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Smartkarma Daily Briefs

Apr 16
0

Daily Brief Macro: UK: Green Shoots For Unemployment Wilt and more

By | Daily Briefs, Macro

In today’s briefing:

  • UK: Green Shoots For Unemployment Wilt
  • US Bear Market: BETWEEN DENIAL AND ANGER THERE IS “HOPE”
  • Steno Signals #193 – The USD Reset Is Underway
  • Asia base oils supply outlook: Week of 14 April
  • Singapore Enters Escalating Trade War on Soft Footing
  • Global base oils margins outlook: Week of 14 April
  • Americas/EMEA base oils demand outlook: Week of 14 April
  • India’s FDI Soars in ’25: In Up, Out Down!
  • Global base oils arb outlook: Week of 14 April
  • Stay Overweight Taiwan

UK: Green Shoots For Unemployment Wilt

By Phil Rush

  • Signs that statistical effects might lower the unemployment rate in the Spring have weakened, with stability at 4.4% now more likely amid stagnant underlying trends.
  • Levels remain healthy and redundancies are low despite falling vacancies, suggesting resilience survives rather than thrives. Rapid wage growth is more problematic.
  • Dovish hopes that excesses will break soon, aided by destructive US trade policy, keep the BoE on track to cut in May. Sterling strength also adds disinflationary space.

US Bear Market: BETWEEN DENIAL AND ANGER THERE IS “HOPE”

By David Mudd

  • The S&P bounced off its support level of 4800 and is now consolidating  on investor hopes that the worst is over as volatility declines.
  • As the economic numbers weaken and inflation accelerates from tariffs we expect the market to take its next leg down and enter a secular bear market.
  • As the economic numbers weaken and inflation accelerates from tariffs we expect the market to take its next leg down and enter a secular bear market.

Steno Signals #193 – The USD Reset Is Underway

By Andreas Steno

  • Morning from Copenhagen!It’s been a remarkable week—and weekend—in policy space.
  • On Friday, the White House released a list of exemptions from the reciprocal tariffs (including, for example, semiconductors).
  • Then, on Sunday, Trump “tweeted” that no exemptions were made, leaving Howard Lutnick once again to explain what was actually going on.

Asia base oils supply outlook: Week of 14 April

By Iain Pocock

  • Asia’s base oils prices surge relative to feedstock and gasoil prices.
  • Surge in margins include light-grade base oils, for which supply is more readily available.
  • Increasingly high margins and closed arbitrage to other markets by contrast points to tight supply.

Singapore Enters Escalating Trade War on Soft Footing

By Manu Bhaskaran

  • 1Q25 advanced estimates warn that the Singapore economy is entering the current unprecedented period of trade turmoil already burdened by broad signs of slowdown.
  • With inflationary pressures also moderating, the Monetary Authority of Singapore has aptly continued its monetary easing stance in its recent April review.
  • Still, with Singapore likely to be much more severely hit by the breakdown of the global rules-based order than others, a forceful fiscal response is needed to prevent a recession.

Global base oils margins outlook: Week of 14 April

By Iain Pocock

  • Global base oils prices rise sharply vs feedstock/gasoil prices.
  • Price premiums climb at time of year when they typically rise strongly in response to firmer supply-demand fundamentals.
  • Rise in price premiums in April 2025 coincides with slump in crude oil prices.

Americas/EMEA base oils demand outlook: Week of 14 April

By Iain Pocock

  • US base oils demand could face more pressure from concern about growing disconnect between base oils prices and crude oil and feedstock prices.
  • Widening base oil premium to feedstock and diesel prices points to sudden improvement in demand and tightening supply.
  • Timing of surge in base oils premium suggests it is linked more to slump in crude oil prices than to marked change in supply-demand fundamentals.

India’s FDI Soars in ’25: In Up, Out Down!

By Viral Kishorchandra Shah

  • Net FDI inflows hit USD 3.7B in Jan ’25, up from USD 2.3B, matching Aug ’24 after months of decline.
  • FDI outflows dropped to USD 2.1B, lowest since Jun ’22, driving the rebound despite lower gross inflows.
  • Apr-Jan ’24-25 net FDI fell 7.4% to USD 21.6B; tech and manufacturing led, per RBI and UNCTAD reports.

