Japan

In today’s briefing:

KDDI (9433) – Own Share Tender Offer, Toyota To Sell (Gasp!)
JSR Corporation (4185 JP): Tender Offer Risk/Reward
Fanuc (6954) | Earnings Miss; Guidance Slashed
Investors Should Continue to Demand that Comparable and Necessary Human Capital Disclosures Are Made

KDDI (9433) – Own Share Tender Offer, Toyota To Sell (Gasp!)

Today, with Q1 earnings, which I found less than great, KDDI Corp (9433 JP) announced a Tender Offer Buyback to repurchase up to 64,102,500 shares for up to ¥250.03175bn.
The Tender Offer – at ¥3900/share vs Last at ¥4,271/share (designed for cross-holding unwinds) – goes from 31-July through 28-August. It fills the 83.3% of the buyback programme announced 11-May.
Toyota Motor (7203 JP) has announced it would sell ¥250bn of shares into this Tender Offer. This is less interesting than it looks. The whole thing is.

JSR Corporation (4185 JP): Tender Offer Risk/Reward

JSR Corp (4185 JP)‘s pre-conditional tender offer from JIC is JPY4,350 per share. Since the deal announcement on 26 June, the gross spread has averaged 6.4%.
The wide gross spread reflects the risk in satisfying the pre-conditions related to country approvals, particularly in China. JIC, unusually can waive all or part of the conditions precedent.
The wild card is geopolitical developments. There are three China approval scenarios. The likely scenario is the deal approval under a normal procedure with a delay to the tender start.

Fanuc (6954) | Earnings Miss; Guidance Slashed

By Mark Chadwick

Fanuc reported 1Q3/24 operating profit of ¥32.6 billion (-26.3% YoY), missing street expectations at around ¥43 billion
Fanuc cut full year guidance for operating profit to ¥118 billion (-38% YoY), way below street estimates of ¥176 billion
Turning bearish. We think the stock will essentially tread water given lack of catalysts over next 6-9 months and valuations

Investors Should Continue to Demand that Comparable and Necessary Human Capital Disclosures Are Made

Few companies disclose human capital quantitatively, and most do so in text without numbers. Rarely do companies like Sysmex show how much added value their human capital investments have generated.
To ensure that information necessary to understand how much value investment in human capital creates is disclosed, investors should scrutinize annual securities reports to identify areas for improvement in disclosure.
Human capital and diversity disclosures are not available in a database. Allowing comparisons over time in the same company and comparative analysis with other companies will advance companies’ efforts.

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Jul 30

Daily Brief Japan: NTT (Nippon Telegraph & Telephone) and more

In today’s briefing:

Last Week in Event SPACE: NTT, Delta Electronics, Fortescue Metals, Nomura Real Estate

Last Week in Event SPACE: NTT, Delta Electronics, Fortescue Metals, Nomura Real Estate

By David Blennerhassett

NTT (9432 JP) will likely buy back more shares than previously expected as the government sells shares down. Buy dips vs peers KDDI and Softbank Corp. This is a long-term tilt.
There are some doubts over the fate of Delta Electronics Thai (DELTA TB)‘s SET50 membership, at present, but it should escape deletion in December 2023.
Don’t punt Fortescue Metals (FMG AU) on the off-chance of a change of control in the wake pf the Forrest split. If anything, there might be a leakage of shares.

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Jul 29

Daily Brief Japan: Softbank Group, Restar Holdings Corporation, Tokyo Stock Exchange Tokyo Price Index Topix and more

In today’s briefing:

SoftBank Group (9984 JP) – Reasons to Be Careful
Restar Holdings (3156) – Seeking Higher Returns Through Business Reorganization
Employee Stock Compensation Plans Need to Be Designed to Increase Employee Engagement

SoftBank Group (9984 JP) – Reasons to Be Careful

By Victor Galliano

The SoftBank share price rally is, in our view, based on optimism around the Arm IPO, the Yen’s relative weakness and recovering share prices of public companies in the portfolio
Nvidia’s emergence as a potential anchor investor in the Arm IPO has boosted SoftBank shares, yet there is still a big disparity between groups in terms of Arm’s potential valuation
Aside from a recovery in public tech companies’ shares, Yen weakness has supported SoftBank’s asset values; monetary policy moves now indicate the prospect of a stronger Yen versus the USD

Restar Holdings (3156) – Seeking Higher Returns Through Business Reorganization

By Astris Advisory Japan

Restar is a semiconductor and electronic components trading company with a historical affiliation to Sony (6758) as an authorized dealer, catering to a diverse and global customer base.
In May 2023, it announced an ambitious and expansive strategic initiative for business reorganization.
These initiatives include organizational changes from a holding company to an operating company, structural reforms, making ROIC (Return on Invested Capital) a critical management key performance indicator (KPI), and creating growth opportunities targeting the automotive and industrial sectors.

