Japan

• On May 9, 2024, Migalo Holdings Inc. (hereafter, the Company) announced its full- year FY2024/3 earnings results.
• Sales rose 14.5% YoY to ¥42,672 mn, and operating profit fell 14.4% YoY to ¥2,500 mn, largely in line with the Company’s full-year forecast calling for sales to rise 12.7% YoY to ¥42,000 mn and operating profit to drop 14.4% YoY to ¥2,500 mn.
• The Company will pay a year-end dividend of ¥45 per share, including a commemorative dividend of ¥5 per share to celebrate the 20th anniversary of the founding of its predecessor, Property Agent, Inc.

• Companies with higher foreign shareholdings have superior board practices, suggesting that overseas investor engagement played an important role in improving management that resulted in return on capital.
• Clues to changes in management reform can be found in the percentage of independent board members, the percentage of female board members, and policy shareholdings/total assets.
• While the substance of the goals is important, the focus has shifted to management’s strong will to achieve the goals to raise valuations and return on capital.

• JPX has commenced a market consultation on changes to the TSE Tokyo Price Index TOPIX (TPX INDEX) including expansion of the universe and periodic stock selection.
• Based on current market cap/ liquidity, there could be 38 adds and 447 deletions for the TSE Tokyo Price Index TOPIX, though the changes only start in October 2026. 
• The deletions will be phased out of the index in 8 steps that will end in July 2028 and most of the stocks will move to the TOPIX Next-tier. 

• Shin Etsu Chemical (4063 JP), owner of a 44% stake in Mimasu Semiconductor Industry (8155 JP), will launch the TOB to buy out Mimasu minority holders, as pre-announced 2mos ago.
• Not surprising. They bought in 19yrs ago, raised to 40+% 18yrs ago, then waited. Finally, we have a deal. It’s too cheap but in 18yrs, I recall zero activism here.
• Shin-Etsu starts with ~45%, and crossholders and the chairman get it to 53%. Then they need a bit to get them to 67% but it should be straightforward.

• 18 months after announcing the offer, ENEOS Holdings (5020 JP) launched the Tatsuta Electric Wire & Cable (5809 JP) tender offer at unchanged JPY720, 4.9% below the last close price.  
• The Board requested a bump, but Eneos refused due to Tatsuta’s missed targets, no competing offer and the supportive updated IFA valuation
• The lack of a bump, no vocal opposition, deal fatigue, the Board’s unexpected recommendation, weak earnings and 73.9% takeover premium will help acceptance.

• ENEOS announced its deal for Tatsuta Electric Wire & Cable (5809 JP) 18mos ago. China approval took a while. Now they have launched. 
• The TOPIX Non-Ferrous Metals sector has returned 60%. TOPIX 50%. There is a new TSE Sheriff in town asking for PBR 1.0x. BVPS is up. Presumably, forward CF is up.
• But the TOB Price is unchanged. That is disappointing. One reason why a higher price was rejected was that no other buyer approached to take over the company. 🤷🏻‍♂️

• The Sep 2024 Nikkei 225 Review base date is six weeks away. One can no extrapolate results quite accurately. It still gives us one ADD, one DELETE, and capping fun.
• Recently, Yanai-san sold more Fast Retailing (9983 JP). More active holders own more stock (which may mean less interest to buy later), and only 1% to go to avoid capping.
• There should be one DELETE, one ADD. There is a low-probability Dark Horse ADD but I expect Kokusai Electric (6525) to be added in March 2025. 

• Mimasu Semiconductor Industry (8155 JP) notes that the pre-condition for Shin Etsu Chemical (4063 JP)’s JPY3,700 tender offer has been satisfied. The tender runs from 21 June to 5 August.
• The share price has traded at or above the offer on 15 out of 38 trading days, partly due to expectations of a counteroffer. 
• While the offer is below the midpoint of the IFA DCF valuation range, it represents an all-time high. The lack of activists or competing offers suggests a done deal.

