Japan

• Today after the close, Hakuhodo Dy Holdings (2433 JP) announced changes to the terms of its Tender Offer for Digital Holdings Inc (2389 JP), which faces an overbidder in SilverCape. 
• Hakuhodo had bid ¥1,970. Silvercape came over the top with a proposed ¥2,380 but a delay for approvals. DH is fighting against SilverCape because of “remaining minority shareholder risk.”
• That’s garbage. Utter blatherskite. Trumpworthy trumpery. Now Hakuhodo DY has lowered the minimum threshold making it hard to miss, and raised the price 2.3% to ¥2,015.

• Yesterday saw the announcement of a secondary offering structured like a delayed pricing ABO.
• 1.5mm shares which is 7.5% of shares out, 25% of Max Real World Float, and 9 days of ADV. There’s more cross-holdings to come out later at some point.
• Though it is not particularly expensive, Momentum is not this stock’s friend right now.

• Hakuhodo Dy Holdings (2433 JP) increased its Digital Holdings Inc (2389 JP) tender offer price by 2.3% to JPY2,015, 7.1% below the last close and 15.3% below SilverCape’s JPY2,380 offer.
• The lower limit has been reduced to a 24.67% ownership ratio. Hakuhodo’s confidence in passing the EGM share consolidation vote relies on AGM voting trends and passive votes.
• Hakuhodo’s acceptances as of 28 October exceed the lower limit. The revised Hakudodo offer will severely dent the chances of SilverCape’s offer.

• The Tsuruha-Welcia merger creates Japan’s largest drugstore alliance, poised for long-term growth and market dominance, driven by an expected JPY 50B in synergies over three years.
• A two-step corporate action—share exchange (Dec 1, 2025) followed by an Aeon TOB—provides structural certainty and strategic backing, securing the combined entity’s market leadership.
• These catalysts establish a large market leader in the consumer staples space, suggesting a timely opportunity to gain exposure to the new entity.

• SBI Shinsei Bank (8303 JP), a Japanese financial institution, aims to raise around US$2bn in its Japan listing.
• SBI Shinsei Bank (SBISB) is a Japanese financial institution providing a range of financial products and services to both individual and institutional customers.
• In this note, we talk about the positive aspects of the deal.

• Internet Initiative Japan (IIJ) is a pioneering Japanese IT services provider, well-positioned to capitalize on the country’s accelerating digital transformation. Its core strengths lie in its robust network infrastructure and a comprehensive suite of services spanning connectivity, cloud, and systems integration.
• The company is experiencing solid growth, driven by strong demand for cloud services and large-scale network projects. The mid-term plan targets continued revenue and profit expansion by deepening relationships with its large enterprise and government client base through integrated service offerings.
• While competition from domestic telecoms and global cloud giants is a key challenge, IIJ’s established reputation for reliability, advanced technological capabilities, and loyal customer base provide a solid foundation for sustained growth. However, recent cybersecurity incidents highlight the operational risks inherent in the business.

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• Positioned to rebuild – FY9/25 results saw MRI record YoY revenue growth for the first time in two years, profit growth for the first time in three years, and a record-high GPM of 23.7% driven by high consultant utilization.
• Earnings visibility is improving, driven by strong order growth (+19.4 % YoY at TTC) and a rising backlog.
• However, we believe FY9/26 guidance indicates management’s priority is to rebuild the business, with key initiatives to expand the concentration domains in TTC (electric power and energy, medical and long-term care, business analytics and AI) and the growth area in ITS (public and electric power, HR and education, financial, DA and AI). 

• Kaken Pharmaceutical (4521 JP) reported rather underwhelming earnings in H1FY26, with revenue, operating profit and net profit witnessing significant drop as upfront payments received last fiscal put pressure.
• Kaken’s major drug Clenafin saw revenue rise 1.5% to ¥9.3B on AG launch, while Ecclock helped drive revenue growing 12% YoY to ¥1.5B.
• FY26 guidance revised downwards to ¥86.3B (down 8% YoY). Kaken needs an immediate strong revenue driver to rescue it from pangs of drug price revision and generic competition.

• ROHM Co Ltd (6963 JP) ‘s strong performance in H1 FY25 is overshadowed by weak guidance for H2 FY25.
• We expect H2 FY25 to be a pause in the structural reform journey, and the details are discussed in this insight.
• Trading at just 0.8x P/B, we continue to like the name and remain optimistic about the second Mid-Term Management Plan; details are shared in this insight.

Key points (machine generated)

• Ichigo Co., Ltd. reported a 64.3% increase in operating profit to 11,261 million yen for the interim period ending February 2026.
• Sales rose by 40.6% to 51,024 million yen, driven by strong stock and flow revenue.
• The company focuses on real estate value enhancement and renewable energy, aiming for record profits in the current fiscal year.

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• A month ago I wrote [Japan Activism/M&A] – Closing In On the Tsuruha Partial Tender – Likely Needs To Be Higher. Now we are <2wks to the deal.  
• At the time, I said the Partial Tender Offer Price needed to be higher than the mooted ¥2,280. Tsuruha Holdings (3391 JP) shares are up 10.0% in that month. 
• The three largest peers are -2.0% on average in that period. The average of 8 peers is +0.5%. I still expect the partial offer price needs to be near ¥3,100

• United Urban Investment (8960 JP) is looking to raise US$155m in a primary placement.
• The purpose is for financing of its medium-term growth strategy plan which includes the acquisition of new assets.
• In this note, we will talk about the placement and run the deal through our ECM framework.