Employee Stock Compensation Plans Need to Be Designed to Increase Employee Engagement

Employee motivation is reflected in the fact that employee salaries have barely increased in 10 years (employee engagement in Japan has been 5% for four consecutive years).
First, employee salaries must be increased. Even during deflation, the consumption tax has been raised twice in the past decade, and the national burden rate has also increased.
When introducing employee stock compensation plan, it will be necessary to make sure that the plan is not only designed to supplement employee pay, but also to increase employee engagement.

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Jul 28

Daily Brief Japan: Toshiba Corp, Nomura Real Estate Master Fund,, Genda Inc, Mizuho Financial Group, Tokyo Stock Exchange Tokyo Price Index Topix, Takeda Pharmaceutical and more

In today’s briefing:

Toshiba (6502) Tender – Certainly Cheaper. Maybe Delayed, But Toshiba Fatigue Is Strong
Nomura Real Estate To Buy Nomura RE Master Fund Units
Genda IPO Trading – Stronger Subscription Rates than the Recent Large JP IPO
Mizuho – Tax Rate Normalization, Yield Curve Control Relief, Can Mean Profit Surge
Solving Gender Gap in Higher Education Is Key, as Political Leadership Can’t Be Count On
Takeda: Earnings Beat Driven by Key Drugs and Dengue Vaccine Seeing Positive Momentum

Toshiba (6502) Tender – Certainly Cheaper. Maybe Delayed, But Toshiba Fatigue Is Strong

It has been four months since JIP officially announced their intention to launch a Tender Offer for Toshiba Corp (6502 JP) by end-July. 7 weeks since Toshiba’s Board supported it.
There’s been no material public griping. Peers are sharply higher. There have been news stories suggesting a Western Digital/Kioxia deal is close. That’s now extended. The Toshiba deal possibly too.
But huge outperformance by peers, and possible clarity from Kioxia deal terms are unlikely to move the Toshiba Board to demand more.

Nomura Real Estate To Buy Nomura RE Master Fund Units

Today, Nomura Real Estate Master Fund, (3462 JP) – the largest REIT in the ‘Diversified REIT’ JREIT space – announced sponsor Nomura Real Estate (3231 JP) would up its stake.
They would lift their stake from 4.47% by 2.54% to 7.01%. There is a reason for this, just like there was last time with Japan Excellent (8987 JP).
Understanding the reason is how you understand the trade to do.

Genda IPO Trading – Stronger Subscription Rates than the Recent Large JP IPO

By Clarence Chu

Genda Inc (9166 JP) raised around US$100m in its Japan IPO.
Genda develops and operates amusement facilities in Japan, primarily operating under its Genda GiGO Entertainment subsidiary.
In this note we will talk about the trading dynamics.

Mizuho – Tax Rate Normalization, Yield Curve Control Relief, Can Mean Profit Surge

By Daniel Tabbush

Mizuho’s current tax expenses can see normalization that restores profitability by June quarter
Yield curve control relief coming at a time of tax normalization, can be significant to profit
Credit costs have moved higher, but the magnitude may wane, given NPL distribution

Solving Gender Gap in Higher Education Is Key, as Political Leadership Can’t Be Count On

By Shifara Samsudeen, ACMA, CGMA

Unless 10% male/female of lawmakers, is changed, the quota system cannot be expected to be introduced. It’s not easy to replace male incumbents who have vested interests with female candidates.
Gender wage gap relies on the low number of female managers, but there’s no sense of acceleration in the government’s goal of achieving 30% of female managers by 2030.
The gender gap in higher education is affecting female managers and the gender wage gap. It’s important to solve this fundamental problem by providing equal higher educational opportunities through scholarships.

