Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>Estee Lauder continues to  underwhelm on its China strategy, making names with less country exposure such as Kose look increasingly attractive</li>
<li>While the 7&amp;I deal outcome remains highly  uncertain, NKY225 replacement candidates should see a lift in the short-term</li>
<li>This includes PPIH, which looks oversold after yesterdays negative price reaction to the Founder's 22 year old son being promoted to a non-exec director.</li>
</ul>


Estee Lauder continues to  underwhelm on its China strategy, making names with less country exposure such as Kose look increasingly attractive
While the 7&amp;I deal outcome remains highly  uncertain, NKY225 replacement candidates should see a lift in the short-term
This includes PPIH, which looks oversold after yesterdays negative price reaction to the Founder's 22 year old son being promoted to a non-exec director.


Japan Morning Connection: Kose, 7&I, PPIH

<ul>
<li>Upbeat results briefing from <a href="https://www.smartkarma.com/entities/asahi-intecc-co-ltd" target="_blank" rel="noopener">Asahi Intecc</a> on Friday continues to make this look oversold with GPM bottoming, its MTP 1-year ahead of plan and strong growth outlooks for key markets China and US.</li>
<li>With numbers out for <a href="https://www.smartkarma.com/compose/insight/155896/Pan%20Pacific%20International%20Holdings%20(7532%20JP)" target="_blank" rel="noopener">PPIH</a> on Friday and the outlook reassuringly steady, this may start to get more attention as NKY225 inclusion candidate given it comes from the under-represented consumer goods segment.</li>
<li>AMAT numbers showing a decline in China revenues a red flag for Japanese SPE names overly reliant on China sales?</li>
</ul>


Upbeat results briefing from Asahi Intecc on Friday continues to make this look oversold with GPM bottoming, its MTP 1-year ahead of plan and strong growth outlooks for key markets China and US.
With numbers out for PPIH on Friday and the outlook reassuringly steady, this may start to get more attention as NKY225 inclusion candidate given it comes from the under-represented consumer goods segment.
AMAT numbers showing a decline in China revenues a red flag for Japanese SPE names overly reliant on China sales?


Japan Morning Connection: Asahi Intecc, PPIH

<ul>
<li>Watch for a 'megaquake' reversal after a big rotation for names deemed to be winners/losers on Friday on heightened expectations for a major Nankai Trough earthquake over the w/e</li>
<li>Retail related should rebound sharply after a solid 1Q showing from 3099 <a href="https://www.smartkarma.com/entities/isetan-mitsukoshi-holdings-ltd" target="_blank" data-smartkarma-citation="entities:18871:1" rel="noopener">Isetan Mitsukoshi</a>, with several related names yet to rebound on concerns the stronger yen will curb tourist spending.</li>
<li>1911 <a href="https://www.smartkarma.com/entities/sumitomo-forestry-co-ltd" target="_blank" data-smartkarma-citation="entities:9769:1" rel="noopener">Sumitomo Forestry</a> business briefing Friday confirms the strength of its US housing business, with it likely to easily exceed its latest MTP.</li>
</ul>


Watch for a 'megaquake' reversal after a big rotation for names deemed to be winners/losers on Friday on heightened expectations for a major Nankai Trough earthquake over the w/e
Retail related should rebound sharply after a solid 1Q showing from 3099 Isetan Mitsukoshi, with several related names yet to rebound on concerns the stronger yen will curb tourist spending.
1911 Sumitomo Forestry business briefing Friday confirms the strength of its US housing business, with it likely to easily exceed its latest MTP.


Japan Morning Connection: 3099 JP, 1911 JP, 5803 JP

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. 

Equity Bottom-Up

Isetan Mitsukoshi Holdings Ltd / Equity Bottom-Up

<ul>
<li>Isetan Shinjuku expects to post sales in excess of ¥400 billion this year, a record for a single retail store, although most of the growth is from inbound tourists. </li>
<li>But Isetan-Mitsukoshi is working to ensure longer term stability through more sophisticated databases and personalised marketing.</li>
<li>At the same time, it will make better use of real estate assets, investing ¥500 billion around Isetan Shinjuku alone.</li>
</ul>


Isetan Shinjuku expects to post sales in excess of ¥400 billion this year, a record for a single retail store, although most of the growth is from inbound tourists. 
But Isetan-Mitsukoshi is working to ensure longer term stability through more sophisticated databases and personalised marketing.
At the same time, it will make better use of real estate assets, investing ¥500 billion around Isetan Shinjuku alone.


