In today’s briefing:
- Sep22 FTSE EPRA Nareit Index Rebalance – Big Impact on Sekisui House (1928 JP)
- Kadokawa – Investments From Sony and Tencent
- Raccoon: Maintaining COVID Momentum
Sep22 FTSE EPRA Nareit Index Rebalance – Big Impact on Sekisui House (1928 JP)
- Yesterday FTSE Russell announced two Asian additions to its FTSE EPRA Nareit Global Developed Index – Sekisui House (1928 JP) and Healthcare & Medical Investment Corporation (3455 JP).
- Sekisui House is larger cap, and will see big dollars added. H&M IC is much smaller and will see less, but has had a huge run-up, outright and relative.
- Trading impact will be significant on both tickers in terms of days of ADV.
Kadokawa – Investments From Sony and Tencent
- Kadokawa announced yesterday that subsidiary From Software would conduct a third-party allocation of shares to Sony and Tencent.
- The allotment values From Software at about ¥120bn with Tencent acquiring 16.25% and Sony acquiring 14.09% of the company.
- This creates opportunities for both Sony and Tencent and likely puts Kadokawa on track to eventually be acquired though timing may be somewhat later than we had anticipated.
Raccoon: Maintaining COVID Momentum
- While its peers in Japanese e-commerce are losing momentum, Tokyo-listed B2B e-commerce company, Raccoon Holdings, Inc. (3031 JP) continues to march forward from the COVID elevated levels.
- With the advertising cost no longer growing at the same rate as before, we expect around 60% upside to Raccoon’s FY+2 consensus OP of ¥1.6bn.
- This would put Raccoon on 9.5x FY+2 OP with an OP CAGR of close to 50% and seems reasonably cheap in our opinion.
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