Takeda: Earnings Beat Driven by Key Drugs and Dengue Vaccine Seeing Positive Momentum

Takeda Pharmaceutical (4502 JP) reported 1QFY03/2024 results today. Revenue increased 8.9% YoY to ¥1,058.6bn (vs consensus ¥989.8bn) while OP increased 12.0% YoY to ¥168.6bn (vs consensus ¥123.5bn).
The topline growth was driven by growth & launch products which accounted for 40% of total revenues, and increased 16.2% YoY during the quarter at constant exchange rates.
Takeda is expecting 7-8 key regulatory decisions during the current fiscal year and we expect dengue vaccine and other new launches to help offset revenue loss from upcoming patent expiry.

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Jul 27

Daily Brief Japan: Rakuten Group , CyberAgent Inc, Torex Semiconductor and more

In today’s briefing:

July TOPIX FFW Rebal – Update With 2 Days To Go on $3bn a Side
CyberAgent 3Q: Gaming Collapses and Spurs Downward Revision
Full Report – Torex Semiconductor (6616 JP)

July TOPIX FFW Rebal – Update With 2 Days To Go on $3bn a Side

By Shifara Samsudeen, ACMA, CGMA

In the two weeks since the announcement, Large ADDs (>2d ADV, >$5mm) have outperformed Large DELs by 1.3%. Smaller ADDs vs DELs (>2d, >$2<$5mm) have outperformed by 1.3%.
Using only >$20mm >2d DELs vs Top 5 $amt >2d ADDs, that’s a bit better than 1%. And the really obvious large ones? Not so obvious.
There is still a large reverse funding trade, with some large sells.

CyberAgent 3Q: Gaming Collapses and Spurs Downward Revision

CyberAgent Inc (4751 JP) reported 3QFY09/2023 results today. Revenue decreased 0.2% YoY to ¥171.7n (vs consensus ¥177.8bn) while operating income decreased 86.2% YoY to ¥1.4bn (vs consensus ¥11.0bn).
The game business has further deteriorated during 3Q with the absence of hit title launches and drop in UMA MUSUME Rankings. Segment reported losses during the quarter.
CA has opened pre-registrations for two new games, we are not convinced that these could become top performers as the company has not given a hit title since UMA MUSUME.

Full Report – Torex Semiconductor (6616 JP)

By Sessa Investment Research

Since 1H FY24/3 corresponds with the bottom of the current reset cycle, initial guidance for net sales is -9.3% YoY.
In addition to ongoing high electricity rates, depreciation expense is set to increase +51.1% YoY, and initial guidance for OP is -62.3% YoY.
On a cash flow basis, implied EBITDA is forecast to decline -29.1% YoY.

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Jul 26

Daily Brief Japan: NTT (Nippon Telegraph & Telephone), Shimano Inc, Terumo Corp, Lasertec Corp, Tokyo Stock Exchange Tokyo Price Index Topix, D.Western Therapeutics Institute Inc., Oisix ra daichi and more

In today’s briefing:

NTT (9432) – LDP Consideration of Full Sale Is Not Necessarily Overhang
Shimano (7309) | Profit Recovery Derailed
Terumo Corp (4543 JP): Strong C&V Business Momentum Continues; Profitability to Improve in FY24
Alphawave, TSMC and Lam Research Follow-up, DISCO and Lasertec
Why Do Only 13% of Companies Mention P/B in Mid-Term Management Plans While Half Had P/Bs Below 1x?
News Flash – D. Western Therapeutics Institute (4576 JP)
Oisix: Meal Kit Kaizen

NTT (9432) – LDP Consideration of Full Sale Is Not Necessarily Overhang

Six weeks ago, LDP Policy Research Council chairman KAGIUDA led a discussion about full NTT privatisation to fund defence. Today he said serious deliberations begin in August. Shares fell today.
The LDP wants non-tax resources to increase defence/social spending. Selling would require a change in NTT Law, but the argument is that communications have changed/internationalised.
As discussed in NTT (9432 JP) – Would the Govt Sell All Its Shares? Why? How? How Long? Overhang?, there are questions on overhang. BUT… presumably there are mitigants.

