In today’s briefing:
- Last Week in Event SPACE: Kesei/Oriental Land, Intouch, Abacus Property, Great Eagle, JS Global
- The Problem Is that Many Managers Know that ROE Is Below Cost of Capital but Are Not Taking Action
Last Week in Event SPACE: Kesei/Oriental Land, Intouch, Abacus Property, Great Eagle, JS Global
- Activist investor influence in distributing Keisei Electric Railway Co (9009 JP)‘s ¥1,980bn Oriental Land (4661 JP) stake to existing shareholders could unleash over 150% potential upside
- Intouch Holdings (INTUCH TB) is coming up cheap versus Advanced Info Service (ADVANC TB). Yet the longer-term view suggests otherwise.
- Abacus Property (ABP AU) confirmed the spin-off of an ASX-listed self-storage REIT with A$3bn in total assets. There’s a trade here.
The Problem Is that Many Managers Know that ROE Is Below Cost of Capital but Are Not Taking Action
- The essence of problem lies in the fact that even half of them believe that ROE doesn’t exceed cost of capital, yet managers haven’t taken measures to address this problem.
- In reality, management reform is still a long way off, as constructive proposals from shareholders are often not accepted until the % of foreign shareholders rises to the 30% level.
- TSE has made it possible to compare the superiority of management skills with share price. Attention will be focused on how managers will answer questions about share prices at AGMs.
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