Daily Brief Japan: Nippon Express Holdings, Yaizu Suisankagaku Industry, Advantest Corp, JPY, Jafco Co Ltd, T&D Holdings, Monex Group Inc, Lawson Inc, Kumiai Chemical Industry Co and more

• The Offering priced today at ¥7,338/share vs ¥8,039/share traded at the close on the day of the announcement. That’s an 8.7% discount for no dilution. 
• Compared to a broad basket of Peer Baskets (yes, a basket of baskets), the stock has underperformed by 4.2%, and the 3% discount today puts it at 7+% move.
• Given the relative cheapness, one should be comfortable putting this on if it gets sold off. This is not different to my initial opinion.

• Inaba has bumped its Yaizu Suisankagaku Industry (2812 JP) offer by 6.5% to JPY1,438 and lowered the minimum number of shares to be purchased from 66.67% to 60.00% ownership ratio.
• The bump was forced by 3D Investment Partners increasing its shareholding from 9.78% to 13.81% ownership ratio after the previous JPY1,350 offer was announced on 5 February.
• While the offer continues to value YSK below book value, Murakami and 3D’s support paves the way for completion. At the last close, the gross spread was 7.1%.  

• Advantest has dropped back 11.5% from its recent high but is still up 43% year-to-date and up 2.3X from a year ago. Consolidation is likely to continue.
• Demand for High Bandwidth Memory (HBM) for use with AI processors could lift sales, profits and profit margins to new highs within the next two years.
• That could bring the projected P/E ratio down from 75.5x FY Mar-24 EPS guidance to 31x FY Mar-26 EPS in a favorable but not unreasonably optimistic scenario. 

• The yen has been the worst performing currency this year, but has been trading in a tight range around 150 against the dollar.
• Recent developments suggest the Bank of Japan may make policy changes in March or April, possibly exiting negative rates.
• Market may be getting ahead of itself with expectations for a hawkish shift from the BOJ, potentially leading to short-lived movements in the dollar-yen pair.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• Core business well positioned to benefit from the growth in the Japanese VC industry
• A good Partner for international firms looking to invest in Japan
• New direction on Capital Allocation is underappreciated by the market

• Jafco Co Ltd (8595 JP) is the largest specialist venture capital company in Japan.
• In FY03/23, JAFCO reported revenue of JPY14.1bn, an operating loss of JPY4.4bn, a recurring loss of JPY3.0bn, and net income of JPY40.6bn.
• JAFCO Group Co., Ltd. has announced a partnership with Nomura Asset Management Co., Ltd. to create a new publicly offered investment trust incorporating unlisted shares.

• T&D Holdings (8795 JP) , formed in 2004, is Japan’s first life insurance holding company.
• In FY03/23, ordinary revenues were JPY3.2tn, ordinary loss was JPY74.1bn, and loss attributable to owners of the parent was JPY132.2bn.
• T&D Holdings, Inc. has announced a change in its president.

• Monex Group Inc (8698 JP) started as online brokerage Monex, Inc. in April 1999 with CEO Oki Matsumoto and Sony Corporation as core investors.
• For FY03/23, the company reported full-year consolidated operating revenue of JPY79.3bn, net operating revenue of JPY73.3bn, operating profit equivalent of JPY4.8bn, pre-tax profit of JPY4.7bn.
• Monex Group, Inc. has announced that it will record a gain on fair value remeasurements under the equity method of accounting.

• Many are asking why KDDI would want to buy 50% of Lawson, Japan’s third biggest convenience store chain.
• Some more imaginative analysts suggest this could be just the first step towards KDDI merging with Rakuten in order to beat Amazon.
• The more likely future is an ecosystem to challenge Rakuten and LY Corp (Yahoo etc), starting with points and payments and evolving to other Fintech, e-commerce and health.

• Kumiai Chemical Industry Co (4996 JP) is an R&D-focused agrochemical manufacturing and marketing company with herbicides occupying a large portion of sales.
• Overall sales decreased as sales in the mainstay Agricultural Chemicals and Agriculture-Related Businesses fell YoY. Overseas sales accounted for 61.4％ of total sales.
• Operating profit decreased 49.3% YoY. Recurring profit fell 11.6% YoY, due mainly to a drop in earnings of affiliates under non-operating income, despite narrower foreign exchange losses.