Shimano (7309) | Profit Recovery Derailed

By Mark Chadwick

Shimano reported a 40% drop in operating profit for 2Q and revised down full year guidance
Bike sales continue to be weak (-19% YoY) in Q2 and 2H outlook is even worse
We expect the share price to sell-off following the guidance cut. The inventory overhang could take a while to resolve

Terumo Corp (4543 JP): Strong C&V Business Momentum Continues; Profitability to Improve in FY24

By Tina Banerjee

Terumo Corp (4543 JP) recorded highest ever revenue and operating profit in FY23, driven by continued strong growth in C&V business globally, particularly the largest U.S. market.
C&V business should continue to be the primary driver of Terumo’s growth in FY24 also. The company has guided for C&V revenue of ¥504B in FY24, up 5% YoY.
Terumo aims to grow profit by double-digit percentage in FY24 and improve profitability through expansion of high-margin products, more assertive pricing policies, and cost reduction measures centered on manufacturing cost.

Alphawave, TSMC and Lam Research Follow-up, DISCO and Lasertec

By Douglas O’Laughlin

Alphawave reported last week.
The results were not good; they were great.
I actually am excited to see Tony and the team execute like this. Bookings are growing, and while revenue has not come out yet, it seems very likely they will hit their 2023 revenue estimates.

Why Do Only 13% of Companies Mention P/B in Mid-Term Management Plans While Half Had P/Bs Below 1x?

Considering that about half of the listed companies had P/Bs below 1x, the fact that 13% of the companies that published medium-term management plans mentioned P/Bs is too small.
More companies should mention ROE in mid-term business plans, but the reason they don’t is because they recognize that the company isn’t generating return that exceeds its cost of capital.
While P/B is rising due to rising stock prices, foreign ownership is increasing. In exchange, managers must realize that they need to develop measures for sustainable expansion of corporate value.

News Flash – D. Western Therapeutics Institute (4576 JP)

By Sessa Investment Research

DWTI announced that it has updated its development pipeline on DW-1002 licensee Dutch Ophthalmic Research Center (DORC) announcing its decision to develop MEMBRANEBLUE-DUAL® in the US for the indication of ILM and ERM membrane staining during vitreoretinal surgery.
Since the DW-1002 single-agent formulation TissueBlueTM was launched in the US in 2020, it has been used in over 100,000 surgeries and is preferred by over 40% of U.S. retinal surgeons.
Combination ophthalmic surgical aid MEMBRANE BLUE-DUAL® (DW-1002 Brilliant Blue G + Trypan Blue) has been used in over 500,000 surgeries in Europe since its launch in 2010.

Oisix: Meal Kit Kaizen

By Michael Causton

Oisix Ra Daichi is by far Japan’s largest online food retailer, driven by the popularity of its fresh food and meal kit subscription services.
Despite some backend problems last year, the company expects its system of continual improvement and expansion of new lines of meal kits to bring strong growth in the medium term.
The development of the online food market should help boost the company’s prospects. Operating margins have worsened considerably but the company hopes to match the previous peak this year.

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Jul 25

Daily Brief Japan: Rakuten Securities, JPY, SCREEN Holdings, Oriental Land, Santen Pharmaceutical and more

In today’s briefing:

Rakuten Securities IPO: The Bear Case
Japan Watch: The pros and cons for Ueda
Screen Holdings (7735 JP): Export Restrictions Add to Uncertainty
Oriental Land: A Potential Beat Next Quarter, but Unrealistic Consensus for Long-Term
Santen Pharmaceutical (4536 JP): Aims to Ride Patent Cliff Through Focus on Improving Profitability

Rakuten Securities IPO: The Bear Case

Rakuten Securities (RAKUSEC JP), a leading Japanese online brokerage, seeks to raise US$500 million. Rakuten Group (4755 JP) (80.01%) and Mizuho Financial Group (8411 JP) (19.99%) are its shareholders.
In Rakuten Securities IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
The key elements of the bear case rest on rapidly slowing operating revenue and commissions growth, lowest per-account monetisation rates vs peers and mid-tier profitability.

Japan Watch: The pros and cons for Ueda

By Andreas Steno

The JPY market is one big roller-coaster at the moment as the market constantly tries to sniff out potential clues on when the Bank of Japan will catch up to the rest of the G10 central banks with a tighter policy.
In this piece, we look at the pros and cons of moving already this Friday for the Bank of Japan, but let’s take a look at the current back-drop before we move to the actual policy decision.
Markets started pricing in an elevated risk of a further increase to the yield-curve-control cap on Friday after a spike in wage data three weeks ago.