• Japan’s Q3 GDP shrank 1.8% vs forecast 2.5% (annualised), while consumption slowed to 0.1%. This is the first contraction in six quarter.
• The cause is the drop in exports in the face of U.S. tariffs, automakers in particular plummeted, following a period of hiking exports before tariffs came into effect.
• We’ve consistently flagged the Nikkei 225 (NKY INDEX) as overbought. This tactical short-term analysis pinpoints critical support (and resistance, but we think the index may fall).

• Yesterday post-close, Sakata Inx Corp (4633 JP) announced a ¥6bn+ selldown offering by financial crossholders. There may be others to come, but not clear how much.
• The company has had a good couple of years, the stock has reached book value. Optimised balance sheet ROE now clears 10%.
• Index impact is limited in all respects. Low vol, low multiple, decent dividend, high earnings progression on decent business growth are all positive factors. 

• We were correct not buying at a 51 FPE (at the top), despite our bullish view on their oncology portfolio of drugs.
• With hindsight, we were early at the end Oct 2024 at 39 FPE – numbers disappointed and the counter derated significantly.
• At a 16.5 FPE, expectations are very different. Enhertu has moved from strength to strength and has just achieved its first billion dollar quarter.

• Celsys reported cumulative Q3 FY12/25 sales of JPY7.0bn (+15.9% YoY), operating profit of JPY2.2bn (+39.0% YoY).
• Celsys revised FY12/25 forecast: sales JPY9.3bn, operating profit JPY2.9bn, net income JPY1.4bn, citing strong subscription growth.
• Creator Support segment sales JPY6.0bn (+19.4% YoY), driven by CLIP STUDIO PAINT upgrades and global expansion efforts.

• Canon Electronics is strategically pivoting towards high-growth sectors, including satellite technology and medical components, leveraging its core competencies in precision optics and electronics to diversify revenue streams beyond its traditional markets.
• The company demonstrates a solid financial position with consistent revenue growth, improving profitability, and a strong operating cash flow generation, enabling investments in R&D and strategic initiatives.
• While the company shows promising growth in new ventures, it faces challenges from intense competition in the electronics industry and potential margin pressures from fluctuating raw material costs and supply chain dynamics.

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• Allegro MicroSystems reported its second quarter fiscal 2026 earnings, showcasing robust financial performance and strategic gains, particularly in the automotive and data center markets.
• The company achieved net sales of $214 million, depicting a 5% sequential increase and a 14% year-over-year growth.
• The gross margin was recorded at 49.6%, with a non-GAAP earnings per share of $0.13, both exceeding the company’s guided ranges.

• CYND is a dominant, founder-led Vertical Market Software (VMS) provider for Japan’s beauty salon industry, capitalizing on the nationwide push for digital transformation.
• The company exhibits a strong growth profile, evidenced by a 3-year revenue CAGR of 27.2%, but has faced significant net income volatility and margin compression in recent years.
• While the stock appears inexpensive on some metrics and operates in a secularly growing niche, its small size, limited liquidity, and lack of sell-side coverage present notable risks for institutional investors.

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• Izumi is joining the race to buy up more of Japan’s food and FMCG retail share. 
• Currently one of the dominant players in Kyushu, Izumi says it will use M&A to increase store numbers over the next decade.
• This will also mean pivoting more towards food rather than its traditional GMS format just like its competitors.

• SBI Shinsei Bank (8303 JP)‘s listing has been approved by the JPX and the stock is expected to start trading on the Prime Market from 17 December.
• At the indicated IPO price of ¥1,440/share, the IPO will raise up to ¥367.6bn (US$2.38bn) and value SBI Shinsei Bank (8303 JP) up to ¥1,290bn (US$8.34bn).
• The stock should be added to the TOPIX INDEX at the close on 29 January while inclusion in global indices should take place in May and June.

• I summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads: Mayne Pharma (MYX AU), Smart Share Global (EM US), AUB Group Limited (AUB AU), Dongfeng Motor (489 HK), ENN Energy (2688 HK), Digital Holdings Inc (2389 JP).
• Lowest spreads: Bright Smart Securities (1428 HK), Mandom Corp (4917 JP), Seven West Media (SWM AU), Pacific Industrial (7250 JP), Toyota Industries (6201 JP), Jinke Smart Services (9666 HK). 

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments: CNGR Advanced Material (2579 HK) prices at the low end of the range, Klook (KLK US) seeks to raise US$400 million.
• Event-Driven developments: Pacific Industrial (7250 JP), Forum Engineering Inc (7088 JP), Fujitec Co Ltd (6406 JP), Itochu Shokuhin (2692 JP), Maruwn Corp (9067 JP), Star Micronics (7718 JP). 

• Context: This Insight follows up on previously highlighted relative value opportunities, using a statistical methodology based on mean-reversion to identify opportunities in paired securities.
• Highlights: Currently ten pair trade opportunities across four markets and four sectors persist.
• Why read: Statistical analysis offers a unique perspective on relative value. Gain insights into actionable statistical pair trade opportunities and monitor performance of previously highlighted pairs.

