Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

HK Type 4 license through Ballingal Investment Advisors Ltd. ("BIA" or "BIAL")

BACKGROUND
I have 20+yrs experience in Asia doing alternative strategies (i.e. non-delta1 non long-only) in fixed income, equity derivatives, and activist/catalyst/event-driven and long-short equity strategies with most of that time spent managing money. 

4 years in fixed income macro, 8 years running internal hedge fund and 4yrs investment banking at Citi in Japan, 3 years running an Asia multi-strat portfolio at a hedge fund, 4+yrs as an independent special situations analyst.

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

On Friday, October 19th, KITAKEI CO.,LTD <a href="http://file.swcms.net/file/kitakei/ja/news/auto_20181019419788/pdfFile.pdf" target="_blank">announced</a> (J-only) that the TSE had approved its application to move from the Second Section to the First Section of the TSE as of the 26th of October 2018. It will list on the TSE1 today.
Kitakei, is a Japanese supplier of housing materials, which was established in 1991. It has a market capitalisation of ¥9.6 billion. The company, while small, is well-known as an independent producer and seller of housing materials including interior and exterior housing material as well as equipment for kitchens, bathrooms, and restrooms, along with wood, metal, hardware materials, housing preservation chemicals, and construction materials. The company sees its itself as a comprehensive supplier of materials and goods to make homes livable and comfortable ("human-friendly housing" in their words), and they specialize in slightly up-market high-quality solid wood materials (flooring, panelling, banisters, columns, etc). The company has consistently grown sales over the past ten years (revenues rising every year but the year to November 2015) and gross margins have remained consistent at 10%, meaning OPMs are almost permanently low - in the 1-2% range.
The stock is up 11.7% in the last 12 months, to 25th October 2018, is up 150% in the last five years and has quintupled since post-GFC lows. Yesterday's close was a 23-year high price. Kitakei did not have to do a tachiaigai bunbai as is common with TSE2--&gt; TSE1 promotions because with their 3,781 shareholders (as of Nov 2017), they met the minimum requirement for TSE1 reclassification of 2,200 shareholders.
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This is a small company (¥9.6bn market cap now) TOPIX inclusion. Float is not huge as these things go, but the inclusion is likely worth about ¥0.5-0.6bn as of Wednesday's close.
This company is only discussed because of the TOPIX inclusion situation. I would avoid the stock. If you don't have it in the book and are uninterested in tiny caps, I would look away now.
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On Friday, October 19th, KITAKEI CO.,LTD announced (J-only) that the TSE had approved its application to move from the Second Section to the First Section of the TSE as of the 26th of October 2018. It will list on the TSE1 today.
Kitakei, is a Japanese supplier of housing materials, which was established in 1991. It has a market capitalisation of ¥9.6 billion. The company, while small, is well-known as an independent producer and seller of housing materials including interior and exterior housing material as well as equipment for kitchens, bathrooms, and restrooms, along with wood, metal, hardware materials, housing preservation chemicals, and construction materials. The company sees its itself as a comprehensive supplier of materials and goods to make homes livable and comfortable ("human-friendly housing" in their words), and they specialize in slightly up-market high-quality solid wood materials (flooring, panelling, banisters, columns, etc). The company has consistently grown sales over the past ten years (revenues rising every year but the year to November 2015) and gross margins have remained consistent at 10%, meaning OPMs are almost permanently low - in the 1-2% range.
The stock is up 11.7% in the last 12 months, to 25th October 2018, is up 150% in the last five years and has quintupled since post-GFC lows. Yesterday's close was a 23-year high price. Kitakei did not have to do a tachiaigai bunbai as is common with TSE2--&gt; TSE1 promotions because with their 3,781 shareholders (as of Nov 2017), they met the minimum requirement for TSE1 reclassification of 2,200 shareholders.

This is a small company (¥9.6bn market cap now) TOPIX inclusion. Float is not huge as these things go, but the inclusion is likely worth about ¥0.5-0.6bn as of Wednesday's close.
This company is only discussed because of the TOPIX inclusion situation. I would avoid the stock. If you don't have it in the book and are uninterested in tiny caps, I would look away now.


Kitakei Co Ltd

Kitakei (9872 JP) TOPIX Inclusion