Screen Holdings (7735 JP): Export Restrictions Add to Uncertainty

By Scott Foster

Japan’s new restrictions on exports of semiconductor production equipment to China are a potential threat to Screen.
TSMC’s announcement that 2023 capex is likely to be at the low end of the forecast range is another negative.
Share price consolidation should continue until guidance is lowered or verified.

Oriental Land: A Potential Beat Next Quarter, but Unrealistic Consensus for Long-Term

By Oshadhi Kumarasiri

There is a possibility that Oriental Land (4661 JP)‘s revenue and OP in 1QFY24 could surpass the consensus estimates by 8% and 21%, respectively.
However, the outlook for the next three quarters may be different, as consensus appears inflated with annual OP expectations of ¥154.5bn compared to the company’s guidance of ¥122bn.
We find medium term consensus expectations unrealistic, leading to potential downside for Oriental Land. We expect FY+2 EV/OP to decline from 46x to 20-30x.

Santen Pharmaceutical (4536 JP): Aims to Ride Patent Cliff Through Focus on Improving Profitability

By Tina Banerjee

Santen Pharmaceutical (4536 JP) expects generic competition for mainstay product in Japan in FY24, while overseas business should continue stable growth. The company guided for FY24 revenue of ¥273B (-2%).
Due to the absence of impairment loss, Santen is expected to report operating profit of ¥32B in FY24 from an operating loss of ¥3B in FY23.
Santen has unveiled new medium-term management plan, which calls for revenue of ¥280B, core operating profit of ¥56B, core ROE ratio of 13%, and core EPS growth rate of 10%+.

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Jul 24

Daily Brief Japan: JSR Corp, Rakuten Group , NSK Ltd and more

In today’s briefing:

Merger Arb Mondays (24 Jul) – JSR, 111, Estia, Newcrest, InvoCare, Origin, Golden Eagle, Dali Foods
Weekly Deals Digest (23 Jul) – Rakuten Securities, Tryt, EbixCash, Lalatech, 111, Newcrest, Origin
Share Buyback Are Likely Due to Reduction of Shares in Retirement Benefit Trusts and Policy Holdings

Merger Arb Mondays (24 Jul) – JSR, 111, Estia, Newcrest, InvoCare, Origin, Golden Eagle, Dali Foods

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 – Chindata Group (CD US), Estia Health (EHE AU), 111 Inc (YI US), ENM Holdings (128 HK), JSR Corp (4185 JP), Costa Group Holdings (CGC AU).
Lowest spreads Healius (HLS AU), Liontown Resources (LTR AU), Toyo Construction (1890 JP), Penguin International (PBS SP), ARTERIA Networks Corp (4423 JP), Inner Mongolia Yitai Coal Company Ltd (3948 HK).

Weekly Deals Digest (23 Jul) – Rakuten Securities, Tryt, EbixCash, Lalatech, 111, Newcrest, Origin

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 – Tryt Inc (9164 JP), Rakuten Securities (RAKUSEC JP), EbixCash (EBIXC IN), Lalatech Holdings Co Ltd (LALA HK), Alibaba (ADR) (BABA US)‘s Cainiao & Cloud Intelligence Group IPOs.
Event-Driven developments – 111 Inc (YI US), Healius (HLS AU), Invocare Ltd (IVC AU), Newcrest Mining (NCM AU), Origin Energy (ORG AU).

Share Buyback Are Likely Due to Reduction of Shares in Retirement Benefit Trusts and Policy Holdings

It’s difficult to justify the low ROE based on criteria for judging reasonableness of NSK’s policy-shareholdings: “NSK will reduce policy-shareholdings that aren’t rationale for increasing corporate value over mid-to-long term.
For NSK with a market capitalization of just under 500 billion yen, 50.1 billion yen in policy stockholdings plus 128.3 billion yen in retirement benefit trust shares is too much.
Based on past performance trends, the ROE is not expected to rise all at once as profits recover, but the company may continue to raise shareholder returns through share repurchases.