• Leading Market Position in a Resilient Sector: Toho is a dominant player in Japan’s food service distribution industry, a sector characterized by stable, albeit low-margin, demand. Its comprehensive business model, encompassing distribution, cash & carry, and food solutions, provides a significant competitive advantage.
• Strategic Growth Initiatives Driving Profitability: The company’s mid-term management plan, ‘SHIFT-UP 2027,’ focuses on key growth areas including expansion in the Greater Tokyo Area, increasing the share of higher-margin private brand (PB) products, and pursuing strategic M&A, which are expected to enhance profitability.
• Attractive Shareholder Returns and Valuation: Toho demonstrates a strong commitment to shareholder returns, targeting a 40% dividend payout ratio. The stock trades at a compelling valuation relative to its peers, supported by robust growth in earnings and dividends over the past three years.

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• Dominant integrated entertainment enterprise in Japan, underpinned by a powerful intellectual property (IP) portfolio, most notably the globally recognized ‘Godzilla’ franchise.
• Clearly defined growth strategy, “TOHO VISION 2032,”focuses on strengthening its four core pillars (Film, Theatre, Real Estate, and Anime), with a significant emphasis on international expansion and digital innovation.
• Stable financial performance is augmented by the lucrative and less volatile Real Estate division, providing a solid foundation for investments in the inherently cyclical content creation business.

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• Since TSE’s request, many companies have introduced share buybacks as a measure, and as a result of investors demanding accountability for how these shares are used, share cancellations have increased.
• Companies that frequently cancel treasury stock demonstrate superior capital profitability. Companies with high capital profitability also exhibit strong scores in growth strategy, cash holdings, dividend policy, and treasury stock cancellation.
• More companies are expected to consider cash allocation within overall goal of enhancing corporate value, encompassing growth strategy, cash holding policy, and dividend policy, in order to improve capital profitability.

• Industry Leader with Diversified Operations: Fukushima Galilei is a leading Japanese manufacturer of commercial and industrial refrigeration systems, with a strong market presence in the food service, retail, and medical sectors. The company is diversifying its business by expanding into non-food areas like pharmaceuticals and semiconductors, leveraging its core temperature control technology.
• Solid Financial Performance and Growth: The company has demonstrated a consistent track record of revenue and net income growth, supported by strong demand in its core markets. Recent financial results show continued positive momentum, with double-digit growth in sales and operating profit, leading to a positive revision of the fiscal year forecast.
• Commitment to Sustainability and Innovation: Fukushima Galilei is proactively investing in environmentally friendly technologies, such as CO2-based refrigeration systems and energy-efficient products. The company’s focus on R&D and innovation, highlighted by its ‘MILAB’ open innovation base, positions it to capitalize on future industry trends toward sustainability and automation.

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• ROHM is demonstrating a significant turnaround, returning to profitability in Q1FY25 after a challenging FY2024, driven by structural reforms, improved demand, and cost controls.
• The company is a key player in the high-growth Silicon Carbide (SiC) power semiconductor market, which is critical for electric vehicles (EVs) and energy-efficient applications, representing a major growth catalyst.
• Despite the positive outlook, the stock trades at an attractive valuation of approximately 0.8x Price-to-Book, though it faces significant risks from macroeconomic headwinds, weak demand in China, and geopolitical tensions.

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• Monex Group is strategically positioned at the intersection of traditional online brokerage and the high-growth crypto-asset market through its key subsidiary, Coincheck. This dual focus offers a diversified revenue stream but also exposes the company to significant market volatility.
• The company’s financial performance is highly sensitive to cryptocurrency market fluctuations, as evidenced by volatile earnings and a recent net loss attributed to one-time costs for Coincheck’s Nasdaq listing. However, core operations in Japan and the U.S. remain profitable, supported by strategic partnerships and growing assets under management.
• Facing intense competition and a zero-commission trend in the Japanese online brokerage industry, Monex is focused on expanding its crypto-asset business globally and growing its asset management segment to drive future growth and enhance shareholder value, underscored by a strong dividend payout.

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• TSE has approved the relisting of SBI Shinsei Bank (8303 JP), which is scheduled to go public on 17 December 2025 with an anticipated market cap of $8.4bn.
• SBI Shinsei Bank (8303 JP) is forecasted to achieve fast-entry in one Global index in December.
• SBI Shinsei Bank (8303 JP) may be included in the other Global index at the next review, subject to float cap risk.

• On 14 November, media outlets reported that Sapphireterra has sent a letter to the Itochu Shokuhin (2692 JP) Board suggesting two strategic alternatives to improve shareholder returns. 
• Sapphireterra has suggested that Itochu Corp (8001 JP) privatise Itochu-Shokuhin at JPY14,000, a 50.5% takeover premium. Due to the shareholder structure, Itochu does not need to be this generous.
• Sapphireterra has also alternatively suggested JPY7,000 special dividend. The strong YTD share performance suggests no pressing need for the Board to act on this proposal. 

• Elliott ups its stake in Toyota Industries (6201 JP) and considers the proposed Offer to be significantly undervalues the company. 
• No matter how you slice it, Zijin Mining Group Co Ltd H (2899 HK)is trading rich. Zijin Gold (2259 HK) is trading even richer. 
• Is Genting  (GENT MK)‘s low-balled Offer for Genting Malaysia (GENM MK) all about securing statutory control; or is there scope for a bump now that the transaction has turned unconditional? 

