Daily Brief Japan: Paramount Bed Holdings Co Lt, Stellantis NV, Tokyo Stock Exchange Tokyo Price Index Topix and more

In today’s briefing:

Paramount Bed Holdings (7817 JP): In-Line Q1 Result; FY24 Guidance Reaffirmed
Overweight Value Within Global Ex-U.S. Equities; DXY Below $105.70; Buys in Global Value
Public Opinion Is Slowly Catching Up, but the Change Has Only Just Begun

Paramount Bed Holdings (7817 JP): In-Line Q1 Result; FY24 Guidance Reaffirmed

In Q1FY24, Paramount Bed Holdings Co Lt (7817 JP) reported 7% YoY revenue growth to ¥24B, due to solid performance in the medical care and the nursing care businesses.
Due to higher SG&A expenses, operating profit grew just 2% YoY to ¥3.3B. Net profit rose 7% YoY to ¥2.9B, mainly due to 13% YoY increase in foreign exchange gains.
Paramount has reiterated FY24 guidance, which calls for 6% YoY revenue growth, 4% YoY operating profit growth, and 6% YoY growth in net profit.

Our overall outlook remains largely unchanged; we remain bullish on global equities as long as the MSCI ACWI (ACWI-US) is above major $93 support.
We also discussed that if the 10-year Treasury yield remains below 4.35% and the DXY is below $105.70, we would continue to expect $93 support on ACWI-US to hold.
The 10-year Treasury yield is attempting to break above 4.35% and this could create a problem for ACWI-US; we will continue to monitor closely.

Activist investors’ proposals were consistently based on increasing shareholder returns. The change in the environment, in which ％ of foreign shareholders increased while cross-held shares decreased, had a major impact.
Regarding the selection of directors, discussion on contents of Skill Matrix should be more active, as it’s suspected that top management is selecting candidates who are aligned with their wishes.
The voting standards of domestic institutional investors are iridescent and still dependent on public opinion for each proposal. The change in public opinion has only just begun.

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