• Production problems of Vyvanse generics seem to be largely resolved with nine of the ten suppliers back in stock.
• Safety concerns with Takeda’s approved psoriasis competitor does raise further concerns as they are both TYK-2 inhibitors.
• The company’s $900 m big restructure and cited areas for margin improvement are not “convincing” and lack detail.   

• Approaching a transformational phase – MIXI Inc. is a digital content company generating earnings from its ‘MONSTER STRIKE’ mobile gaming franchise.
• Operating in a mature domestic gaming market, the company has successfully diversified into lifestyle and sports, but to date has experienced limited earnings contribution.
• We believe this is about to change, driven by the new monetization strategy for the ‘FamilyAlbum’ video and photo- sharing service app in FY3/25. 

• In 2021 the JPX established new Listing Rules, and in April 2022 introduced new market segments (Prime/Standard/Growth) to much fanfare. Today, the TSE basically said those changes were meaningless.
• Today, the TSE announced proposed new rules for TOPIX constituent selection. There is a 2-month consultation period, then rules come out end-Sep 2024. Expect few changes from the Proposal.
• NextGen TOPIX will be created October 2026. 3-4 dozen ADDs, 500-600 DELETEs to create an index of 1,100-1,200 names. Some obvious large impacts 2+yrs from now, but this changes IPOs.

• Money Forward’s share price has declined by around 16% since reporting Q1 results.
• The company will report Q2 results in early July. We expect continued solid momentum
• We believe the stock price has around 30% upside potential to our target price of ¥6,600

• Following up on our earlier cross-shareholding notes, in this note we look at Mizuho Financial Group (8411 JP)‘s cross-shareholding.
• Mizuho had a stake over US$100m in at least 34 listed Japanese stocks, amounting to a total of around US$7bn.
• In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.

• We update twelve Japanese regional banks, and add two new names, to target beneficiaries of the improving interest rate outlook; also banks with attractive credit quality, capital adequacy and valuations
• We identify the value of equity holdings for disposal among these banks; the lack of near-term easing prospects at the US Fed should support JGB yields and domestic bank valuations
• We add smaller cap Juroku Financial to our buy list of Tokyo Kiraboshi Financial, Gunma Bank and higher risk option Suruga Bank

• The premium fashion market in Japan is growing again and it is not just department stores.
• One of the leader is United Arrows, whose main urban chains are on a roll, up double digits, but is being held back by lower priced suburban chains.
• It will now focus more  on the premium market through aggressive category expansion, new brands and M&A.

• Even companies with high valuations and return on capital have room to further raise their return on capital and valuations because of cash allocation challenges.
• Companies whose valuations have not changed over the past year have low ROE and ROA, yet have high policy shareholdings. They have not taken steps to improve return on capital.
• As for whether many companies without high foreign ownership can raise their return on capital and valuations, strong will of management to achieve their goals is necessary.

• Market leader with growth potential – GEO HOLDINGS operates second-hand store chains 2nd STREET, GEO, OKURA, and off-price chain store Luck Rack.
• Its 2,027 domestic stores give it the leading market share in Japan.
• The company is making significant investments to extend its home advantage and build on its 2018 expansion overseas where it has 81 stores. 

• As expected, Goldwin posted another record year of sales and profits in FY2023.
• The sports firm is now narrowing its focus on a smaller number of high profile brands to maximise sales and investment spending.
• The big promise is its own brand, Goldwin, which is proving as popular overseas as in Japan and looks set to become a global premium sports brand longer-term.

• 15 weeks ago, a specialised media outlet suggested Teijin Ltd (3401 JP) was in process to sell its stake in Infocom Corp (4348 JP). 
• I caught up later, after the stock had run up significantly, but writing bullishly here and here. Since then, the stock is up another 33-35%.
• Today we finally got the announced deal. Blackstone will buy the stock at a valuation of ¥280bn, paying ¥6,060/share for the minority stake, and buying back Teijin’s stake at ¥4,340/share.

