In today’s briefing:
- Fy23 GPIF Results and Portfolio Changes – Outlook for FY24
- Timee (215A JP) IPO: Valuation Insights
- Timee Pre-IPO – Thoughts on Valuation – Primed for a Decent Upside at the Current Range
- ECM Weekly (8th July 2024) – Japan Cross-Shareholding, Honda, Aisin, Timee, Chenqi, Cirrus, Emcure
- The Key to Higher ROE Is Higher Profit Margins and Faster Efforts by Smaller Companies
Fy23 GPIF Results and Portfolio Changes – Outlook for FY24
- Last year, the GPIF as a whole returned 22.67% in yen terms. As a whole, GPIF outperformed its benchmarks by 0.04% after paying 0.02% in fees and costs.
- GPIF traded ¥30trln of assets – relatively high turnover for a fund which espouses very low turnover – but there’s a reason for that. There were also sharp active/passive moves.
- This year is the last year in the “cycle” of the “old” Policy Allocation Framework. A new one is likely to be introduced this year.
Timee (215A JP) IPO: Valuation Insights
- Timee Inc (215A JP), a leading part-time job platform in Japan, is seeking to raise up to US$286 million. Book-building runs from 9 to 23 July.
- We previously discussed the IPO in Timee (215A JP) IPO: The Bull Case and Timee (215A JP) IPO: The Bear Case.
- In this note, we discuss valuation. Our analysis suggests that Timee is attractively valued at the IPO price range in the context of the forecasted growth.
Timee Pre-IPO – Thoughts on Valuation – Primed for a Decent Upside at the Current Range
- Timee Inc (215A JP) is looking to raise US$290m in its Japan IPO. The IPO will be a 100% secondary selldown by existing shareholders.
- Timee operates an on-demand staffing platform that connects part-time jobseekers with businesses in Japan.
- In an earlier note, we looked at the firm’s past performance and peer comparison. In this note, we discuss our thoughts on valuation.
ECM Weekly (8th July 2024) – Japan Cross-Shareholding, Honda, Aisin, Timee, Chenqi, Cirrus, Emcure
- Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
- On the IPO front, we looked at the recently launced offerings of Timee Inc , Chenqi Technology Limited and Cirrus Aircraft.
- On the placement front, this week too was dominated by the cross-shareholding unwinds, this time in Honda Motor (7267 JP).
The Key to Higher ROE Is Higher Profit Margins and Faster Efforts by Smaller Companies
- Since TSE’s request, more companies have used ROE or ROIC as KPIs in mid-term management plans, but even now, more companies only indicate targets for sales, operating profit, etc.
- Larger companies have been the first to raise ROE; the key will be for smaller companies, which have been slower to improve their ROE, to raise their ROE.
- Many companies have only just begun to reduce their policy shareholdings and strengthen shareholder returns, and are still in the process of addressing the core issue of increasing profit margins.
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