Global base oils arb outlook: Week of 14 April

By Iain Pocock

  • US base oils export price discount to Asia base oils prices stays wide so far this year.
  • Wide price discount facilitates shipment of surplus supplies to markets like India.
  • US base oils and lube exports to India surge in Feb 2025, reflecting that dynamic.

Stay Overweight Taiwan

By Sharmila Whelan

  • Taiwan stands out, despite facing in 90 days a 34% reciprocal tariff rate imposed by Trump. 
  • Corporate profits, investment and credit are all on the upswing, while the cost of capital remains extremely  indicating  that the business cycle has further to run.
  • The economy is firing on all cylinders:  domestic demand is rising strongly and so are exports.

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Apr 16
0

Daily Brief Quantitative Analysis: KRX Short Interest Weekly (Apr 11th): Lg Energy Solution and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • KRX Short Interest Weekly (Apr 11th): Lg Energy Solution, Sk Innovation, Hanmi Semi

KRX Short Interest Weekly (Apr 11th): Lg Energy Solution, Sk Innovation, Hanmi Semi

By Ke Yan, CFA, FRM

  • We analyzed the changes in short interest of KRX stocks as of Apr 11th which has an aggregated short interest worth USD5.0bn.
  • We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases & decreases in short value, short as multiple of ADT.
  • We highlight short interest changes in Lg Energy Solution, Sk Innovation, Hanmi Semi, Hd Hyundai Heavy Industries, Alteogen, Samsung Electronics, SK Hynix, Posco, Naver, Hana Financial.

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Apr 16
0

Daily Brief Private Markets: Featherless.ai secures US$5M to make AI inference faster and cheaper | e27 and more

By | Daily Briefs, Private Markets

In today’s briefing:

  • Featherless.ai secures US$5M to make AI inference faster and cheaper | e27

Featherless.ai secures US$5M to make AI inference faster and cheaper | e27

By e27

  • Featherless.ai, a US-based serverless AI inference platform, has raised US$5 million in seed funding.

  • The investment comes from a notable list of global investors, including Airbus Ventures, 500 Global, Kickstart Ventures, HF0, Panache Ventures, and Oakseed Ventures.

  • With the new funding, Featherless.ai intends to advance research and development into next-generation AI architectures to lower inference costs, potentially enabling AI deployment on lower-cost hardware.

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Apr 16
0

Daily Brief ECM: LG Electronics India IPO: The Bear Case and more

By | Daily Briefs, ECM

In today’s briefing:

  • LG Electronics India IPO: The Bear Case
  • Chagee IPO: Is It Worth the Risks? Peer Comparison and Valuation Analysis.
  • Lotte Global Logistics IPO – Thoughts on Peer Comp and Valuation
  • Pre-IPO BenQ BM Holding (PHIP Updates) – Some Points Worth the Attention

LG Electronics India IPO: The Bear Case

By Arun George

  • LG Electronics India (123D IN)/LGEIL, a subsidiary of LG Electronics (066570 KS), aims to raise up to US$1.5 billion through a secondary offering (15% of outstanding shares).
  • In LG Electronics India IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
  • The bear case rests on bottom-quartile revenue growth, revenue decline in the largest product category, dividends to the parent far exceeding FCF and significant share overhang.

Chagee IPO: Is It Worth the Risks? Peer Comparison and Valuation Analysis.

By Devi Subhakesan

  • Chagee Holdings (CHA US) ‘s IPO valuation discount to its peers, including HK-listed tea-beverage players as well as US-listed China-based coffee-beverage player, suggest a strong potential upside on listing.
  • US Investor concern over impact of tariffs and caution due to lingering memories of the Luckin Coffee scandal could translate to higher risk premium for the stock.
  • Expect Chagee to trade at a discount to budget beverage peers like Mixue Group (2097 HK) given its limited room for network expansion within China and likely slower overseas growth.

Lotte Global Logistics IPO – Thoughts on Peer Comp and Valuation

By Akshat Shah

  • Lotte Global Logistics (LGG KS) aims to raise around US$140m in its Korea IPO via selling a mix of primary and secondary shares.
  • Lotte Global Logistics is a logistics and shipping company engaged in a comprehensive logistics service business including courier service, land transportation, 3PL, port loading and unloading, and international logistics.
  • In our previous note, we looked at the firm’s past performance. In this note, we talk about the IPO valuations.