• Late May, Aisin (7259 JP) announced a sell-down of its 34% stake in Exedy Corp (7278 JP) – a big non-dilutive offering, pricing 11% below undisturbed. Exedy announced a buyback.
• Announced on the 27th of May, shares fell sharply the next day, it priced on the 3rd, and offering shares traded on the 10th. Then the price started climbing back.
• My first and second pieces argued that buyback accretion, index impact, and change in register shape all meant it was a buy. Activist Murakami agreed, now he has 6.5%. 

• Following months of press speculation, Infocom Corp (4348 JP) announced a Blackstone (BX US) tender offer at JPY6,060 per share, a 177.3% premium to the undisturbed price. 
• After the share consolidation, Infocom will repurchase Teijin Ltd (3401 JP)’s stake at a share repurchase price of JPY4,231. The process is expected to be completed in early October.
• The offer is a knockout bid helped by auction. This is a done deal with payment commencing from 7 August. At the last close, the gross spread was 0.5%.

• KDDI will complete its acquisition of a 50% share in Lawson this month and the chain will then delist.
• KDDI is promising a rapid introduction of services and fresh ideas to leverage its new retail arm.
• It will begin by unifying premium loyalty point membership under the Ponta brand and offer new services that it hopes will help boost share. What out LY.

• FY2024/3 Earnings Result Summary: COPRO-HOLDINGS. Co., Ltd., (hereafter, the Company) announced the full year results for FY2024/3 after the market close on Tuesday, May 14, 2024.
• The key consolidated figures include net sales of ¥24,098 mn (+28.2% YoY), operating profit of ¥2,141 mn (+62.0% YoY), ordinary profit of ¥2,211 mn (+67.0% YoY), and profit attributable to owners of parent (hereafter, net profit) of ¥1,463 mn (+69.3% YoY).
• Having posted a dramatic increase in net sales due to record hiring, COPRO CONSTRUCTION. Co., Ltd., which operates the Company’s core construction technician dispatching business, made substantial contributions to increased earnings.

• Murakami’s entity, City Index Eleventh, and daughter reported a 5.46% position in Exedy Corp (7278 JP). The shares purchases began two days after the Aisin (7259 JP) secondary offering.
• Murakami’s average buy-in price is JPY2,607.30 per share, 2.3% higher than the recent secondary offering price of JPY2,549.
• Murakami’s disclosure suggests two possibilities: the start of an activist campaign or a short-term pump-and-dump play. Recent precedents suggest the latter.

• In January, Kagome Co Ltd (2811 JP) announced an acquisition of an additional 50% stake in a US equity affiliate. It is transformational. Incremental ROIC is truly excellent.
• At the time, they said they’d finance the purchase with a bridge loan but would sell treasury shares for ¥25bn or less to cover it. They announced the shelf then.
• Friday they announced the Offering. Today shares fell 8+%. This is now cheap. 

• Short term borrowing rose 2.3x in the past four quarters, alongside rising interest rates
• During this time, long term borrowings were actually down, so no locking in of low rates
• As such, Chiba is not fully, or hardly benefiting from BOJ policy changes, with NIM down

• Miroku Jyoho Service (TSE:9928) , which offers on-premises, hybrid (IaaS) and cloud accounting software to Japanese enterprises of various sizes.
• Our purchase is centred around the business achieving further transition to the cloud, allowing for substantial margin improvement through the accumulation of high gross margin SaaS revenue.
• This transition has impacted firm profitability in the short term due to the shift in revenue recognition as quoted below by the company

• Companies with low valuations have lower ROE, ROA, and foreign ownership as well as inferior board practices and key actions. Conversely, companies with high valuations show the opposite relationship.
• Over the past year, companies that increased their valuations were those with already  high valuations, return on capital and foreign ownership that further improved their earnings and increased their valuations.
• This suggests that companies that have begun to make progress in management reform by improving board operations and clarifying management policies through engagement by overseas investors have achieved positive results.

