Annual • 3 Interim Forecasts/Revisions

Annual Forecast/Revision Score: 3 Positive / 0 Neutral / 1 Negative

Interim Forecast/Revision Score Change: 2 Positive / 1 Neutral / 0 Negative

Average Forecast/Revision Score Change: -2.6


🇯🇵 JAPAN • Results & Revisions 6th July - Man(I) Overboard!

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/525/original/File%202020-04-12%203%2030%2058.jpeg?1586636737" class="editor-image img-responsive" data-smartkarma-image-id="127525"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/559/original/File%202020-04-12%208%2003%2009.jpeg?1586646443" class="editor-image img-responsive" data-smartkarma-image-id="127559"></figure><div class="content-caption">Source • ourworldindata.org</div><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/550/original/File%202020-04-12%207%2012%2036.jpeg?1586643194" class="editor-image img-responsive" data-smartkarma-image-id="127550"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/551/original/File%202020-04-12%207%2014%2052.jpeg?1586643688" class="editor-image img-responsive" data-smartkarma-image-id="127551"></figure><div class="content-caption">Source • Financial Times</div><p style="text-align: left;"><strong>CONTAINMENT NOT CONTAGION (SO FAR)</strong> - In the last week, the number of daily new confirmed cases of COVID-19 has increased from 300-400 to 500-600 of which Tokyo represents about one third. The case count is rising in many hitherto unaffected prefectures, partly as a result of migrations out of the seven prefectures which are under the 'state of emergency' declared on 7th April and also due to the return of asymptomatic Japanese nationals based overseas. The number of active cases (currently 6,279), those in critical care (122) and deaths (114) have yet to peak, although on a per capita basis Japan is in line with its East Asian neighbours. For the Japanese social distancing 'experiment' to be deemed successful, the 7-day rolling peak number of new cases needs to be below 1,000.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/573/original/IMG_1249.jpg?1586663212" class="editor-image img-responsive" data-smartkarma-image-id="127573"></figure><div class="content-caption">Source • NHK</div><p style="text-align: left;"><strong>NO-LOCKDOWN 'LOCKDOWN'</strong> - Japan's evolving compromise between social distancing and preserving the economy has revealed tensions between the central and local governments over the implementation of the powers that the former has ceded to the latter. Governor Koike had pressed for a broader range of business closures but relented over beauty salons and barbershops. DIY stores, convenience stores and restaurants can also remain open provided social distancing measures are implemented. Prefectures that were not included in the initial seven have now proposed measures of their own, including compensation for businesses forced to close which the national government has, so far, ruled out. Although no curfews have been instituted a ban on selling alcohol after seven o'clock is a reasonable 'carrot-like' alternative. From the helicopter that NHK paid to survey the scene, Tokyo was all-but-deserted on Saturday night. On Sunday. The 'recommendation' to refrain from going to bars and nightclubs has been extended to cover the whole of Japan. </p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/575/original/lots-of-hanko.jpg?1586663417" class="editor-image img-responsive" data-smartkarma-image-id="127575"></figure><div class="content-caption">Source • Wikimedia Commons</div><p><strong>WFH</strong> - PM Abe has very forcibly called for companies to institute 'WFH' for up to 70% of clerical staff - a factor which supports our continued bullish view for the <strong>Information Technology</strong> Sector. A Tokyo Chamber Of Commerce survey suggests that less 54% of SMEs do not intend to comply. The problem of the use of personal seals or '<em>hanko</em>' for the certification of documents remains, requiring many employees to trek into the office to affix them. Perhaps this is a business opportunity for <a href="https://www.smartkarma.com/entities/sansan-inc" target="_blank" data-smartkarma-citation="entities:28112:1" rel="noopener">Sansan (4443 JP)</a>?</p><p><strong>SIDELINED</strong> - In recent weeks, Japan's COVID-19 policy response has been led more by the Cabinet Office and Economic and Fiscal Policy Minister Yasutoshi Nishimura rather than the Kato-san of the Ministry of Health, Labour and Welfare. Kato-san and his bureaucrats have fallen out of favour for their handling of the Diamond Princess, inflexibility over testing and the rules requiring all positive cases to be hospitalised and the approval process of <a href="https://www.smartkarma.com/entities/fujifilm-holdings-corp" target="_blank" data-smartkarma-citation="entities:16353:1" rel="noopener">Fujifilm (4901 JP)</a>'s drug Avigan for use in COVID-19 cases. For better or worse, Japan's response to COVID-19 is being driven by broader considerations than the longevity of its elderly citizens.