Pre-IPO BenQ BM Holding (PHIP Updates) – Some Points Worth the Attention

By Xinyao (Criss) Wang

  • The expansion space of BenQ is severely limited as the market has been saturated in Jiangsu Province. Due to DRG, future revenue/net profit growth would continue to be under pressure. 
  • Low profit margin of general hospitals is a common problem in this industry due to pain points of business model.It’s difficult to achieve improvement.Investors need to be aware of this.
  • BenQ’s valuation should be lower than Hygeia due to weaker profitability, smaller revenue scale, lower growth outlook.Post-money valuation before IPO of US$375 million (or about RMB2.7 billion) is already expensive

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Apr 16
0

Daily Brief Credit: Lucror Analytics – Morning Views Asia and more

By | Credit, Daily Briefs

In today’s briefing:

  • Lucror Analytics – Morning Views Asia

Lucror Analytics – Morning Views Asia

By Leonard Law, CFA

  • In today’s Morning Views publication we comment on developments of the following high yield issuers: Country Garden
  • In the US, the 1-year New York Fed inflation expectations edged up to 3.58% (3.26% e / 3.13% p).
  • Treasuries rallied yesterday, unwinding part of last week’s decline, after the Trump administration granted a temporary tariff reprieve on smartphones and consumer electronics.

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Apr 16
0

Daily Brief Thematic (Sector/Industry): Japan Morning Connection: Tech and AI Set to Drop on New NVDA Export Curbs and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Japan Morning Connection: Tech and AI Set to Drop on New NVDA Export Curbs
  • Furniture/Furnishings Weekly Recession Fears, Higher Rates, Tariffs…
  • A Defensive Portfolio Prepared For The Wealth Effect’s Reversal
  • Biopharma Week in Review : Pharma Tariffs Overhang; Worrying Vaccine Comments from RFK Jr.
  • Sustainable Investing Surveyor Focus on Blue Biofuels (BIOF): Breaks Ground in Florida

Japan Morning Connection: Tech and AI Set to Drop on New NVDA Export Curbs

By Andrew Jackson

  • Widespread weakness in tech/AI related plays after US curbs H20 exports setting a dour tone for JP SPE.
  • The US looking to suspend the SLR rule for Treasuries could see yields drop as banks do the work of the Fed.
  • HF’s zeroed in Suzuki secondary sparks squeeze and biggest volumes of the year.

Furniture/Furnishings Weekly Recession Fears, Higher Rates, Tariffs…

By Water Tower Research

  • Policy/tariff volatility, stock and bond market volatility, falling consumer and business confidence, stagflation fears, higher interest rates, tariffs, inflation concerns, and worries that the US may already be in a recession have dominated the headlines over the past week.
  • The WTR Commercial/Contract Furniture Index was up 0.4%, the Residential Manufacturers & Suppliers Index was up 2.9%, and the Home Goods Retailers Index was up 1.5% as the broader markets rebounded as well, with the S&P 500 and Dow 30 gaining 5.9% and the R2K up 2.6%

  • The Atlanta Fed suggests that the US may be in recession already (Figure 1), at least according to its GDPNow model, which aims to provide something closer to a real-time read on the state of the economy (1).

A Defensive Portfolio Prepared For The Wealth Effect’s Reversal

By Finimize Research

  • The US economy’s resilience hasn’t come from the many – it’s come from the top 10% as the “wealth effect” from rising asset prices has boosted spending.
  • But it works in reverse too.  Since the richest make up nearly half of America’s consumer spending, that could lead to a serious economic fallout.
  • It’s worth considering protecting your portfolio. I’ve pulled together one list of companies that should do well and another that could suffer from the change in climate.

Biopharma Week in Review : Pharma Tariffs Overhang; Worrying Vaccine Comments from RFK Jr.

By Water Tower Research

  • Biopharma lagged as Trump’s pending pharma tariffs loom.
  • The 90-day pause in reciprocal tariffs was a short-lived reprieve for biopharma, as Trump later clarified pharma tariffs were not part of the pause.
  • After a second unvaccinated child died from measles (three deaths total), RFK Jr. endorsed the vaccine as the most effective way of prevention. 

