Daily Brief TMT/Internet: Kokusai Electric , CELSYS, Micron Technology, Shift Up, Netdragon Websoft, Arlo Technologies Inc, Cirrus Logic, Accenture Plc Cl A, BILL Holdings and more

• Today, a Reuters article came out saying that KKR would sell down half its 43% stake in Kokusai Electric (6525 JP) according to “two people familiar with the matter.”
• The article also said Kokusai Electric would buy back shares. Kokusai responded with a TDNET release saying “we did not release this info but we are considering various capital policies.
• It pays to look at the Shareholder Structure as it stands. This is bigger than it looks. 

• Reuters reported that KKR & Co (KKR US), the largest Kokusai Electric (6525 JP) shareholder, plans to sell about half of its 43% stake, worth around JPY300 billion.
• As Kokusai’s shares are trading at 3.2x the IPO price of JPY1,840, KKR would be tempted to reduce its stake further. The 180-day IPO lock-up period expired on 22 April.
• Kokusai anticipates a return to growth and margin improvement. However, Kokusai trades at a material premium to peer multiples and is fully priced. 

• Quiddity’s “Who is Ready” series of insights aims to objectively identify names listed on the Tokyo Stock Exchange that are potential additions to the TOPIX Index in future.
• In the last few days, SUNWELS Co (9229 JP) and Macbee Planet (7095 JP) have announced their moves to TSE prime which would eventually trigger a TOPIX Inclusion event.
• Macbee Planet was in our highest conviction list but SUNWELS Co was not. In this insight, we have made some modifications to our methodology to improve future hit rates.

• Micron Technology recently provided insights into their fiscal third quarter 2024 performance, shedding light on various strategic and operational aspects that investors may find critical in shaping their investment thesis.
• Amid a challenging global semiconductor landscape characterized by rapid technological advancements and fluctuating demand cycles, Micron appears cautiously optimistic about the future, driven by strategic investments and a focus on high-margin products.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• Shift Up (462870 KS) raised around US$320m in its South Korean IPO, after pricing at the top.
• Shift Up is a South Korean games developer, which as released three games so far for the global markets.
• We have looked at the company’s performance and valuation in our earlier notes. In this note, we talk about the trading dynamics.

• NetDragon’s stock is priced at 11.0 HKD with 531 million shares and a market cap of 5,870 HKD
• Company completed a reverse merger listing for its education business, causing some complications, but gaming business is seen as a hidden gem with growth potential
• NetDragon, operated by the Liu family, has a history of successful business incubation and has returned around 50% of its market capitalization to shareholders in the past three years

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• ARLO announced it had reached 4 million paid accounts approximately four months after achieving 3 million paid accounts. 
• The pace of growth is most likely the result of catch-up calculations related to Verisure. However, this should not take away from the magnitude of increase in the number.
• The higher baseline of subscriber numbers should change the annualized recurring revenue (“ARR”) for ARLO compared to the end of the first quarter.  

• Cirrus Logic has presented its financial results for the fourth quarter and the entire fiscal year 2024, revealing mixed outcomes that highlight both challenges and growth opportunities.
• The company reported a fourth-quarter revenue of $378.1 million, surpassing the upper edge of the guidance range.
• This surge was attributed to an unexpected rise in demand for smartphone components.

• Accenture’s latest financial results highlight a dynamic and multifaceted performance.
• The fiscal year has seen client spending patterns diverge from initial expectations, with a clear preference for large-scale transformations over smaller, discretionary projects.
• This shift has led to slower revenue conversion and delayed decision making, necessitating a strategic pivot by Accenture.

• BILL reported strong fiscal third quarter 2027 results, highlighting robust revenue growth and significant expansion in non-GAAP operating income.
• Revenue increased by 19% year-over-year, driven by high transaction volumes and an effective monetization strategy.
• The reception of their financial management solutions among small businesses remains vigorous, as evidenced by the processing of over 25 million transactions amounting to more than $70 billion during the quarter.