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/571/original/2020-04-12_12-13-13.png?1586661205" class="editor-image img-responsive" data-smartkarma-image-id="127571"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/572/original/2020-04-12_12-12-59.png?1586661219" class="editor-image img-responsive" data-smartkarma-image-id="127572"></figure><div class="content-caption">Source • EpiCentro/Istituto Superiore di Sanità </div><p><strong>HARD CHOICES</strong> - It is highly unlikely that Japan's first 'wave' of COVID-19 infections will peak conveniently to coincide with the Golden Week holiday period. However, as is becoming evident in New York City, the impact of 'total lockdowns' has been overestimated relative to social distancing Temporary overflow hospitals are empty, and in some US states have been closed or handed back to the military. <a href="https://www.epicentro.iss.it/en/coronavirus/bollettino/Report-COVID-2019_2_april_2020.pdf" target="_blank" rel="noopener">Evidence</a> from Italy's EpiCentro/Istituto Superiore di Sanità shows that the vast majority of fatalities are found in those over 60 years of age who have one or more comorbidity. These findings are also valid for Japan and other developed countries. As the economic cost of the moral imperative behind lockdowns becomes clear, the pressure to restart will increase, and the protocols for reaching herd immunity will be debated. The likelihood of second and third 'waves' before the widespread availability of mass-testing or vaccinees may require semi-permanent social-distancing for the most vulnerable and prolonged shutdowns of the crowded, noisy indoor venues that attract the most foolhardy. By anticipating the post-COVID protocols, The approach adopted by Taiwan, South Korea, Singapore and Japan offers a better glide-path to economic recovery. All are, however, dependent on the major Western economies, currently pickled in aspic, finding their exit strategies before summer.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/661/original/File%202020-04-13%205%2057%2023.jpeg?1586725178" class="editor-image img-responsive" data-smartkarma-image-id="127661"></figure><div class="content-caption">Source • gotazual@nyit.edu</div><p><strong>PRO-VAX</strong> - Another factor in Japan's favour is the country's early adoption, in 1947, of a universal childhood BCG vaccination programme. A recent <a href="https://www.medrxiv.org/content/10.1101/2020.03.24.20042937v1" target="_blank" rel="noopener">study</a> has found that "<em>countries without universal policies of BCG vaccination (Italy, Netherlands, Belgium United States) have been more severely affected compared to countries with universal and long-standing BCG policies. Countries that have a late start of universal BCG policy (Iran, 1984) had high mortality, consistent with the idea that BCG protects the vaccinated elderly population. We also found that BCG vaccination also reduced the number of reported COVID-19 cases in a country. The combination of reduced morbidity and mortality makes BCG vaccination a potential new tool in the fight against COVID-19.</em>" Ironically for President Bolsonaro, Brazil's programme started in 1920 and currently has an even lower mortality rate than Japan.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/583/original/File%202020-04-12%2014%2045%2024.jpeg?1586670339" class="editor-image img-responsive" data-smartkarma-image-id="127583"></figure><div class="content-caption">Source • oec.world</div><p><strong>CHINA PASSING -</strong> Of longer-term significance, Japan's COVID-19 stimulus package includes U¥220 billion to support Japanese companies moving production facilities out of China. Imports from China have fallen by more than 50% year-on-year and many Japanese manufacturers have been starved of critical components. While high-value-added parts will be shifted home, others could be sourced from SouthEast Asian countries.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/586/original/File%202020-04-12%2015%2002%2044.jpeg?1586671392" class="editor-image img-responsive" data-smartkarma-image-id="127586"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/127/587/original/File%202020-04-12%2015%2006%2029.jpeg?1586671741" class="editor-image img-responsive" data-smartkarma-image-id="127587"></figure><div class="content-caption">Source • McKinsey</div><p><strong>FOOD SECURITY</strong> - Meanwhile, several countries, including India, Russia, Kazakhstan, Ukraine, Vietnam, and Romania, are restricting exports of foodstuffs. Fortunately for Japan, much of the nations food imports come from the United States, Australia and Canada. Nevertheless, we expect a repeat of the 2008 food price inflation before the summer and suggest 'treading carefully; in the currently buoyant <strong>Food Beverage &amp; Tobacco</strong> Sector.</p><div>
<p><strong>SELECTIVELY BULLISH</strong> - While Japan's globally-orientated companies will struggle with almost no demand from the lockdown economies, specific domestic Sectors and Peer Groups, such as <strong>Information Technology </strong>and<strong> Internet Content &amp; Services</strong> are thriving in the COVID economy. Overall, by resisting a total lockdown, Japan remains relatively well-placed for 'the other side'. </p>
<p>In the <strong>DETAIL</strong> section below, we shall provide an update on the market overall, look at Sector and Peer Group performance and review the results and revision announcements made on Friday.</p>
<blockquote><p style="text-align: center;"><strong>It is not given to human beings - happily for them, for otherwise life would be intolerable - to foresee or to predict to any large extent the unfolding course of events." - Winston Churchill</strong></p></blockquote>
</div>