Sustainable Investing Surveyor Focus on Blue Biofuels (BIOF): Breaks Ground in Florida

By Water Tower Research

  • The WTR Sustainable Index was up 3.4% W/W versus the S&P 500 Index (up 5.7%), the Russell 2000 Index (up 1.8%) and the Nasdaq Index (up 7.4%).
  • Energy Technology (12.6% of the index) was up 1.6%, while Industrial Climate and Ag Technology (45.7% of the index) was up 5.0%, ClimateTech Mining was up 1.1%, and Advanced Transportation Solutions (21.5% of the index) was up 3.3%.
  • Top 10 Performers: ALTA, FGPHF, AVL, VGAS, VIHD, LNZA, FHYD, OPTT, GWTI, LIDR

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Apr 16
0

Daily Brief Technical Analysis: Expecting SPX Rally to Fizzle at 5490-5500 or 5785; Still Bearish/Cautious and Defensive and more

By | Daily Briefs, Technical Analysis

In today’s briefing:

  • Expecting SPX Rally to Fizzle at 5490-5500 or 5785; Still Bearish/Cautious and Defensive

Expecting SPX Rally to Fizzle at 5490-5500 or 5785; Still Bearish/Cautious and Defensive

By Joe Jasper

  • Since late-February(2/25/25) we were expecting an 8-10% pullback to provide a buying opportunity.However,after getting the 10%+ pullback, we discussed 4/1/25 that we no longer saw it as a buying opportunity
  • We downgraded our outlook to bearish/cautious. We then discussed last week(4/8/25)how it was a logical spot for a local bottom to develop at 4800-4820 on SPX and $402-$412 on QQQ. 
  • A rally sparked from there, but we now are looking for SPX rally to fizzle, either here at 5490-5500 (20-day MA) or the 200-day MA (currently 5754) or 5785 level

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Apr 16
0

Daily Brief Event-Driven: The Skew in the Tsuruha-Welcia-Aeon Combination and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • The Skew in the Tsuruha-Welcia-Aeon Combination
  • Know Your Rare Earth Elements As China Restricts Exports
  • Horizon Robotics IPO Lockup- US$7bn Expiry with Scattered Shareholding and Lots of CCASS Movement
  • Consolidating Yield: LondonMetric’s Possible Offer for Urban Logistics
  • A Note-Worthy Exit: Atlas Takes Over De La Rue

The Skew in the Tsuruha-Welcia-Aeon Combination

By Travis Lundy

  • Tsuruha Holdings (3391 JP), Welcia Holdings (3141 JP), and Aeon Co Ltd (8267 JP) announced their deal whereby Tsuruha merges with Welcia in December, and Aeon gains control of MERGECO.
  • Orbis Investments – owner of 9.7% of shares out – complained. I think with good reason. Tsuruha is trading a little expensive to the ratio, but there’s 7.5mos to go. 
  • Interestingly, there’s real skew on this trade. It’s not overly complicated, and it is worthwhile thinking about it.

Know Your Rare Earth Elements As China Restricts Exports

By David Blennerhassett

  • China recently escalated restrictions on the export of rare earths. Not just to the US as the two global players go toe-to-toe on tariffs; but to all countries.
  • China’s latest round of restrictions target critical materials used in defense, electronics, and EVs.
  • Apart from China, the world’s largest refining – not just the largest miner – who else refines rare earth elements, specifically heavy rare earths?

Horizon Robotics IPO Lockup- US$7bn Expiry with Scattered Shareholding and Lots of CCASS Movement

By Sumeet Singh

  • Horizon Robotics (9660 HK) raised around US$800m in its Hong Kong IPO in October 2024. The lockup on its pre-IPO investors is set to expire soon.
  • Horizon Robotics (HR) is a provider of advanced driver assistance systems (ADAS) and autonomous driving (AD) solutions for passenger vehicles, empowered by its proprietary software and hardware technologies.
  • In this note, we will talk about the lockup dynamics and possible placement.

Consolidating Yield: LondonMetric’s Possible Offer for Urban Logistics

By Jesus Rodriguez Aguilar

  • Strategic merger between LondonMetric and Urban Logistics offers scale, diversification, and internal management benefits, with a modest premium to pre-announcement price and meaningful potential for operational synergies and cost savings.
  • Scheme of arrangement could complete by July 2025 if approved; long-term investors may benefit from enhanced dividend yield, greater liquidity, and sustained growth in logistics-focused real estate under unified management.
  • Long SHED at 138.6p to capture 8.1% gross spread; attractive upside with manageable downside risk and strong board support; reassess on firm offer announcement by 9 May 2025.