• The Pacific Industrial (7250 JP) “MBO” was egregiously mis-priced. I was surprised the family did it but on 23 October, they increased their bid by 42.4%, from ¥2,050 to ¥2,919/share.
• The stock was at ¥2,735 after activist Effissimo had built a 13% stake at ¥2365. The day after the announcement, the stock opened up through terms and continues to climb.
• Effissimo responded 4 days later, buying 2% of voting rights as the stock climbed past ¥3,000, another 1% later. Now the stock is 8+% through new terms. They’re not playing.

• Mitsubishi Electric is strategically divesting non-core assets, including a motor and insurance business, to free up capital and focus resources on the high-growth Factory Automation Digital Solution business.
• Capital optimization efforts have generated financial resources to fund the company’s ambitious Digital Transformation goals and M&A pipeline, including the acquisition of Nozomi Networks.
• Company now focused on structural enhancement, including significant CapEx plan for FY26 prioritizing the Semiconductor & Device segment, which covers SiC technology for semiconductor applications; large R&D investments also planned

• Q3 arrived slightly soft, but currency-neutral EBIT narrows the miss; Q4 needs a steep ramp, though much of the downside risk already appears priced in.
• Longer-Term trajectory remains solid: sustained ~25% growth and a credible path to mid-teens operating margins by FY27 as AI adoption and enterprise penetration deepen.
• Cash flow softness reflects slower conversion and continued intangible investment, but growing pains not structural issue; valuation still shows 25%+ upside on DCF.

• In cumulative Q3 FY12/25, revenue was JPY92.6bn, with an operating loss of JPY280mn and a recurring loss of JPY17.1bn.
• Amusement Equipment business revenue was JPY41.4bn, with a 29.6% YoY increase in units sold to 83,877 units.
• Integrated Resort business revenue was JPY50.6bn, with an operating loss of JPY3.0bn and adjusted EBITDA of JPY9.9bn.

• For 1H FY03/26, revenue decreased 7.7% YoY to JPY154.5bn, with operating profit down 16.6% YoY to JPY4.5bn.
• The company revised FY03/26 forecast, lowering revenue by JPY19.0bn and operating profit by JPY2.1bn due to external disruptions.
• Full-year dividend forecast remains JPY90.0 per share, with a projected payout ratio of 38.5%.

• In 1H FY03/26, revenue rose 12.9% YoY to JPY632mn, with gross profit increasing 73.3% YoY to JPY270mn.
• Laser Device business revenue grew 10.8% YoY to JPY579mn, with operating profit rising 34.9% YoY to JPY98mn.
• Visual Information Device business revenue increased 43.2% YoY to JPY52mn, reducing operating loss to JPY100mn from JPY223mn.

• Ichiken’s 1H FY03/26 consolidated revenue reached JPY54.6bn, with operating profit at JPY3.7bn, exceeding initial forecasts.
• The Construction business, accounting for 99.8% of revenue, saw orders rise 4.9% YoY to JPY54.6bn.
• FY03/26 forecast revised upwards: revenue JPY101.0bn, operating profit JPY6.7bn, reflecting cost pass-throughs and project profitability.

• The company’s adjusted EBITDA rose to JPY5.5bn (+68.1% YoY) due to improved profitability and reduced expenses.
• Segment sales in the Healthcare segment reached JPY34.6bn (+5.0% YoY), with segment profit at JPY4.4bn (+95.4% YoY).
• The company revised its full-year forecast, expecting sales of JPY50.0bn and adjusted EBITDA of JPY7.0bn (+61.7% YoY).

• 1H FY03/26 sales were JPY29.6bn (-8.9% YoY), operating profit JPY2.4bn (-0.5% YoY), net income JPY1.8bn (-66.3% YoY).
• Media segment sales JPY19.1bn (-8.6% YoY), operating profit JPY1.9bn (-18.4% YoY); Agent segment sales JPY5.3bn (+4.4% YoY).
• Global segment sales JPY3.1bn (-37.9% YoY), operating profit JPY668mn (+80.9% YoY) due to revenue recognition changes.

• Digital Information Technology is a well-established Japanese IT services firm demonstrating a consistent and impressive track record of double-digit growth in revenue, net income, and dividends, capitalizing on Japan’s digital transformation trend.
• The company operates through two primary segments: a comprehensive Software Development arm, which includes business solutions, embedded systems, and cybersecurity products, and a System Sales segment focused on SMEs, providing a diversified revenue stream.
• Supported by a robust domestic IT market projected to grow at a CAGR of approximately 10-11%, the company is well-positioned to benefit from strong government initiatives and increasing corporate investment in digitalization, cloud adoption, and cybersecurity.

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• Sales increased by 16.5% YoY to JPY196.4bn, with growth across all business segments, and operating profit rose by 33.5% YoY.
• Toys segment sales reached JPY86.0bn (+10.2% YoY), with operating profit at JPY5.0bn (+12.0% YoY), driven by lottery products.
• Dividend policy revised to JPY60.0 per share for FY03/26, with a target payout ratio of 40%.

• Sales reached JPY58.8bn (+3.9% YoY), with growth in power supplies, I/O devices, and beauty appliances.
• Operating profit increased to JPY6.2bn (+13.5% YoY), driven by higher gross profit despite rising SG&A expenses.
• B2C sales totaled JPY39.3bn (+2.7% YoY), while B2B sales reached JPY19.5bn (+6.5% YoY), with strong e-commerce growth.

