In today’s briefing:
- Last Week in Event SPACE: Shin Kong Financial, Swire Pac, Seven & I, Korea Zinc
- Weekly Deals Digest (22 Sep) – Fuji Soft, Elan, Trancom, Seven & I, China TCM, Platinum, K Bank
- Tsuruha Holdings (3391 JP): Q1 FY02/25 flash update
- Focus on Cash Flow Recovery from Investments as Planned, as Well as Appropriate Cash Allocation
Last Week in Event SPACE: Shin Kong Financial, Swire Pac, Seven & I, Korea Zinc
- Stay long Shin Kong Financial Holding (2888 TT) and buy more, or get long. CTBC Financial Holding (2891 TT) may make a better run at it, and may even bump.
- It’s a hard to be bearish Swire Pacific (A) (19 HK) at 0.34x P/B. Yet the Hong Kong property market remains a challenging space. To put it mildly.
- Seven & I Holdings (3382 JP) saw breathless news articles suggesting a foreign takeover became more difficult. Not really.
Weekly Deals Digest (22 Sep) – Fuji Soft, Elan, Trancom, Seven & I, China TCM, Platinum, K Bank
- A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
- ECM developments: K Bank (279570 KS) has launched an IPO to raise up to US$734 million.
- Event-Driven developments: Fuji Soft Inc (9749 JP), Elan Corp (6099 JP), Trancom Co Ltd (9058 JP), Seven & I Holdings (3382 JP), China Traditional Chinese Medicine (570 HK).
Tsuruha Holdings (3391 JP): Q1 FY02/25 flash update
- Sales increased 5.2% YoY to JPY273.4bn, with operating profit growing 7.1% YoY to JPY15.1bn.
- The revised forecast for FY02/25 includes revenue of JPY850.8bn and net income of JPY22.2bn.
- FY02/25 will cover a 9.5-month period, with expected one-time expenses and unchanged annual dividend levels.
Focus on Cash Flow Recovery from Investments as Planned, as Well as Appropriate Cash Allocation
- Last year’s CAPEX plan was also a record high, but ROE growth was limited. We should closely monitor whether the allocation of CAPEX, shareholder returns, and retained earnings is appropriate.
- When a company finally begins using cash on hand for investments and lacks reliable track records, it should be monitored to ensure that it’s generating sufficient cash flow from CAPEX.
- The trend continues to remain that most investments are directed overseas. Note that many Japanese companies have a history of having difficulty managing their overseas operations.
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