In today’s briefing:
- TOPIX Index Upweights: The Big April Basket 2022 (Pre-Event)
- Chuo Gyorui to Take Out Hohsui – Done Deal Easy Peasy.
- Morinaga (2201) Mostly Exits Morinaga Milk (2264) – Big Buyback
- SBI Sumishin Net Bank Pre-IPO – Peer Comparison – One of the Largest but Also One of the Slowest
TOPIX Index Upweights: The Big April Basket 2022 (Pre-Event)
- The Tokyo Stock Exchange (TSE) calculates Free-Float Weight (FFW) for each listed company and uses this value as a key component of TOPIX Index Calculation.
- For companies with “low liquidity” the FFW will be multiplied by a fixed liquidity factor of 0.75 to derive the final FFW used for index calculation.
- Every April, the application of this liquidity factor is reviewed by the TSE for all TSE1 constituents. This situation opens up interesting opportunities for a basket trade.
Chuo Gyorui to Take Out Hohsui – Done Deal Easy Peasy.
- This is an agreement between one fish merchant Chuo Gyorui (8030 JP) and another fish merchant Nissui (1332 JP) to take over a third fish merchant, Hohsui Corp (1352 JP).
- And the takeover PER and forecast PCFR are low. But there really is nothing fishy here. Hohsui has a lot of debt.
- This is a done deal and there is nothing anyone can do about it.
Morinaga (2201) Mostly Exits Morinaga Milk (2264) – Big Buyback
- Morinaga & Co is selling down a near-10% stake in Morinaga Milk in a ToSTNeT-3 buyback on 1 March.
- Morinaga Milk will see an EPS and ROE uplift. Eventually, there are a lot more cross-holdings to buy back.
- Near-, medium-, and longer-term there are different flow patterns worth understanding if you have a position or are looking for one. If you want to sell lots, you can tomorrow.
SBI Sumishin Net Bank Pre-IPO – Peer Comparison – One of the Largest but Also One of the Slowest
- SBI Sumishin Net Bank (SSNB) will be looking to raise around US$1.1bn in its upcoming IPO.
- SSNB is a Japanese digital bank set up as a 50-50 joint venture between Sumitomo Mitsui Trust Bank, Japan’s largest trust bank, and SBI Group, a financial services firm.
- The deal, if successful, would be Japan’s first online-only bank to go public. In this note, we compare the company with some of its peers.
Before it’s here, it’s on Smartkarma
