Daily Brief Japan: Japan Post Holdings, S Line Co Ltd, Nihon Kohden, Recruit Holdings, TSE Tokyo Price Index TOPIX, yutori , Pan Pacific International Holdings, Pakuwon Jati and more

• Today, Japan Post Holdings (6178 JP) announced results (and Mar25 guidance) as did its subsidiaries Japan Post Insurance (7181 JP) and Japan Post Bank (7182 JP). 
• There are a number of interesting things in all the announcements/presentations but the most interesting one for JPH holders is a big buyback. Another one.
• The company has announced a ¥350bn buyback. It is larger than last year’s (¥300bn) buyback and has another important difference.

• Today, S Line Co Ltd (9078 JP) announced its CEO would conduct a Tender Offer MBO to buy out the ¥50bn-target revenue logistics company, at 0.6x book. 
• The company announced results with revenues up. But withdrew its existing MTMP which said revenues would be up 10% from here to March 2025 and ROE would be higher.
• This is the wrong price. It should engender some upset, but active investors own almost nothing it seems. 

• In FY25, Nihon Kohden (6849 JP) guided for domestic revenue of ¥147B, up 3% YoY. The demand for patient monitors and treatment equipment is expected to remain steady.
• Nihon Kohden expects North America business to report a revenue CAGR of 11% (fastest among all the other regions) during FY24–27, outpacing mid-single-digit growth of the market.
• The company announced ¥10B buyback plan to repurchase up to 6M shares, representing 3.57% of total number of issued shares from August 5, 2024, to March 31, 2025.

• Recruit Holdings (6098 JP) reported 4Q and full-year FY03/2024 results today. Earnings beat own guidance as well as consensus estimates.
• Weakening labour markets have negatively impacted all business segments and new pricing model for Indeed has not really been successful.
• Recruit expects a recovery in 2HFY03/2025, but at the rate at which job openings are going down, we remain cautious.

• Code of Corporate Conduct lacks explanation of the role to be played by a listed company and the background. Consequently, there’re cases where the same companies have repeatedly committed misconduct.
• For companies that are good at pretending that they are trying, without any substance to their corporate governance, making the provisions of Corporate Governance Code mandatory effort won’t be effective.
• TSE’s request seems to be an effort obligation. It is good that the substance of the company’s improvement plan, which only made an effort to improve, will be improved.

• Yutori , the Zozo-controlled online fashion mall, is diversifying into cosmetics and other items, with wholesale distribution to chain stores as well as sales through its own mall.
• The fledgling online mall continues to grow fast, with sales up 74% so far this year.
• It is in essence Zozo 20 years ago given its focus on the teen and youth market but with the difference in that it has Zozo’s experience and advice.

• There were many sceptics when Don Quijote bought Uny given that no other GMS retailer was performing well.
• Today, Uny is finding new relevance thanks to the adoption of merchandising and marketing from Don Quijote.
• But the real secret ingredient is, as in Donki stores, giving staff the freedom and responsibility they always wanted – including profitability of each store.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

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