In today’s briefing:
- Aisin (7259 JP): The Current Playbook
- JAPAN ACTIVISM: Murakami Target Mitsui Matsushima Cleans Up
- Onward Holdings (8016 JP): Q1 FY02/25 flash update
- Whether Measures to Meet TSE’s Request Increased Certainty Will Be Tested at 2Q Financial Reporting
- Bike O & Co Ltd (3377 JP): 1H FY11/23 flash update
Aisin (7259 JP): The Current Playbook
- Since the US$1.1 billion secondary placement announcement, Aisin (7259 JP)’s shares are up 2.5% from the undisturbed price of JPY5,243 per share (27 June).
- Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Aisin’s shares have deviated from the pattern of previous large placements.
- The offering will likely be priced on 8 July. Investors who have participated in previous large Japanese placements tend to secure positive returns.
JAPAN ACTIVISM: Murakami Target Mitsui Matsushima Cleans Up
- On 20 May, I wrote that Japanese activist MURAKAMI Yoshiaki and relations/affiliates had gone from 5% to 20% of Mitsui Matsushima (1518 JP) in 5 trading days.
- I wondered if it was real, or a pump & dump, but they went to near 30% in following days. THEN they drifted off as Murakami-Fille sold while Murakami-Père bought.
- The reasoning was not clear, but the story had real potential. Still does. Today, shareholders got more good news.
Onward Holdings (8016 JP): Q1 FY02/25 flash update
- Sales rose JPY1.5bn YoY (+2.9% YoY) to JPY51.4bn, driven by higher sales in domestic and overseas apparel businesses.
- Operating profit decreased JPY306mn YoY (-5.7% YoY) to JPY5.1bn due to a decline in domestic profit and wider overseas losses.
- Full-year forecasts revised for recurring profit and net income attributable to owners of the parent, reflecting better-than-expected affiliate performance.
Whether Measures to Meet TSE’s Request Increased Certainty Will Be Tested at 2Q Financial Reporting
- If a company hasn’t improved its return such as ROE, it’s difficult to buy its shares until the plan is more certain that cash flow will expand in the future.
- Since cash flow margin must be raised to increase cash flow, the ultimate goal is to achieve sales growth while raising the profit margin on sales.
- Cutting costs alone isn’t enough; cash must be used for investments that will lead to future growth, so cash must be used for growth investments as well as stock repurchases.
Bike O & Co Ltd (3377 JP): 1H FY11/23 flash update
- In 1H FY11/24, revenue was JPY16.5bn (-5.5% YoY), with an operating loss of JPY244mn and net loss of JPY146mn.
- Wholesale revenue was JPY8.7bn (-17.1% YoY), retail revenue JPY6.5bn (-0.7% YoY), and other revenue JPY1.3bn (+191.1% YoY).
- SG&A expenses totaled JPY6.3bn (+4.3% YoY), with selling expenses at JPY2.4bn (-2.9% YoY) and personnel expenses JPY2.2bn (+4.9% YoY).
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