• Today, logistics company SENKO Group Holdings Co., Ltd. (9069 JP) announced a bid for logistics company Maruwn Corp (9067 JP) with help from 35% holder JX Advanced Metals (5016 JP). 
• The TOB only needs 11+% to get to 50.1%. There are three holders who Senko clearly regard as not necessarily agreeable to the deal. They hold 28.0% between them. 
• If someone wanted to thwart this deal, there are a number of ways to do it. This could get interesting. 

• Maruwn Corp (9067 JP) has recommended a preconditional tender offer from SENKO Group Holdings Co., Ltd. (9069 JP) at JPY949, a 34.6% premium to the last close price.
• The offer is attractive as it is above the midpoint of the IFA DCF valuation range, represents an all-time high and implies a P/B of 1.08x.
• The key pushback is that Senko has not set the lower limit to achieve two-thirds voting rights. However, tendering by the second-largest shareholder will meet the lower limit. 

• 12mos ago the FT had an article suggesting PE might launch a bid foe Fujitec Co Ltd (6406 JP). 9mos later, EQT did at the same price as 9mos earlier. 
• There were some suggestions the deal would see an overbid. That was quashed early. It never traded through terms early on.
• This looks like a done deal to me. I think this sails through by year-end.

• Human Made (456A JP) aims to raise around US$116m in its Japan IPO.
• Human Made Inc. is a Japan-based apparel and lifestyle company. Its business model centers on producing high-value, limited-supply apparel and goods.
• In our previous note, we looked at its past performance. In this note, we will talk about valuations.

• Towa holds a dominant global market share in semiconductor molding equipment, a critical step in the chip manufacturing process. Its technological leadership, particularly in compression molding for high-end chips, positions it to capitalize on long-term growth trends.
• The company is a key beneficiary of the secular growth in artificial intelligence (AI), high-performance computing (HPC), and electric vehicles (EVs). These applications require advanced semiconductor packaging, driving demand for Towa’s specialized equipment.
• Financial performance has been robust, with significant revenue and operating profit growth. The company has a long-term vision, “TOWA Vision 2032,”targeting substantial sales growth and improved profitability, supported by strategic investments in R&D and production capacity.

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• ASICS is demonstrating exceptional growth, driven by market share gains in its core Performance Running segment and the rapid expansion of its high-margin Lifestyle brands, Onitsuka Tiger and SportStyle.
• The company’s financial performance is robust, characterized by seven consecutive quarters of double-digit revenue growth, significant margin expansion, and upward revisions to profit guidance.
• Future growth is contingent on successful penetration of the large but historically underdeveloped North American and Asian markets, alongside continued product innovation and expansion of its digital, direct-to-consumer channels.

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• Star Mica is a specialized real estate company in Japan with a unique business model focused on acquiring, renovating, and reselling used condominiums, a niche market with significant growth potential due to Japan’s maturing housing market.
• The company has demonstrated a solid track record of revenue growth and profitability, supported by a strong position in the pre-owned condominium market and a focus on value-added renovations.
• Future growth is expected to be driven by the increasing demand for affordable and renovated housing, favorable demographic shifts towards urban living, and the company’s strategic initiatives to expand its portfolio and enhance operational efficiency.

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• Freee reported 1QFY06/2026 results today. 1Q revenues increased 32.1% YoY to ¥9.7bn with an Adj. OPM of ¥690m (vs ¥480m in 1QFY0/2025). Both revenue and GAAP OP beat consensus.
• Freee KK (4478 JP) ’s shares had a sell-off following its 4QFY06/2025 earnings announcement which saw the company breaking away from its recent trend of consecutive quarterly operating profits.
• As we highlighted in our previous insight, 4Q decline was only a temporary setback as the company’s profitability has bounced back and we expect earnings momentum to continue.

• In Q3 FY12/25, revenue reached JPY4.5bn, with Bitcoin-related business contributing JPY4.2bn and Hotel business JPY203mn.
• Operating profit was JPY2.7bn, driven by JPY3.3bn from Bitcoin-related business and JPY104mn from Hotel business.
• Recurring profit was JPY23.2bn, significantly improved from a JPY312mn loss in cumulative Q3 FY12/24.

• Sales reached JPY26.2bn (+0.2% YoY), with operating profit at JPY1.4bn (+16.0% YoY), and net income JPY844mn (+18.2% YoY).
• Domestic sales were stable, with increased average eyeglass prices, but unit sales declined due to cost-conscious consumer behavior.
• Overseas sales were affected by the China subsidiary’s decline, despite improved profitability from closing unprofitable stores.

• Today after the close, Paris Miki Holdings (7455 JP) announced the Tane family Holdco would buy out the company in an “MBO” at ¥581, or 4.8x current year EBITDA. 
• World famous eyeglass/sunglass manufacturer Luxottica bought 13.8% of the company in the low ¥300s almost stopping about a year ago. They might complain, but Paris Miki is a big outlet.
• This looks like it gets done. The family+crossholders+ESOP+warrants have 65% of the expanded share count. Those who would complain would need to do so soon, and loudly.