A Note-Worthy Exit: Atlas Takes Over De La Rue

By Jesus Rodriguez Aguilar

  • Atlas’s offer for perennial takeover target De La Rue PLC (DLAR LN) is underpinned by a historic brand, strong order book, and post-sale cash buffer, with pension resolution and execution certainty.
  • The £263m all-cash bid implies a 12.47x EV/EBITDA multiple, offering shareholders a 130p exit, cum-dividend, strong execution certainty, and over 40% committed shareholder support.
  • With 91.7% market-implied completion probability and an annualized return of 4.5% at 128.5p, the deal presents an attractive, de-risked arbitrage opportunity with limited downside and credible upside closure.

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Apr 16
0

Daily Brief Equity Bottom-Up: China’s Export Restrictions on Rare Earth Minerals – Key Impact on Korean Companies and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • China’s Export Restrictions on Rare Earth Minerals – Key Impact on Korean Companies
  • Takashimaya (8233 JP): Full-year FY02/25 flash update
  • TSMC (2330.TT; TSM.US): Key Questions for TSMC 1Q25 Earnings Conference
  • China Pair Trade: Long SITC Intl (1308 HK), Short OOIL (316 HK)
  • Anglo American: Initiation of Coverage- Copper Production Expansion & Optimization Driving Our Optimism!
  • Intel Offloads Altera Majority Stake At Steep Discount
  • MOIL Ltd: Plans to Double Output Well Supported
  • Keepers Holdings (KEEPR PM) Concall Highlights: Solid Q4 2024, Growth Unabated In FY25
  • Asia Real Estate Tracker (15-Apr-2025): HK Admiralty office floor sells at 17-year low.
  • Associated British Foods: Initiation of Coverage- Automation & Labor Efficiency As A Pivotal Factor Driving Growth!

China’s Export Restrictions on Rare Earth Minerals – Key Impact on Korean Companies

By Douglas Kim

  • In this insight, we discuss some of the key beneficiaries in Korea that could actually stand to gain from such export restrictions. 
  • We also discuss other Korean companies that could be negatively impacted by this move by the Chinese government. 
  • Despite the uncertainties related to China’s export restrictions of rare earths minerals, we do not expect sudden collapse of the entire semiconductor and EVs value-chain in Korea.

Takashimaya (8233 JP): Full-year FY02/25 flash update

By Shared Research

  • Total operating revenue for FY02/25 was JPY1.03tn, up 8.5% YoY, with operating profit at JPY57.5bn, up 25.2%.
  • Domestic and Overseas Department Stores, along with Finance and Contract and Design segments, drove YoY revenue and profit growth.
  • FY02/26 forecast anticipates revenue and profit growth, led by Domestic and Overseas Department Store segments, despite some segment challenges.

TSMC (2330.TT; TSM.US): Key Questions for TSMC 1Q25 Earnings Conference

By Patrick Liao

China Pair Trade: Long SITC Intl (1308 HK), Short OOIL (316 HK)

By Osbert Tang, CFA

  • A “Long SITC Intl (1308 HK), Short OOIL (316 HK)” pair trade should benefit from the more resilient intra-Asia trade and capture the tariff-induced challenges on Trans-Pacific trade. 
  • OOIL derived 28.3% of its volume and 38.7% of its revenue from the Trans-Pacific route in 1Q25. Instead, SITC generated 100% of its revenue from the Asian market.
  • While OOIL’s 0.7x P/B is cheaper than SITC’s 2.5x, its FY25 ROE of 10.6% is lower than SITC’s 34.6%. SITC’s dividend yield is also trending up, against OOIL’s down.

Anglo American: Initiation of Coverage- Copper Production Expansion & Optimization Driving Our Optimism!

By Baptista Research

  • The 2024 results for Anglo American highlight a year marked by strategic shifts and operational execution, albeit with mixed outcomes.
  • Safety remains a priority, yet the company faced three fatalities, underscoring ongoing safety challenges.
  • Leadership changes have impacted the structure, with board addition Anne Wade contributing her expertise to strategic committees.

