In today’s briefing:
- Hankyu Hanshin REIT (8977) – Good Fundamental News, a Bigly Buyback, and Cascading Flows to Come
- Intloop (9556 JP) – Demonstrating Operational Leverage
- Q3 Follow-Up: Japan System Techniques (4323 JP) – March 11, 2025
- Q3 Follow-Up: Takamiya (2445 JP) – March 10, 2025
- “TSE’s Request” Catalyzes and Attracts Activist Investors to Invest
Hankyu Hanshin REIT (8977) – Good Fundamental News, a Bigly Buyback, and Cascading Flows to Come
- 3D Investment Partners launched a Partial Tender Offer to buy a 10+% stake in Hankyu Hanshin REIT, Inc. (8977 JP). The REIT finally responded with a “Neutral” stance.
- But they also upgraded earnings forecasts, bought a building, and announced the Sponsor would buy units in the market over the next year. It’s big.
- And that creates flows, which then engender other reactive flows, and cascading flows, and because the sector isn’t rich, there may be a tailwind.
Intloop (9556 JP) – Demonstrating Operational Leverage
- We believe the key highlight of Q1-2 FY7/25 results is OPM expansion YoY from 4.7% to 6.6%.
- The company aims to secure high-margin projects aligned with its strategic aims while maintaining business investment in new hires to grow.
- Business expansion via strategic alliances is bearing fruit with Itochu Corporation (8001), with other initiatives being unveiled in the food and logistics sectors to expand and diversify the solutions portfolio and accelerate growth.
Q3 Follow-Up: Japan System Techniques (4323 JP) – March 11, 2025
- Japan System Techniques (hereafter, the Company) announced its Q3(9M)
- Key consolidated figures net sales of JPY 20,549 mn (+10.9% YoY), operating profit of JPY 2,041 mn (+26.5% YoY), ordinary profit of JPY 2,116 mn (+28.4% YoY), and profit attributable to owners of parent (hereafter, net profit) of JPY 1,417 mn (+28.9% YoY).
- Higher sales and profits in the DX&SI business and Package business contributed in Q3 earnings growth.
Q3 Follow-Up: Takamiya (2445 JP) – March 10, 2025
- Q3 FY2025/3 Earnings results summary: Takamiya (hereafter, the Company) reported its Q3(9M) FY2025/3 consolidated earnings results: sales of JPY 32,335 mn (+0.5% YoY), operating profit of JPY 1,316 mn (-45.3% YoY), ordinary profit of JPY 1,209 mn (-52.1% YoY), and profit attributable to owners of parent (hereafter, net profit) of JPY 867 mn (-49.8% YoY).
- Due to the postponement of the large-scale projects’ commencements, rental volumes fell short of initial expectations.
- Additionally, due to delays in the delivery schedule of sales and OPE-MANE projects, the net sales saw only a slight increase.
“TSE’s Request” Catalyzes and Attracts Activist Investors to Invest
- When investing in a larger company, one can expect higher liquidity, higher expectations of endorsement of the activist investor’s views because of the large institutional holdings, and smoother communication.
- As cross-shareholding structures are beginning to break down, there’re many opportunities for activist investors to attack such companies because they couldn’t create value and grow due to underutilization of resources.
- Activist investors have invested in Japanese companies in the past, but never with such success. This success is largely due to a change in the environment.
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