• Avant was founded in 1997 by the current CEO Tetsuji Morikawa and is a Japanese holding company of financial and non-financial software which have the collective goal of assisting its clientele to increase corporate value.
• This includes ‘Diva’ as Japan’s foremost (43% market share) consolidated accounting software and board meetings platform in addition to ‘Avant’, a management system for corporate value enhancement through consolidation of information (Avant Cruise) , charting (Avant Chart) , and corporate value enhancement (Avant Compass).
• Lastly, there is ‘Zeal’ which includes several non-financial platforms that help organise and integrate (with Avant Cruise) from external sources. And interestingly, Avant also owns and operates Internet Disclosure Co, which runs Kaijinet, a site I have frequently visited over the years.

• PCI Holdings, Inc. (hereafter, the Company) is an IT provider of IT-related services and hardware, mainly focusing on embedded system technology such as embedded software, embedded computers, and the like.
• Though it is a relatively young company, born in 2005, it has grown up to be large enough to have net sales of ¥28,500 mn for FY2023/9 with approximately 1,600 employees along with organic growth and acquisition of many companies.
• Going forward, it will change the corporate structure and make it more profitable by investing its cashflow from its core businesses, the Engineering Business and the Product/Device Business, into the ICT Solutions Business, which has considerable potential growth fields such as solution development using AI, IoT platform and the like.

• Major milestones with high expectations coming in the next 2-3 years: 1) Phase IIb US trials for H-1337 as “first choice as a second-line Glaucoma drug” for patients who do not respond to PGs (top-line data is expected in the 2H of 2024)
• 2) 2024 application/approval and 2025 launch of DW-1002 in Japan, 2023 application and 2024 approval/launch in China, as well as orphan drug designation for combination formula MembraneBlue-DualⓇ (DW-1002 + trypan blue) in the US
• 3) in Japan, start P2 clinical trials in 2024, P3 trials in late 2025 though 2026, and normal schedule application for approval for regenerative cell-therapy DWR-2206 in 2027

• Japan is expected to face a shortfall of up 790,000 IT workers in 2030.
• GEECHS views this shortage of IT human resources as a social issue that the Group should solve.
• The Company’s current core business is its IT freelance matching business (Japan) that matches companies that want to outsource work to outside workers with IT freelancers who want to do that work, and the Company receives a matching fee as the IT freelancer sharing agent. 

• We 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: Yichang HEC Changjiang Pharma (1558 HK), Hollysys Automation Technologies (HOLI US), Fancl Corp (4921 JP), Asia Cement China (743 HK), Ansarada Group Ltd (AND AU). 
• Lowest spreads: Tatsuta Electric Wire & Cable (5809 JP), Mma Offshore (MRM AU), Great Eastern Holdings (GE SP), Alumina Ltd (AWC AU), Nagatanien Holdings (2899 JP).

• Kagome Co Ltd (2811 JP) aims to raise around US$140m to repay debt used to fund the acquisition of Ingomar in Jan 2024.
• At the time of the acquisition, the company has stated its intention to part finance the acquisition via issuance of treasury shares
• In this note, we will talk about the placement and run the deal through our ECM framework.

• Sun Corporation is trading at 40% of its net asset value and has valuable SaaS business with Cellebrite
• Activist investor involvement may unlock trapped value in the company
• Cellebrite is a top digital forensics platform serving law enforcement agencies, making Sun Corp a promising investment choice in the Japanese market

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• 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: MMG (1208 HK) US$1.2 billion rights issue. Shift Up (462870 KS) and Webtoon Entertainment (WBTN US) IPOs.
• Event-Driven developments: Sun Corp (6736 JP), Fancl Corp (4921 JP), Tatsuta Electric Wire & Cable (5809 JP), Great Eastern Holdings (GE SP), A8 New Media (800 HK), Bapcor.

• The Palliser/Keisei Electric Railway Co (9009 JP) is an unconvincing trade. Avoid being long Keisei vs Oriental Land (4661 JP) except in short-term impact events. Avoid the drift trade also.
• On the subject of activism, keep an eye on China Merchants China Direct Investments (133 HK)‘s 20th June AGM. If Kan’s re-election is rejected, this stock should gain more momentum.
• A Sigma Healthcare (SIG AU)/Chemist Warehouse merger carried regulatory risk. And now the ACCC has raised a raft of concerns. 