Intel Offloads Altera Majority Stake At Steep Discount

By William Keating

  • Intel yesterday announced that it was selling a 51% stake of its Altera business to Silver Lake for $4.46 billion
  • The deal values Altera at $8.75 billion, roughly half what Intel paid to acquire the company over a decade ago
  • Altera’s CEO, Intel veteran Sandra Rivera, will be replaced with a new CEO, Raghib Hussain, formerly president of Products and Technologies at Marvell

MOIL Ltd: Plans to Double Output Well Supported

By Rahul Jain

  • MOIL is India’s largest manganese ore producer, contributing over 50% of the country’s production. Its dominant position provides a competitive advantage in meeting domestic demand.
  • Planned a capex of Rs24 billion until FY30. This investment will support brownfield expansions, greenfield projects, and modernization efforts, including shaft-sinking projects at Balaghat and Gumgaon mines.
  • Valuations: Trades at a marginal premium to historic valuations. Debt-free balance sheet, 25yr+ mine life gives confidence over LT execution of expansion plans.

Keepers Holdings (KEEPR PM) Concall Highlights: Solid Q4 2024, Growth Unabated In FY25

By Sameer Taneja

  • The Keepers Holdings (KEEPR PM)  reported Q4 2024 revenues/profits of 11.8%/23.5% YoY. Based on current trends, they provided a  outlook for FY25.
  • For FY24, the company reported 13.6%/21.3% YoY revenue/profit growth, led by a 14% YoY expansion in volumes. The company declared a 0.12 peso/share dividend (~4.7% dividend yield).
  • Trading at 10.6x FY24 PE, net cash, >20% ROE, and a 4.7%  dividend yield based on a 50% payout is a structural play on the premiumization of alcohol consumption.

Asia Real Estate Tracker (15-Apr-2025): HK Admiralty office floor sells at 17-year low.

By Asia Real Estate Tracker

  • Hong Kong office floor in Admiralty sells at a 17-year low, reflecting challenging market conditions in the region.
  • Brookfield strengthens APAC logistics presence with $588M NZ joint venture, highlighting growth opportunities in the sector.
  • Manulife IM acquires Sydney Logistics Park from KKR and Centennial for $35M, expanding their real estate portfolio in Australia.

Associated British Foods: Initiation of Coverage- Automation & Labor Efficiency As A Pivotal Factor Driving Growth!

By Baptista Research

  • Associated British Foods (ABF) has reported a robust financial performance for the 52 weeks ending 14th September 2024, highlighted by substantial profit and cash flow improvements across its diversified portfolio.
  • Operating profit witnessed a 38% increase, with adjusted earnings per share climbing by 39%.
  • Cash generation rose to GBP 1.4 billion, marking an increase of GBP 1.1 billion from the previous year, which signifies positive operational and financial strides.

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Apr 16
0

Daily Brief Japan: Tsuruha Holdings, JX Advanced Metals, Fast Retailing, Takashimaya, Demae-Can Co., Ltd., Serverworks, Vector Inc, FP Partner, LIFULL, San Holdings and more

By | Daily Briefs, Japan

In today’s briefing:

  • The Skew in the Tsuruha-Welcia-Aeon Combination
  • The End-April TOPIX Rebalance – US$2.1bn a Side
  • Fast Retailing (9983 JP): More Capping-Led Selling in September (And Maybe More in March)
  • Takashimaya (8233 JP): Full-year FY02/25 flash update
  • Demae-Can Co., Ltd. (2484 JP): 1H FY08/25 flash update
  • Serverworks (4434 JP): Full-year FY02/25 flash update
  • Vector Inc (6058 JP): Full-year FY02/25 flash update
  • FP Partner (7388 JP): Q1 FY11/25 flash update
  • Lifull (2120 JP) – HOME’S Services Segment Delivers Steady Performance…
  • San Holdings (9628 JP) – Century-Strong Enterprise Focused on Growth

The Skew in the Tsuruha-Welcia-Aeon Combination

By Travis Lundy

  • Tsuruha Holdings (3391 JP), Welcia Holdings (3141 JP), and Aeon Co Ltd (8267 JP) announced their deal whereby Tsuruha merges with Welcia in December, and Aeon gains control of MERGECO.
  • Orbis Investments – owner of 9.7% of shares out – complained. I think with good reason. Tsuruha is trading a little expensive to the ratio, but there’s 7.5mos to go. 
  • Interestingly, there’s real skew on this trade. It’s not overly complicated, and it is worthwhile thinking about it.

