In today’s briefing:
- TOPIX FFW Transition – Big Flows from April to June
- Fanuc (6954) – Forget Yaskawa…a Slowdown Is Coming
- Japan’s Governance: About an Article on IR Disclosure
TOPIX FFW Transition – Big Flows from April to June
- On 7 April, the JPX announced the changes to the Free Float Weights (FFW) for the TOPIX Index. There are some big changes due to the updated FFW methodology.
- From April to June, we see a one-way turnover of 2.87% and a one-way trade of ¥2,285bn. Some stocks have opposite way flows in different months.
- Stocks with inflows outperformed stocks with outflows from Oct-Dec 2021 before giving up all the gains. These stocks have started to outperform and could continue outperforming over the next quarter.
Fanuc (6954) – Forget Yaskawa…a Slowdown Is Coming
- We are bearish on Fanuc. Yaskawa’s robotics orders were strong but Fanuc is more correlated with machine tool orders
- Machine Tool orders have already turned south and Fanuc is losing momentum in its order growth
- If we are right on the cycle, we expect Fanuc to trade down to 2.3x book value, 20% downside risk from here
Japan’s Governance: About an Article on IR Disclosure
- Trust banks enhance their services to support IR-disclosure for mid-sized companies. These services include surveying institutional investors and reporting their opinions to the company, as well as searching substantial shareholder.
- Medium-Sized companies have been reluctant to make IR disclosures and are eager to deepen their access to institutional investors.
- This is due to the fact that companies that have not been able to meet the prime market listing criteria are faced with the need to increase their market capitalization.
Before it’s here, it’s on Smartkarma