Source • ourworldindata.orgSource • Financial TimesCONTAINMENT NOT CONTAGION (SO FAR) - In the last week, the number of daily new confirmed cases of COVID-19 has increased from 300-400 to 500-600 of which Tokyo represents about one third. The case count is rising in many hitherto unaffected prefectures, partly as a result of migrations out of the seven prefectures which are under the 'state of emergency' declared on 7th April and also due to the return of asymptomatic Japanese nationals based overseas. The number of active cases (currently 6,279), those in critical care (122) and deaths (114) have yet to peak, although on a per capita basis Japan is in line with its East Asian neighbours. For the Japanese social distancing 'experiment' to be deemed successful, the 7-day rolling peak number of new cases needs to be below 1,000.Source • NHKNO-LOCKDOWN 'LOCKDOWN' - Japan's evolving compromise between social distancing and preserving the economy has revealed tensions between the central and local governments over the implementation of the powers that the former has ceded to the latter. Governor Koike had pressed for a broader range of business closures but relented over beauty salons and barbershops. DIY stores, convenience stores and restaurants can also remain open provided social distancing measures are implemented. Prefectures that were not included in the initial seven have now proposed measures of their own, including compensation for businesses forced to close which the national government has, so far, ruled out. Although no curfews have been instituted a ban on selling alcohol after seven o'clock is a reasonable 'carrot-like' alternative. From the helicopter that NHK paid to survey the scene, Tokyo was all-but-deserted on Saturday night. On Sunday. The 'recommendation' to refrain from going to bars and nightclubs has been extended to cover the whole of Japan. Source • Wikimedia CommonsWFH - PM Abe has very forcibly called for companies to institute 'WFH' for up to 70% of clerical staff - a factor which supports our continued bullish view for the Information Technology Sector. A Tokyo Chamber Of Commerce survey suggests that less 54% of SMEs do not intend to comply. The problem of the use of personal seals or 'hanko' for the certification of documents remains, requiring many employees to trek into the office to affix them. Perhaps this is a business opportunity for Sansan (4443 JP)?SIDELINED - In recent weeks, Japan's COVID-19 policy response has been led more by the Cabinet Office and Economic and Fiscal Policy Minister Yasutoshi Nishimura rather than the Kato-san of the Ministry of Health, Labour and Welfare. Kato-san and his bureaucrats have fallen out of favour for their handling of the Diamond Princess, inflexibility over testing and the rules requiring all positive cases to be hospitalised and the approval process of Fujifilm (4901 JP)'s drug Avigan for use in COVID-19 cases. For better or worse, Japan's response to COVID-19 is being driven by broader considerations than the longevity of its elderly citizens.Source • EpiCentro/Istituto Superiore di Sanità HARD CHOICES - It is highly unlikely that Japan's first 'wave' of COVID-19 infections will peak conveniently to coincide with the Golden Week holiday period. However, as is becoming evident in New York City, the impact of 'total lockdowns' has been overestimated relative to social distancing Temporary overflow hospitals are empty, and in some US states have been closed or handed back to the military. Evidence from Italy's EpiCentro/Istituto Superiore di Sanità shows that the vast majority of fatalities are found in those over 60 years of age who have one or more comorbidity. These findings are also valid for Japan and other developed countries. As the economic cost of the moral imperative behind lockdowns becomes clear, the pressure to restart will increase, and the protocols for reaching herd immunity will be debated. The likelihood of second and third 'waves' before the widespread availability of mass-testing or vaccinees may require semi-permanent social-distancing for the most vulnerable and prolonged shutdowns of the crowded, noisy indoor venues that attract the most foolhardy. By anticipating the post-COVID protocols, The approach adopted by Taiwan, South Korea, Singapore and Japan offers a better glide-path to economic recovery. All are, however, dependent on the major Western economies, currently pickled in aspic, finding their exit strategies before summer.Source • gotazual@nyit.eduPRO-VAX - Another factor in Japan's favour is the country's early adoption, in 1947, of a universal childhood BCG vaccination programme. A recent study has found that "countries without universal policies of BCG vaccination (Italy, Netherlands, Belgium United States) have been more severely affected compared to countries with universal and long-standing BCG policies. Countries that have a late start of universal BCG policy (Iran, 1984) had high mortality, consistent with the idea that BCG protects the vaccinated elderly population. We also found that BCG vaccination also reduced the number of reported COVID-19 cases in a country. The combination of reduced morbidity and mortality makes BCG vaccination a potential new tool in the fight against COVID-19." Ironically for President Bolsonaro, Brazil's programme started in 1920 and currently has an even lower mortality rate than Japan.Source • oec.worldCHINA PASSING - Of longer-term significance, Japan's COVID-19 stimulus package includes U¥220 billion to support Japanese companies moving production facilities out of China. Imports from China have fallen by more than 50% year-on-year and many Japanese manufacturers have been starved of critical components. While high-value-added parts will be shifted home, others could be sourced from SouthEast Asian countries.Source • McKinseyFOOD SECURITY - Meanwhile, several countries, including India, Russia, Kazakhstan, Ukraine, Vietnam, and Romania, are restricting exports of foodstuffs. Fortunately for Japan, much of the nations food imports come from the United States, Australia and Canada. Nevertheless, we expect a repeat of the 2008 food price inflation before the summer and suggest 'treading carefully; in the currently buoyant Food Beverage &amp; Tobacco Sector.
SELECTIVELY BULLISH - While Japan's globally-orientated companies will struggle with almost no demand from the lockdown economies, specific domestic Sectors and Peer Groups, such as Information Technology and Internet Content &amp; Services are thriving in the COVID economy. Overall, by resisting a total lockdown, Japan remains relatively well-placed for 'the other side'. 
In the DETAIL section below, we shall provide an update on the market overall, look at Sector and Peer Group performance and review the results and revision announcements made on Friday.
It is not given to human beings - happily for them, for otherwise life would be intolerable - to foresee or to predict to any large extent the unfolding course of events." - Winston Churchill