• Medipal Holdings (7459 JP) reported FY24 result, with revenue and net profit beating and operating profit missing guidance. FY24 revenue increased 6% YoY, driven by growth across all business segments.
• The company is anticipating an upturn in revenue and operating profit in FY25. However, FY25 net profit is expected to fall due to the absence of extraordinary income.
• The company has announced a share buy-back plan to purchase up to 2.5M shares for ¥5B from May 15, 2024 to August 30, 2024.  

• Although few shareholder proposals will be passed, companies that receive shareholder proposals and don’t like the attention are likely to seek compromise and come to terms with shareholders before AGM.
• Companies with low valuations have significantly lower ROE, ROA, market capitalization, and foreign ownership. In order to raise valuations, the first step should be to increase return on capital.
• Companies with higher valuations can be expected to have begun to steer their board operations in an improved direction. Policy shareholding reductions can be considered as seriousness toward management improvement.

• Kirin Holdings (2503 JP) bought a 33% stake from the founder and several others in August 2019. Five years later, they are coming back for the rest. 
• The price here is ¥2,690/share which is a 42.7% premium from yesterday’s close. Kirin paid 20+% more in 2019. Earnings fell, but they paid 37x NTM. This is 32x. 
• This is lightish… but…  this should get done. Activism would be difficult. There are enough shareholders who should be OK getting out. This should trade tight.

• Fancl Corp (4921 JP) recommended Kirin Holdings (2503 JP)’s tender offer of JPY2,690, a 42.7% premium to the undisturbed price. 
• The timing looks opportunistic as Fancl’s shares are down 20% YTD. The offer period is from 17 June to 29 July.
• While the offer is attractive vs peer multiples, it is light vs historical trading ranges. Securing the required acceptance rate could prove challenging as the offer price is light. 

• Today at noon JST, Rs Technologies (3445 JP) released an announcement on TDNet, “Our policy regarding the tender offer for Helios Techno Holding Co., Ltd. shares”
• In it, they indicated that the price offered – ¥825/share – is a price which “fully returns to general shareholders the increased enterprise value that will result from [transaction] synergies.”
• They acknowledge the market price is trading higher than the TOB Price, but say they have no plans to raise the Tender Offer Price. So now what? It depends.

• Today, according to public news, Kirin Holdings will launch a tender offer for Fancl Corp (4921 JP) at a likely 30% premium. 
• The beauty industry is historically ripe with M&A deals.  It is not hard to see why, as the global beauty sector trades at a hefty valuation multiple. 
• In this insight, we brainstorm for potential buyers of Shiseido Company (4911 JP) and analyze the viability of such. 

• Revenue increased by 9.2% YoY to JPY5.8bn, driven by economic recovery and increased inbound demand.
• Operating profit decreased by 52.5% YoY to JPY567mn due to higher advertising and promotional expenses.
• Financial business revenue rose 14.9% YoY to JPY2.5bn, with a 29.4% YoY decrease in operating profit to JPY371mn.

• Revenue for 1H FY10/24 was JPY85.9bn, up 35.5% YoY, with a business profit of JPY2.2bn, up 146.1% YoY.
• RENOSY Marketplace business revenue was JPY83.6bn, up 35.3% YoY, and ITANDI business revenue was JPY2.1bn, up 34.1% YoY.
• FY10/24 company forecast revised to JPY185.0bn in revenue and JPY3.7bn in business profit, with EPS unchanged at JPY45.90.

• Sales increased by 6.0% YoY to JPY11.4bn, but net income attributable to owners decreased by 54.1% YoY to JPY359mn.
• Wholesale Sales and Retail Sales segments saw YoY profit drops, while Real Estate Management posted YoY increases in both sales and profit.
• The company sold 15 condo buildings with 369 units (+11.5% YoY) and purchased nine condo buildings with 675 units (-61.2% YoY).

