NTT (Buy) - Olympic Promotions Almost Over; Meanwhile We Have Updated Numbers

NTT (Buy) - Q1 21 Results Reaction: Buyback Confirmed

NTT Buybacks Continue - Bigger, Better, Faster, Stronger

NTT - Illegally Entertaining Your Regulator Is a Bad Look

Nippon Telegraph and Telephone: Q4 20 Results/FY21 Guidance – A Return to Sustainable Growth

Japan Telecom Sector: FY21 Will Be Tougher and More Competitive but Returns Can Still Rise

Telco/Internet specialist

Kirk Boodry

Redex Research

Equity Bottom-Up

NTT (Nippon Telegraph & Telephone) / Equity Bottom-Up

NTT (Nippon Telegraph & Telephone) (9432 JP)

<p>NTT has finished a self-review “Special Investigations Committee” after meetings with Ministry of Industry Affairs and Communications (MIC, the regulator) officials were found to have violated government ethics rules. The key takeaways: over five years, the company found 29 instances where costs were not shared equally and 8 times when dining meetings were held but costs were shared. There were no material breaches of ethics rules (no improper requests, no influence of the regulator’s judgement) but four senior members of management including CEO Sawada Jun were fined and twelve board and executive officers were reprimanded. On that basis, there are no material impacts to the company or its finances and while we believe it gives its competitors like KDDI and Softbank Corp. modestly more leverage with the regulator it is probably not material.  We remain at Buy.</p>

NTT has finished a self-review “Special Investigations Committee” after meetings with Ministry of Industry Affairs and Communications (MIC, the regulator) officials were found to have violated government ethics rules. The key takeaways: over five years, the company found 29 instances where costs were not shared equally and 8 times when dining meetings were held but costs were shared. There were no material breaches of ethics rules (no improper requests, no influence of the regulator’s judgement) but four senior members of management including CEO Sawada Jun were fined and twelve board and executive officers were reprimanded. On that basis, there are no material impacts to the company or its finances and while we believe it gives its competitors like KDDI and Softbank Corp. modestly more leverage with the regulator it is probably not material.  We remain at Buy.

NTT - Ethics Violation Review Ends with Management Fines and Promise to Do Better