• Paris Miki Holdings (7455 JP) has recommended a Chairman-led MBO at JPY581, a 48.6% premium to the last close price.
• While the offer is arguably light as it is marginally below book value (P/B of 0.99x), it is above the midpoint of the IFA DCF valuation range. 
• The offer represents a 10-year high. Luxottica Group (LUX IM), the second-largest shareholder, has not signalled whether it will tender, but it would struggle to derail the offer.

• Human Made (456A JP) aims to raise around US$116m in its Japan IPO.
• Human Made Inc. is a Japan-based apparel and lifestyle company. Its business model centers on producing high-value, limited-supply apparel and goods.
• In this note, we look at the company’s past performance.

• Star Micronics (7718 JP) has recommended a tender offer from Taiyo Pacific Partners at JPY2,210, a 29.1% premium to the last close price.
• The offer is arguably light as it is marginally above book value (P/B of 1.09x) and 16% below the midpoint of the target IFA DCF valuation range. 
• However, the offer is attractive as it represents an all-time high and is 42.4% above Taiyo’s placement price in May 2025. Unless an activist emerges, this is likely done.  

• Today after the close, well-known Japan engagement fund Taiyo Pacific Partners announced a deal to buy Star Micronics (7718 JP) for ¥2,210/share. They’ve been involved small-big-small for 20yrs.
• The company launched a new capital plan and MTMP in February. Cash-rich, it needed no money to grow aggressively. So TPP proposed buying a third of the company. Board agreed.
• Despite ActionsToImplementManagementConsciousOfSharePriceAndCostOfCapital announced February, in April-November the Board decided to sell the entire company to TPP at <1x book. This is borderline outrageous. It deserves notice and complaint.

• Revenue was JPY3,736.8bn (+7.7% YoY), with net income attributable to owners at JPY2,924.1bn (+190.9% YoY).
• Investment gain was JPY3,926.7bn, including JPY2,156.7bn from OpenAI, with SVF business gaining JPY3,415.5bn.
• Arm segment revenue reached JPY320.3bn (+17.0% YoY), with segment profit increasing 518.4% YoY to JPY23.6bn.

• Softbank Group (9984 JP) is swinging wildly. On Nov 11, the stock sank -13% after it said it had sold its entire stake in NVIDIA (NVDA US)  for $5.83 billion.
• The stock also posted record Q2 earnings on Nov 12, but closed the day down -3.46% (after a strong rally from the 21k bottom). Most gains come from OpenAI investment.
• For sure it’s not easy to hold this stock at the moment, this insight will analyze the next 2-3 weeks’ outlook, support and resistance, according to our quantitative model.

• JX Advanced Metals (5016 JP) — Second Guidance Upgrade; Margin Expansion Accelerates, Momentum Builds
• Focus businesses now contribute nearly half of operating profit, reinforcing structural earnings quality.
• JX Advanced Metals trades at ~22× FY26E P/E and ~13× EV/EBITDA, reflecting premium growth exposure but still below Japanese specialty materials peers (Tokyo Ohka ~26×, Entegris ~45×).

• Revenue increased by 15.9% YoY to JPY74.2bn, with all segments showing revenue growth and operating profit up 35.1% YoY.
• Extraordinary loss of JPY5.9bn related to the Antimonopoly Act led to a net loss of JPY1.5bn.
• Domestic demand remained firm, with revenue and profit rising YoY due to product price revisions and improved productivity.

• 7th straight quarter of double-digit growth; 3Q revenue +21% y/y to ¥222bn, led by strong EU and Japan performance and steady global expansion.
• Gross margin +110bps to 56.1%, operating margin +320bps to 20.9%; FY OP guidance raised to ¥140bn, share buyback of ¥30bn announced.
• Near-Term share impact limited, but long-term growth underpinned by SportStyle and Onitsuka Tiger; OP could double to ~¥260bn though next MTP cycle.

• Softbank Group (9984 JP)  reported a record H1 net income of ¥2.9 trillion, driven principally by a USD 14.6 billion fair-value gain from its OpenAI investment and Rights to invest.
• The Group fully exited its USD 2.9 billion NVIDIA Corp (NVDA US) stake in October, realizing gross gains of USD 2.9 billion on sale proceeds of USD 5.8 billion.
• It also sold partial stakes in T-Mobile for USD 9.2 billion and Deutsche Telekom for USD 2.4 billion even as it raised its investment target in OpenAI to USD34.7 Bn.

• Quiddity’s “Who is Ready” series of insights aims to objectively identify names listed on the Tokyo Stock Exchange that are potential additions to the TOPIX Index in future.
• Japan Business Systems (5036 JP) and Orion Breweries (409A JP) were included in the TOPIX index at the end of October 2025. 
• Japan Eyewear Holdings (5889 JP), FIT EASY (212A JP), and Tekscend Photomask (429A JP) will be included in the TOPIX index at the end of November 2025.

• Takamiya (hereafter, the Company) is a leading manufacturer of temporary equipment used at construction sites, with its business centered on the next-generation scaffolding system Iq System, launched in 2014.
• Its vision is to become the industry’s first scaffolding platform company, shifting from a flow-based to a stock-based business centered on the Takamiya Platform, with the aim of establishing a new profit structure and strengthening the balance sheet.
• Construction investment continues to trend upward, and construction volume among the Company’s customers remains resilient.

• The company reported record highs for 1H with revenue of JPY361.7bn and profit attributable to owners of JPY70.3bn.
• Effective Q1 FY03/25, the company adopted a new segmentation, now reporting seven segments, including Electricity and Gas.
• Dividend forecasts for FY03/26 were raised to JPY736 per share, reflecting solid earnings and outlook adjustments.