The End-April TOPIX Rebalance – US$2.1bn a Side

By Travis Lundy

  • This year there are 10 Free Float Weight Changes for April. There are 20 Liquidity Factor Changes, 2 Inclusions, and 3 M&A-related downweights. There are 90+ Share Count Change Downweights.
  • This is a bigger Big April Basket than normally comes around. And there are some big flows. All trades are 28 April at the close.
  • Total flow is ~US$2.1bn a side. 64 trades of >2 days of ADV, and of those, 27 with >US$10mm to trade (7 of US$50mm+). Top 20 in USD average 5dADV.

Fast Retailing (9983 JP): More Capping-Led Selling in September (And Maybe More in March)

By Brian Freitas

Takashimaya (8233 JP): Full-year FY02/25 flash update

By Shared Research

  • Total operating revenue for FY02/25 was JPY1.03tn, up 8.5% YoY, with operating profit at JPY57.5bn, up 25.2%.
  • Domestic and Overseas Department Stores, along with Finance and Contract and Design segments, drove YoY revenue and profit growth.
  • FY02/26 forecast anticipates revenue and profit growth, led by Domestic and Overseas Department Store segments, despite some segment challenges.

Demae-Can Co., Ltd. (2484 JP): 1H FY08/25 flash update

By Shared Research

  • Revenue was JPY20.9bn, a decrease of 18.3% YoY, with operating and recurring losses both at JPY1.3bn.
  • Gross merchandise value was JPY84.8bn, down 13.1% YoY, with 30.4mn orders and 4.92mn active users.
  • GPM improved to 20.3% for 1H, with operating expenses totaling JPY12.3bn, reflecting cost optimization efforts.

Serverworks (4434 JP): Full-year FY02/25 flash update

By Shared Research

  • Serverworks’ FY02/25 revenue was JPY35.7bn (+29.8% YoY), exceeding forecasts with a 100.4% achievement rate.
  • Cloud Integration revenue reached JPY2.3bn (+23.7% YoY), driven by demand for cloud transitions and hybrid strategies.
  • Resale services revenue was JPY23.3bn (+34.0% YoY), supported by increased AWS usage and new customer acquisitions.

Vector Inc (6058 JP): Full-year FY02/25 flash update

By Shared Research

  • Revenue reached JPY59.3bn (+0.1% YoY), with operating profit at JPY8.0bn (+15.7% YoY), and net income at JPY4.2bn (-10.4% YoY).
  • PR and Advertising segment saw significant profit increase due to reversal of doubtful accounts provisions, despite flat revenue.
  • Direct Marketing business impacted by food safety concerns, resulting in lower revenue and profit, despite record high sales recovery.

FP Partner (7388 JP): Q1 FY11/25 flash update

By Shared Research

  • Revenue for Q1 FY11/25 was JPY8.3bn, flat YoY, with operating profit at JPY798mn, down 41.5% YoY.
  • The number of sales representatives increased to 2,546, while policy transfer agreements decreased to 4,981, down 27,362 YoY.
  • New policies totaled 56,931, down 1.1% YoY, with new customers at 35,339, up 0.7% YoY.

Lifull (2120 JP) – HOME’S Services Segment Delivers Steady Performance…

By Sessa Investment Research

  • FY2025/9 Q1 Results Review: In Q1 FY2025/9, LIFULL Co., Ltd. (hereafter, the Company) reported net sales of JPY 8,367 mn, up 2.2% YoY, driven by growth in the HOME’S Services segment.
  • Operating profit turned positive at JPY 652 mn, thanks to higher sales in the HOME’S Services segment as well as cost-cutting efforts, particularly in the Overseas segment.
  • In the HOME’S Services segment, sales rose 7.7% YoY and operating profit grew 24.2% YoY, due to growth in the Company’s client network and average revenue per agent (ARPA) driven by a stronger sales efforts and improved user interface (UI) and experience (UX). 

San Holdings (9628 JP) – Century-Strong Enterprise Focused on Growth

By Astris Advisory Japan

  • SAN HOLDINGS is the largest domestic pure-play End-of-Life service provider, with a network of 262 funeral halls spanning 15 prefectures in Japan.
  • Despite the unmistakable demographic tailwind, intensifying competition has resulted in the company accelerating its strategic growth priorities with the landmark acquisition of peer Kizuna Holdings in September 2024.
  • Approaching its centenary in FY3/32, the company plans to build a nationwide operation fuelled by M&A and to expand its service offering.

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