Isetan-Mitsukoshi Bets on Flagships and Real Estate

<ul>
<li>We have long forecast the demise of regional department stores and the emergence of an elite group of luxury emporiums in big cities and this had been happening gradually. </li>
<li>Until the last year. Now the gap between the two is widening sharply, boosted in part by tourists flocking to big city stores, resulting in both record sales and profits.</li>
<li>At Matsuya Ginza for example, duty-free sales accounted for an historic 33% of sales last year. Further growth is expected.</li>
</ul>


We have long forecast the demise of regional department stores and the emergence of an elite group of luxury emporiums in big cities and this had been happening gradually. 
Until the last year. Now the gap between the two is widening sharply, boosted in part by tourists flocking to big city stores, resulting in both record sales and profits.
At Matsuya Ginza for example, duty-free sales accounted for an historic 33% of sales last year. Further growth is expected.


Japan

Takashimaya Company, Limited., founded in Kyoto in 1831, operates department stores.  The Company's main stores are located in Tokyo, Osaka, and Kyoto. Takashimaya also operates department stores in Paris, France, Singapore, China, Australia, and New York, USA.  The Company retails clothing, foods, art objects, sundry goods, and household utensils.  The Company also operates restaurants.

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Takashimaya (8233 JP)

Japan Morning Connection: Kose, 7&I, PPIH

Estee Lauder continues to struggle while those with less China exposure such as Kose look more attractive. Uncertainty over 7&I deal should lift...

Andrew Jackson

Japan Morning Connection: Asahi Intecc, PPIH

Positive results from Asahi Intecc show oversold potential; PPIH's steady outlook may indicate NKY225 cadidate; AMAT numbers showing decline in...

Andrew Jackson

Japan Morning Connection: 3099 JP, 1911 JP, 5803 JP

Expect a 'megaquake' reversal in stock names post-rotation due to earthquake warnings, retail rebound likely after strong 3099 1Q showing,...

Andrew Jackson

Isetan-Mitsukoshi Bets on Flagships and Real Estate

Isetan Shinjuku anticipates record sales exceeding ¥400 billion, while focusing on long-term stability and higher margins through improved...

Michael Causton

New Records For (Some) Dept. Stores

Regional department stores are declining while luxury emporiums in big cities are thriving, with a widening gap between the two due to tourist...

Michael Causton

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52-week Range

Market Cap (USDm)

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Japan Morning Connection: Kose, 7&I, PPIH

Estee Lauder continues to struggle while those with less China exposure such as Kose look more attractive. Uncertainty over 7&I deal should lift...

Andrew Jackson

Japan Morning Connection: Asahi Intecc, PPIH

​Positive results from Asahi Intecc show oversold potential; PPIH's steady outlook may indicate NKY225 cadidate; AMAT numbers showing decline in...

Andrew Jackson

Japan Morning Connection: 3099 JP, 1911 JP, 5803 JP

​Expect a 'megaquake' reversal in stock names post-rotation due to earthquake warnings, retail rebound likely after strong 3099 1Q showing,...

Andrew Jackson

Isetan-Mitsukoshi Bets on Flagships and Real Estate

​Isetan Shinjuku anticipates record sales exceeding ¥400 billion, while focusing on long-term stability and higher margins through improved...

Michael Causton

New Records For (Some) Dept. Stores

​Regional department stores are declining while luxury emporiums in big cities are thriving, with a widening gap between the two due to tourist...

Michael Causton

Positive results from Asahi Intecc show oversold potential; PPIH's steady outlook may indicate NKY225 cadidate; AMAT numbers showing decline in...

Expect a 'megaquake' reversal in stock names post-rotation due to earthquake warnings, retail rebound likely after strong 3099 1Q showing,...

Isetan Shinjuku anticipates record sales exceeding ¥400 billion, while focusing on long-term stability and higher margins through improved...

Regional department stores are declining while luxury emporiums in big cities are thriving, with a widening gap between the two due to tourist...