• Trial is moving quickly to integrate Seiyu following its ¥380 billion acquisition in July. 
• It will open the first Trial Seiyu combined store and also the first Trial Go (a convenience store competitor) store in Kanto, both this month.
• Already, more than 600 stores in the group are stocking private brands from each banner. 

• Ce Holdings is a specialized provider of medical information systems, primarily Electronic Medical Record (EMR) systems, strategically positioned to capitalize on Japan’s healthcare digitalization trend.
• The company exhibits a strong growth profile, evidenced by a 3-year net income CAGR of 38.4% and a consistently increasing dividend, supported by favorable demographic tailwinds from Japan’s aging population.
• Valuation appears attractive, with a P/E ratio of 7.8x, trading at a significant discount to healthcare IT peers, suggesting a potential mispricing given its solid financial performance and market position.

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• NGK Spark Plug, now operating as Niterra, is the global leader in spark plugs and automotive sensors, commanding a dominant market share. However, the company faces a significant long-term structural headwind from the global transition to electric vehicles (EVs), which do not utilize its core products.
• Management is actively pursuing a diversification strategy to mitigate EV risk, leveraging its core competency in ceramics to expand into higher-growth areas. Key focus areas include components for semiconductor manufacturing equipment, medical products, and next-generation technologies like solid-state batteries.
• The company exhibits strong financial performance with consistent revenue growth, robust profitability, and significant cash flow generation. Valuation appears attractive relative to peers, but the market is pricing in the long-term uncertainty associated with the decline of the internal combustion engine (ICE).

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• Consolidated ordinary income increased to JPY33.0bn (+15.7% YoY), with ordinary profit at JPY6.9bn (+16.0% YoY).
• Non-consolidated core operating profit slightly declined to JPY6.0bn (-0.3% YoY), while ordinary profit rose to JPY6.8bn (+9.0% YoY).
• The bank revised its FY03/26 forecast, projecting consolidated ordinary profit of JPY11.3bn (+5.8% YoY) and maintaining dividends.

• Sanyo Trading’s FY09/25 sales rose 2.7% YoY to JPY132.7bn, driven by strong Sustainability segment sales.
• Operating profit fell 9.1% YoY to JPY6.4bn due to higher SG&A expenses and investment valuation losses.
• FY09/26 forecasts project a 2.0% YoY sales decline to JPY130.0bn, with profit decreases at all levels.

• In 1H FY03/26, revenue was JPY40.3bn (+3.7% YoY), with operating profit at JPY6.7bn (+12.3% YoY).
• Revenue growth was driven by higher shipment volumes and subscriber growth, offsetting increased variable costs and sales investments.
• Gross profit margin rose 0.9pp to 85.9%, with operating profit margin improving 1.3pp to 16.7% YoY.

• Today after the close, KKR announced a deal whereby they and founder OKUBO Izumi-san would take Forum Engineering Inc (7088 JP) private in an LBO. 
• The process of this deal ticks most all of the “bad process” boxes but the price is pretty good.
• 52% is locked in. Insiders and cross-holders appear to own another 15-18%. This looks like a done deal to me. Money comes 30 December.

• Shiseido’s Q3 revenue rose 4.6% YoY to ¥224bn, marking its first growth in three quarters, though full-year sales guidance was cut 3%.
• Profitability remained pressured by tariffs and Drunk Elephant weakness; product margins fell 340bps YoY, but SG&A improvements limited overall margin decline to 80bps.
• Management maintained core OP profit guidance and continued executing structural reforms, achieving ¥21bn cost savings YTD, with deeper efficiency cuts planned through 2026.

• Forum Engineering Inc (7088 JP) has recommended a tender offer from KKR & Co (KKR US) at JPY1,710, a 32.6% premium to the last close price.
• The offer is arguably light due to a lack of an auction and is below the midpoint of the target IFA DCF valuation range. 
• However, the offer is attractive compared to precedent transactions, peer multiples and represents an all-time high. The large number of cross-holders will help meet the required tendering rate.

• Mitsui Chemicals is slashing exposure to commodity chemicals and ramping up high-margin specialty films and resins—setting the stage for its RoE to soar from 5% to over 13%.
• Restructuring is unlocking massive cost savings while driving growth from cutting-edge segments that are poised for double-digit growth and global dominance.
• The stock trades at a deep discount, but could easily command a premium with solid execution, driving the share price to more than double or even treble within 3 years.

• Trough valuations: JFE trades at only US$525/t EV/t and 0.5× P/B, despite stable guidance and improving high-value steel mix.
• Hidden value: 15% JSW Steel stake (~¥500 bn) equals ~45% of JFE’s market cap—cheap India exposure with re-rating potential.
• Upside case: SOTP implies +50–60% equity upside, supported by 4–5% dividend yield and H2 margin recovery.

• Announced last Friday, FY Sep-25 sales and net profit were in line with guidance, but operating profit fell short. On Monday, the shares dropped 4.5%, wiping out a month’s gains.
• Looking ahead, management expects three years of sales and profit growth as capex declines, depreciation and R&D level off, and the NKT Photonics acquisition approaches breakeven.
• In this scenario, semiconductor, bio-medical, defense and quantum computing applications should drive 3-year sales growth of 24% and a 71% increase in net profit, bringing the P/E down to 20X.