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Jul 23

Daily Brief Japan: SBI Shinsei Bank, Tryt Inc, ROHM Co Ltd, Keisei Electric Railway Co, Rakuten Group and more

In today’s briefing:

SBI Shinsei Bank (8303) Calls Its EGM and Appraisal Rights Seekers Prepare for Battle
TRYT IPO: Trading Debut
Rohm (6963): Investment in Toshiba Rounds Out Long-Term Plans
Last Week in Event SPACE: Takisawa Machine Tools, Kesei Electric/Oriental, Shenzhen Int’l/Way, HMM
ECM Weekly (23rd July 2023) – Tryt, Genda, Rakuten, Mobovi, Samhi, Indigo, Federal Bank, Invincible

SBI Shinsei Bank (8303) Calls Its EGM and Appraisal Rights Seekers Prepare for Battle

The SBI Holdings Tender Offer for SBI Shinsei Bank (8303 JP) was completed about four weeks ago, and in something of a surprise, only 3.7% of 26.98% minority holdings tendered.
The stock traded above terms every day during the Tender Offer Period. People accumulated in order to pursue their appraisal rights later. That is big.
This week, SBI Shinsei announced the schedule of dates relating to the squeezeout EGM. The record date was early. The reverse stock split announced is as expected, possibly game-able.

TRYT IPO: Trading Debut

Tryt Inc (9164 JP) priced its IPO at JPY1,200 per share to raise gross proceeds of US$339 million. The shares will start trading on 24 July.
We previously discussed the IPO in TRYT IPO: The Bull Case, TRYT IPO: The Bear Case, TRYT IPO: Valuation Insights and TRYT IPO: Revised IPO Price Range Remains Unattractive.
The market sentiment on the sector has broadly remained unchanged since the release of the prospectus. Our analysis suggests that Tryt is, at best, fully priced at the IPO price.

Rohm (6963): Investment in Toshiba Rounds Out Long-Term Plans

By Scott Foster

As expected, Rohm has decided to invest ¥300 billion in the JIP-led buyout of Toshiba: ¥100 billion in voting equity shares and ¥200 billion in non-voting preferred shares.
This would make Toshiba an equity-method affiliate of Rohm, facilitating synergetic cooperation in power semiconductors. The investment is large, but Rohm would still have a sound balance sheet.
Rohm also plans to buy Solar Frontier’s Kunitomi factory to meet SiC power device capacity requirements through 2030. Investors can now focus on profit growth, which should resume next year.

Last Week in Event SPACE: Takisawa Machine Tools, Kesei Electric/Oriental, Shenzhen Int’l/Way, HMM

By David Blennerhassett

Keisei Electric (9009 JP)‘s valuation has deviated from Oriental Land (4661 JP)‘s since the proposed expansion of Tokyo Disney Sea, Fantasy Springs. That bifurcation should now reverse.
Don’t expect a serious fight in Nidec (6594 JP)‘s hostile for Takisawa Machine Tool (6121 JP). Fanuc could counter. It is possible others could step up but we wouldn’t know.
On the back of the news to spin off and list some logistics ops, Shenzhen International (152 HK) is probably a buy on weakness vs Stub Ops Peers.

ECM Weekly (23rd July 2023) – Tryt, Genda, Rakuten, Mobovi, Samhi, Indigo, Federal Bank, Invincible

By Sumeet Singh

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
In the IPO space, the coming week will see Tryt Inc (9164 JP) and Genda Inc (9166 JP) listing, along with Fadu (440110 KS) bookbuild.
For placements, Japan and India placements continue to flow, while there are no signs of any major Hong Kong activity.

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Jul 22

Daily Brief Japan: Nippon Paint Holdings, Tokyo Stock Exchange Tokyo Price Index Topix and more

By Shifara Samsudeen, ACMA, CGMA

In today’s briefing:

Nippon Paint (Part I): A Deep Dive into NP’s Japan Business
Growth in Corporate Value over Longer Term Is More Important than Meeting Immediate Listing Criteria

Nippon Paint (Part I): A Deep Dive into NP’s Japan Business

This is the First of a series of reports on Nippon Paint Holdings (4612 JP) and in this insight, we deep dive into the company’s Japanese business.
The automotive coating biz in Japan is heavily reliant on the domestic automotive market while decorative paints is facing challenges due to slowdown in population in the country.
The outlook for Japan biz remains stagnant with growth rates slowing down and margins on a downward trend.

Growth in Corporate Value over Longer Term Is More Important than Meeting Immediate Listing Criteria