In today’s briefing:
- Shinsei’s TOB Period Almost Done – What Next?
- Nikon: A Reality Check on Nikon’s Medium-Term Management Plan
- Nikon (7731) | Profitability Key to Mid-Term Plan
- Ricoh (7752 JP) – Long Term Structural Decliner with a Recent Boost in Inorganic Rev & Profits
Shinsei’s TOB Period Almost Done – What Next?
- The Tender Offer by SBI Holdings (8473 JP) to take private SBI Shinsei Bank (8303 JP) is almost done. The tender closes on 23 June.
- The stock has not traded below theTOB Price since the announcement. People have built positions. Expect minimal liquidity from here on out. I expect a somewhat ‘weak’ result.
- Now starts a series of ‘technical’ events and deadlines which will culminate for some in delisting at end-Q3/start-Q4 and for some ends in years after an Appraisal Rights case.
Nikon: A Reality Check on Nikon’s Medium-Term Management Plan
- During 4QFY03/2023 results release, Nikon announced a medium-term target of revenues of ¥700bn, OPM of 10%+ and ROE of 8%+ by the end of FY2025E (FY ended 31st March 2026).
- Our analysis (with conservative assumptions) suggests that the company could easily achieve its medium-term target despite the company expecting to see its earnings declining in FY03/2024E.
- Nikon is trading at a discount to its Japanese peers Canon and Konica Minolta and we think the market is clearly undervaluing the company as a pure-play Imaging products player.
Nikon (7731) | Profitability Key to Mid-Term Plan
- Poised for Profitability rebound in FY3/25 putting Nikon on track to meet mid-term plan targets.
- ArF Unit Expansion as Intel benefits from government fiscal incentives to build fabs in EU and US.
- Based on the FY3/26 plan for EBIT of Y70b, the stock’s theoretical valuation would reach around Y2,200/share
Ricoh (7752 JP) – Long Term Structural Decliner with a Recent Boost in Inorganic Rev & Profits
- Large portion of the business is in secular decline and facing pricing pressure
- Ricoh Company Ltd (7752 JP) appears to be losing share in a shrinking market
- Estimates are above overly optimistic guidance making shares look optically inexpensive
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