• Revenue increased by 6.9% YoY to JPY8.7bn, but operating profit decreased by 9.9% YoY to JPY802mn.
• Directly Managed Beauty Salon Operation revenue grew 6.3% YoY to JPY7.2bn, while operating profit dropped significantly to JPY20mn.
• Franchise segment revenue rose 19.0% YoY to JPY1.3bn, with operating profit increasing 27.7% YoY to JPY528mn.

• Revenue increased by 2.6% YoY to JPY2.2bn, while operating profit decreased by 57.3% YoY to JPY281mn.
• SG&A expenses rose by 29.4% YoY to JPY1.1bn, leading to an operating profit margin decline to 12.6%.
• Medical device sales grew by 35.6% YoY to JPY486mn, and cosmetics sales surged by 157.9% YoY to JPY286mn.

• Given the high number of pipeline dropouts, and the potentially disappointing $6 bn psoriasis drug acquisition, we question Takeda’s recent investment track record.
• A big restructuring, high expectations from new/recently launched drug portfolio, and punchy company guidance reduces the probability of upside surprises.
• Unless you are limited from investing outside Japan and you want exposure to an innovative pharma company, we believe that there are better and cheaper options elsewhere.

• Companies with the ROE over 15% have higher market capitalization, foreign ownership, and Tobin’s Q, and naturally higher ROA, while the opposite tends to be true companies with low ROE.
• Groups with ROE above 15% have generally improved their corporate governance practices, but they still need to address their use of cash in order to further improve return on capital.
• It’s clear that companies with low ROE have the form of board practices but not the substance, and that they don’t have a clear policy for increasing return on capital.

• Revenue was JPY954mn (+32.5% YoY), with subscription-based recurring revenue at JPY837mn (+23.6% YoY), accounting for 87.8% of total revenue.
• Operating profit was JPY315mn (+94.2% YoY), with operating expenses at JPY638mn (+14.5% YoY), and OPM at 33.1% (+10.5pp YoY).
• Companywide ARR totaled JPY3.4bn (+22.7% YoY), with user count at 1,292 companies (+6.2% YoY) and churn rate at 1.05% (+0.01pp YoY).

• Revenue increased 10.8% YoY to JPY110.7bn, driven by an 8.0% YoY rise in comparable store sales and 35 new stores.
• Operating profit rose 61.8% YoY to JPY5.9bn, with OPM at 5.3%, GPM at 40.9%, and SG&A ratio down to 35.6%.
• KFC Holdings opened 51 new stores, remodeled 183 stores, and increased delivery service stores to 942, boosting system sales by 10.5% YoY.

• Revenue increased 10.8% YoY to JPY110.7bn, driven by an 8.0% YoY rise in comparable store sales and 35 new stores.
• Operating profit rose 61.8% YoY to JPY5.9bn, with OPM at 5.3%, GPM up to 40.9%, and SG&A ratio down to 35.6%.
• KFC Holdings opened 51 new stores, remodeled 183 stores, and increased delivery service stores to 942 in FY03/24.

• Revenue increased 10.8% YoY to JPY110.7bn, driven by an 8.0% YoY rise in comparable store sales and a 2.9% YoY increase in store numbers.
• Operating profit rose 61.8% YoY to JPY5.9bn, with OPM at 5.3%, GPM up 0.4pp to 40.9%, and SG&A ratio down 1.3pp to 35.6%.
• The company opened 51 new stores, remodeled 183 stores, and increased delivery service stores to 942, with system sales up 10.5% YoY.

• Revenue increased 10.8% YoY to JPY110.7bn, driven by an 8.0% YoY rise in comparable store sales and 35 new stores.
• Operating profit rose 61.8% YoY to JPY5.9bn, with OPM at 5.3%, GPM up 0.4pp to 40.9%, and SG&A ratio down 1.3pp.
• System sales grew 10.5% YoY, with customer count down 2.5% YoY and average spend per customer up 10.8% YoY.

• Revenue increased by 10.6% YoY to JPY4.0bn, with cloud services revenue up 79.3% YoY due to subscription growth.
• Operating loss was JPY109mn, pre-tax loss JPY42mn, and loss attributable to owners JPY35mn, all improved from Q1 FY12/23.
• Revised 1H FY12/24 forecast: revenue JPY8.2bn, operating loss JPY500mn, pre-tax loss JPY500mn, and loss attributable to owners JPY400mn.

