In today’s briefing:
- TOPIX Inclusion Pre-Event: Appier Group (4180 JP)
- Kirin: Off of Myanmar & Off to a Good Start
- Safie – Baby Thrown Out With the Bathwater Number Two
- USDJPY at Risk
- W Scope (6619): Improved and Price Is Moving
- MonotaRO (3064): Earnings Forecast Update. Focus on Evolution of Logistics Infrastructure
TOPIX Inclusion Pre-Event: Appier Group (4180 JP)
- Japan-Based AI company Appier Group Inc (4180 JP) announced they had resolved to prepare to apply to change its listing on the Tokyo Stock Exchange to the Prime Market.
- Appier has confirmed that it meets the criteria for the TSE Growth Market but if they move to the Prime Market, that would trigger a TOPIX Inclusion Event.
- Below is a look at Appier’s potential to satisfy the Section Transfer Requirements and the upside potential of this event.
Kirin: Off of Myanmar & Off to a Good Start
- Earlier this week, Kirin Holdings (2503 JP)’s board decided to withdraw from all the businesses in Myanmar urgently.
- With the Myanmar JV issue out of the way and asset write-offs mostly complete, we think Kirin’s normalised EPS will grow at a CAGR of 11% through 2021-24.
- This puts Kirin on 9.4x 2024 EPS, limiting the down side risk to the bare minimum.
Safie – Baby Thrown Out With the Bathwater Number Two
- Safie reported 2021 results on Monday and beat slightly with revenue 1.6% above guidance and an operating loss of ¥76m, better than guidance of a ¥225m loss.
- The stock is rated neutral by the sell side despite offering perhaps the best growth prospects in Japan and demonstrating numerous signs of exceptional management.
- We consider the name to be potentially Japan’s best growth story in the small cap space.
USDJPY at Risk
- If earlier charts are correct in suggesting lower US long end yields in the short term then USDJPY is vulnerable
- So far it has failed twice at 116.35 thereby creating the possibility of a double top
- Support is seen at 113.47 followed by a range of levels between 112.14 and 112.53
W Scope (6619): Improved and Price Is Moving
- W Scope Corp (6619 JP) share price has severely underperformed Tokyo Stock Exchange Tokyo Price Index Topix (TPX INDEX)in the last 5 years.
- Its business has picked up followed by the ability to pare debt down and potentially lower shipping costs that will expand margin.
- It trades at 1.8x PBR, cheaper than Samsung SDI and LG Energy solution although more expensive than Showa Denko but W Scope’s operational number has been phenomenal.
MonotaRO (3064): Earnings Forecast Update. Focus on Evolution of Logistics Infrastructure
New target price 2,150 yen; Reiterate our Hold rating
On February 3, the company announced FY12/21 consolidated OP of 24.1bn yen (+23.1% YoY, OPM 12.7%), slightly below the company’s guidance of 24.7bn yen
Mita Securities’ earnings forecast: Lowering our OPM assumptions
Before it’s here, it’s on Smartkarma
