In today’s briefing:
- 2021 High Conviction Seven & I: Major Headwinds Deflected By The Yen Depreciation, Upside Is Limited
- Ibiden (4062 JP): Another Chance for Long-Term Investors
- Softbank Group – Vision Fund: Gains on Dollar Basis in Q3 but Stronger Yen Points to Quarterly Loss
- Peptidream (4587 JP): Rising Drug Discovery Collaborations To Drive Growth; New Revenue Stream Added
2021 High Conviction Seven & I: Major Headwinds Deflected By The Yen Depreciation, Upside Is Limited
- We would be closing our 2021 high-conviction long trade on Seven & I Holdings (3382 JP) before they release 3QFY23 results next week.
- Although we are not expecting the company to miss consensus estimates this time around, we are expecting significant downside risks to Seven & I’s US business throughout the year.
- Given that shares went nowhere after 12% revenue and 1% OP beats in the previous quarter is a good indication that the upside is limited.
Ibiden (4062 JP): Another Chance for Long-Term Investors
- Operating profit hit a 15-year high in the six months to September. That appears to have been the cyclical peak.
- Guidance for 2H of FY Mar-23 is probably conservative, but year-on-year profit comparisons will probably be negative for at least a year.
- After rising by 44% from mid-October to mid-November, Ibiden’s share price has given up more than half that gain. Long term investors may again look for an entry point.
Softbank Group – Vision Fund: Gains on Dollar Basis in Q3 but Stronger Yen Points to Quarterly Loss
- The Vision Fund public portfolio closed Q3 in the black as gains for Didi and AutoStore offset weakness for Asian investments Goto and Coupang. We have included updated tables inside
- On a yen basis, however, Softbank will likely post a Q3 segment loss for Vision Fund as a weaker dollar more than offsets the local currency gains.
- SBG shares have traded close to the 35% discount to NAV level since end-November but that could expand if sentiment on China weakens or tech valuations remain volatile
Peptidream (4587 JP): Rising Drug Discovery Collaborations To Drive Growth; New Revenue Stream Added
- Peptidream Inc (4587 JP) aspires to be a world leader in drug discovery and development to address unmet medical needs by leveraging on proprietary PDPS technology, a peptide discovery platform.
- Driven by expanding research collaboration programs and progressing pipelines, Peptidream guided for revenue of ¥13–15B from drug discovery and development business in 2022, up from ¥9.4B in 2021.
- Foray into Radiopharma adds a regular revenue stream. Peptidream expects the business to report revenue of ~¥11.5B and remain marginally profitable for 2022.
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