• Revenue increased 10.8% YoY to JPY110.7bn, driven by an 8.0% YoY rise in comparable store sales and 35 new stores.
• Operating profit rose 61.8% YoY to JPY5.9bn, with OPM at 5.3% and GPM up to 40.9%, despite rising costs.
• KFC Holdings opened 51 new stores in FY03/24, bringing the total to 1,232, and remodeled 183 stores.

• FY03/24 revenue was JPY174.9bn (-1.9% YoY), operating profit JPY5.5bn (-34.9% YoY), and net income JPY1.6bn (-70.9% YoY).
• FY03/25 forecast: revenue JPY185.0bn (+5.8% YoY), operating profit JPY7.2bn (+31.8% YoY), net income JPY4.5bn (+181.6% YoY).
• FY03/27 targets: revenue JPY220.0bn, operating profit JPY12.0bn, recurring profit JPY12.0bn, EBITDA JPY16.4bn, ROE at least 12.0%.

• Rs Technologies (3445 JP) announced a TOB on Helios Techno Holding (6927 JP) 12 days ago. At a 74% premium, but that was too cheap. I discussed it here.
• Shares went limit up for two days then traded huge volume the first full day last Wednesday. The lowest trade so far in open trading is 3% through terms.
• 57% of Shares Out Ex-Treasury have traded in five days. Anyone who bought 5% on Day 1 has to file a Large Shareholder Report today.

• ENEOS Holdings (5020 JP) announced a deal to buy out their affiliate Tatsuta Electric Wire & Cable (5809 JP) 18 months ago. The TOB was expected to start June 2023.
• June 2023 came around and China’s SAMR still hadn’t approved. ENEOS provided quarterly updates in Sep and Dec and monthly updates since. The May update was different. 
• The May update cut the “re-update” schedule to mid-month June. There are reasons to look at what has changed since the Dec 2022 announcement. 

• 18 months after announcing the offer, ENEOS Holdings (5020 JP) secured SAMR approval for the Tatsuta Electric Wire & Cable (5809 JP) tender offer at JPY720 per share.   
• The tender offer is expected to be launched on 21 June, subject to securing the recommendation from the special committee and the Board.
• A bump is required due to the material market rerating since 21 December 2022. An offer of JPY828, a 15.1% premium to the current offer, implies a P/B of 1x.  

• i-mobile reported cumulative Q3 FY07/24 revenue of JPY16.3bn (+14.3% YoY), operating profit of JPY3.7bn (+9.2% YoY).
• Consumer Service business cumulative Q3 revenue was JPY14.2bn (+19.4% YoY), with segment profit of JPY3.5bn (+18.9% YoY).
• Online Advertising business cumulative Q3 revenue was JPY2.1bn (-11.8% YoY), with segment profit of JPY316mn (-39.3% YoY).

• In cumulative Q3 FY07/24, the company reported sales of JPY30.2bn (-30.0% YoY) and business profit of JPY1.3bn (-80.8% YoY).
• Sales from recurring revenue businesses declined 2.8% YoY to JPY18.3bn, with segment profit falling 7.3% YoY to JPY1.9bn.
• The company revised its FY07/24 year-end dividend forecast to JPY50.00 per share, including a special dividend of JPY24.00.

• Revenue: JPY13.0bn (-3.8% YoY); Operating profit: JPY185mn (+564.7% YoY); Recurring profit: JPY181mn (+449.7% YoY); Net income: JPY65mn (+67.6% YoY).
• Revenue: JPY5.5bn (-8.0% YoY); Operating profit: JPY475mn (+22.4% YoY); Segment profit margin: 8.7% (+2.2pp YoY).
• Revenue: JPY2.3bn (+19.9% YoY); Operating profit: JPY232mn (JPY104mn loss in 1H FY10/23); Segment profit margin: 9.9%.