Daily Brief Industrials: Mitsui & Co Ltd, TBEA Co Ltd A, Intloop , Steelcase Inc Cl A, Toro Co and more

• Today after the close, Mitsui & Co Ltd (8031 JP) announced that MS&AD Insurance (8725 JP) and Sumitomo Mitsui Financial Group (8316 JP) would sell 14.9mm shares in an offering.
• This will get priced today or tomorrow, sold to institutional investors. This is ¥107bn, 4 days of ADV and 1% of shares out. It is not dilutive. 
• Mitsui & Co has a buyback program with ¥123bn left til end-Sep, when presumably it will reload. Looks easy today, but measuring Mitsui & Co vs Peers is less flattering.

• MS&AD Insurance (8725 JP) and Sumitomo Mitsui Financial Group (8316 JP) are looking to raise US$691m from trimming their respective stakes in Mitsui & Co Ltd (8031 JP).
• While this appears to be another cross-shareholding unwind in Japan, we would argue that the selldown isn’t outright well-flagged given the uncertainty of timing the selldown.
• In this note, we will talk about the placement and run the deal through our ECM framework.

• SSE 50 and SSE 180, respectively, aim to represent the performance of the 50 and 180 largest and most liquid A-share stocks listed on the Shanghai Stock Exchange.
• In this insight, we take a look at the names leading the race to become ADDs and DELs during the December 2024 index rebal event.
• We currently estimate one-way flows to be US$1.4bn and US$235mn for the SSE 50 and 180, respectively.

• Q1-3 FY7/24 results were in line with unchanged guidance. Gross margin increased from 22.9% to 24.0% YoY, a positive development as the company selectively raised consultant prices.
• With the scope for further increases, we believe the company can achieve sustainable double-digit sales growth in the medium term.
• Profitability is also set to improve via pricing as well as 1) scaling the newly-established strategic consulting subsidiary with high gross margins and 2) improving the sales mix by growing direct business with customers, as opposed to solely acting as freelancers and providing staff from business partners. 

• We introduce our new revenue and earnings estimates and full financial model following
• Steelcase’s 1QFY25 earnings beat versus consensus and WTR estimates.
• Steelcase posted 1QFY25 adjusted EPS of $0.16 versus $0.09 in 1QFY24, beating consensus of $0.10 and our estimate of $0.11.

• TTC sells gas-powered outdoor power equipment to professional customers with Pro sales being the main source of revenue
• They also serve residential customers and have a wide range of products including mowers, snow equipment, and large machinery for infrastructure markets
• A key focus of the short case against the company is their involvement in providing credit extension through quasi-off-balance sheet financing vehicles like Red Iron

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.