🇯🇵 JAPAN MARKET (& COVID-19) UPDATE - 12th April • To Each Their Own

Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/sansan-inc/overview" target="_blank" rel="noopener">Sansan Inc. (4443 JP)</a>, the business card digitisation company reported its full-year FY05/2019 results on Friday (12<sup>th</sup> July 2019). The company was listed on the TSE Mothers Market on 19<sup>th</sup> June 2019 and these are the first results post the company’s IPO debut.</p>
<p>The full-year and the fourth quarter results for FY05/2019 saw strong growth in revenue while the company’s operating losses have declined significantly. For FY05/2020E, Sansan expects its topline growth to continue while it expects to report its first Operating Profits during the year as well as net profits.</p>
<p>Since the company shares started trading last month, the shares have gained nearly 30% to JPY5,810 per share at the end of Friday’s trade. However, based on our estimates, we believe the company shares are currently undervalued and deserve a premium to their current trading multiple. Furthermore, the company being able to generate positive returns in the near future should further boost share prices.</p>
<p>We discuss the details below.</p>

Sansan Inc. (4443 JP), the business card digitisation company reported its full-year FY05/2019 results on Friday (12th July 2019). The company was listed on the TSE Mothers Market on 19th June 2019 and these are the first results post the company’s IPO debut.
The full-year and the fourth quarter results for FY05/2019 saw strong growth in revenue while the company’s operating losses have declined significantly. For FY05/2020E, Sansan expects its topline growth to continue while it expects to report its first Operating Profits during the year as well as net profits.
Since the company shares started trading last month, the shares have gained nearly 30% to JPY5,810 per share at the end of Friday’s trade. However, based on our estimates, we believe the company shares are currently undervalued and deserve a premium to their current trading multiple. Furthermore, the company being able to generate positive returns in the near future should further boost share prices.
We discuss the details below.

Sansan’s First Post IPO Results: Topline Grows, Losses Shrink and Expects Profit in FY05/2020E

Japan

Sansan, Inc. provides mobile application software solutions. The Company offers business card management service by scanning the cards from scanner and smartphone. Sansan provides its services throughout Japan.

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Sansan Inc (4443 JP)

TOPIX Inclusions: New Regulations! Who Is READY? 2.0

The TSE has new Listing Rules and Criteria for TSE1 listing and promotion. That means new analysis on what pre-event trades. One TOP PICK to trade...

Janaghan Jeyakumar, CFA

Sansan 4QFY05/20 Results: First Full-Year of Operating Profits Despite Covid-19 Impact

Sansan Inc, the business card digitisation company, reported its full-year FY05/2020 results early this week which saw strong growth in revenue and...

Shifara Samsudeen, ACMA, CGMA

🇯🇵 JAPAN • Results & Revisions 6th July - Man(I) Overboard!

Mani (7730 JP) - Medical instrument maker Mani had warned at the time of their interim results of a poor second half, and their third-quarter...

Campbell Gunn

🇯🇵 JAPAN MARKET (& COVID-19) UPDATE - 12th April • To Each Their Own

CONTAINMENT NOT CONTAGION (SO FAR) - In the last week, the number of daily new confirmed cases of COVID-19 has increased from 300-400 to 500-600 of...

Campbell Gunn

Sansan’s First Post IPO Results: Topline Grows, Losses Shrink and Expects Profit in FY05/2020E

Sansan Inc. (4443 JP), the business card digitisation company reported its full-year FY05/2019 results on Friday (12th July 2019). The company was...

Shifara Samsudeen, ACMA, CGMA

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52-week Range

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