• Olympus Corp (7733 JP) registered 20% QoQ rise in revenue to ¥247.8B in Q2FY26 while the adjusted operating profit witnessed 183% QoQ growth to ¥37.4B (margin expanded 870bps to 15.1%).
• The company reiterated full-year forecasts for FY26. The company expects revenue to be ¥998B, flat YoY (+3% after FX adjustment).
• Sequential improvement offers early green shoots. Moreover, decreasing “Elevate” program cost, product launches and venturing into endoluminal surgical robotics segment will slowly help propel growth in the near to midterm.

• Operating revenue increased by 9.9% YoY to JPY11.8bn, driven by growth in recurring and asset-related revenue.
• Operating expenses rose 13.3% YoY to JPY10.6bn, mainly due to higher finance and personnel costs.
• Pre-tax profit decreased 12.2% YoY to JPY1.2bn, despite revenue growth, due to increased operating expenses.

• Mitsuboshi’s revenue rose 0.9% YoY, with Belts segments offsetting lower Building & Construction Materials revenue.
• The company plans to pay an annual dividend of JPY186 per share in FY03/26, unchanged from FY03/25.
• Mitsuboshi announced a resolution to repurchase 350,000 shares, valued at JPY1.0bn, via market purchases on the Tokyo Stock Exchange.

• In 1H FY03/26, revenue increased by 69.4% YoY to JPY59.0bn, with operating profit rising 185.0% YoY.
• Built-for-sale condo business saw revenue of JPY40.5bn (+93.6% YoY) and 620 units delivered (+230 units YoY).
• Purchase and resale business revenue reached JPY9.4bn (+81.8% YoY), while brokerage revenue fell 3.3% YoY.

• Saint-Care Holding (2374 JP) has recommended an MBO from the founding family at JPY1,220, a 48.8% premium to the last close price.
• The offer is attractive compared to historical trading ranges and is above the midpoint of the target IFA DCF valuation range. 
• Due to the irrevocables, it is not onerous to meet the minimum acceptance condition. This is a done deal.  

• I summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads: Mayne Pharma (MYX AU), Saint-Care Holding (2374 JP), Smart Share Global (EM US), ENN Energy (2688 HK), Dongfeng Motor (489 HK), Digital Holdings Inc (2389 JP). 
• Lowest spreads: Bright Smart Securities (1428 HK), Mandom Corp (4917 JP), Pacific Industrial (7250 JP), Toyota Industries (6201 JP), Seven West Media (SWM AU), Jinke Smart Services (9666 HK). 

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments: CNGR Advanced Material (300919 CH) is seeking to raise US$507 million through a H Share listing.
• Event-Driven developments: Toyota Industries (6201 JP), Japan Infrastructure Fund Investment Corporation (9287 JP), Mandom Corp (4917 JP), Pacific Industrial (7250 JP), Saint-Care Holding (2374 JP), ANE Cayman Inc (9956 HK). 

• Mitsubishi Electric is successfully executing a multi-year pivot toward becoming a high-margin digital solutions provider, anchored by its DX strategy and acquisition of OT security leader Nozomi Networks.
• H1 FY26 financial results confirm clear operating strength, showing a strong 60% year-over-year surge in net profit and strong revenue growth, especially within the Infrastructure and Life segments.
• Management’s shift to higher-margin software and services, along with disciplined capital management, is materializing value and helps justify a positive long-term view.

• This four-day week saw 10 new guidance revisions (+61% on average), and 21 H1 earnings results (13 which hadn’t guided, averaging +41%, 8 which had, averaging 5.7% uplift vs guidance)
• It was a Good Week, though banks fell 0.4% as TOPIX fell 1% on the week. 
• Once again, lower credit costs, higher net interest income, and some equity sales dominated. H2 implied guidance lower in many cases, some because of expected portfolio rebalancing (loss-taking).

• In response to calls from overseas investors to eliminate parent-subsidiary dual listings, the number of listed subsidiaries has decreased, while the number of equity-method affiliates has increased.
• Some companies that found themselves with no wayout resorted to selling off part of their holdings to transition to equity method affiliates, for the time being, driven by herd mentality.
• When considering investment strategies focused on parent-subsidiary listings, in the highly liquid Prime Market, equity method affiliates are more promising investment targets than the limited number of listed subsidiaries.

• Advantest’s updated guidance and MTP3 targets confirm its dominant, long-term growth trajectory as a key supplier for the high-performance computing and AI semiconductor supply chain.
• Despite a strong structural growth story, the stock faces near-term headwinds from a sequential decline in Q2 operating income and an elevated valuation that reflects peak market optimism.
• We suggest a tactical adjustment to vega exposure due to market dynamics, recommending a strategy to monetize the heightened implied and realized volatility following the strong earnings report.

• 1H FY03/26 sales reached JPY63.9bn (+6.9% YoY), operating profit JPY1.3bn (+25.2% YoY), net income JPY452mn (+118.4% YoY).
• Community Pharmacy Network segment sales JPY120.1bn forecasted, with segment profit JPY6.0bn, driven by network expansion and digital services.
• FY03/26 forecast includes sales JPY125.5bn (+2.5% YoY), EBITDA JPY6.9bn (+4.9% YoY), net income JPY1.3bn (+3.0% YoY).