Japanese Turnaround Situations, Short-Ideas, Azabu Research

Michael Allen

Japanese Turnaround Situations, Short-Ideas

Azabu Research

Azabu Research is a publishing and consulting firm focused on distressed equities in the Japanese market. We specialize in turnaround strategies, corporate combinations, divestitures, and restructuring.

Publisher of the Tokyo Turnaround Letter, which conducts the most thorough research possible of publicly available information, including forensic tests for fraudulent overstatement of assets and understatement of liabilities, as well as rigorous market and industry analysis to assess the underlying strengths of the company’s products or services, the appropriateness of the company’s turnaround strategy, and the skill of its current management team. The average length of a report exceeds 25 pages of text and tables, excluding any disclosures or executive summaries.

We have more than 30 years of experience in applying this process to distressed equities in Japan. Additionally, subscribers have free access to detailed, yet easily navigated earnings models for the target company as well as the top five comparable companies, and unlimited access to the analyst for follow-up questions.

Azabu Research also conducts be-spoke research on a project basis, and provides consulting services to companies looking to restructure, divest, make acquisitions, go public, or improve investor sentiment toward their stock.

Independent Research and Consulting Firm

Equity Bottom-Up

ROHM COMPANY LIMITED manufactures custom linear integrated circuits and semiconductor devices for use primarily in consumer electronics.  The Company has plants and sales offices worldwide.  Rohm's subsidiaries include Wako Electric and Apollo Electronics.

<ul>
<li>More than 40 potential turnaround stocks will report Q3 results in the coming weeks. </li>
<li>The average spread between the lowest and highest street estimate for the stocks on our target list is a gaping 45%. This doesn't mean what most people think it means.</li>
<li>Rohm, Taiyo Yuden, Yamato, Hamamatsu, JFE, Tsuruha look nice, but we pass on Shiseido and Mazda.</li>
</ul>


More than 40 potential turnaround stocks will report Q3 results in the coming weeks. 
The average spread between the lowest and highest street estimate for the stocks on our target list is a gaping 45%. This doesn't mean what most people think it means.
Rohm, Taiyo Yuden, Yamato, Hamamatsu, JFE, Tsuruha look nice, but we pass on Shiseido and Mazda.


Unloved Japan Roundup: Don't Panic Ahead of Q3 Results Rush

Technology / Semiconductor / Internet Research

Nicolas Baratte

Taiwan Semiconductor (TSMC) / Equity Bottom-Up

Taiwan Semiconductor Manufacturing Company, Ltd. manufactures and markets integrated circuits. The Company provides the following services: wafer manufacturing, wafer probing, assembly and testing, mask production, and design services. TSMC's ICs are used in computer, communication, consumer electronics, automotive, and industrial equipment industries.

<ul>
<li>Smartphone 2024 small growth about +5% YoY. PC 2024 small unit growth +4%. Don’t expect much better in 2025 but the Silicon content will increase, both for processor and DRAM.</li>
<li>Lots of cuts in 2025 Semiconductor Capex. TSMC is up but Samsung, UMC, Intel down. Japan Semi Equipment association has revised down 2025 growth from 10% to 5%.</li>
<li>Cloud Capex booming. Microsoft announced US$80bn in FY25. Meta at US$60-65bn. TSMC to increase 5-3nm wafer price by 5-10%. The Ai segment of semiconductors is doing extremely well</li>
</ul>


Smartphone 2024 small growth about +5% YoY. PC 2024 small unit growth +4%. Don’t expect much better in 2025 but the Silicon content will increase, both for processor and DRAM.
Lots of cuts in 2025 Semiconductor Capex. TSMC is up but Samsung, UMC, Intel down. Japan Semi Equipment association has revised down 2025 growth from 10% to 5%.
Cloud Capex booming. Microsoft announced US$80bn in FY25. Meta at US$60-65bn. TSMC to increase 5-3nm wafer price by 5-10%. The Ai segment of semiconductors is doing extremely well


Tech News: Smartphone and PC Stabilize. Semicon Capex Cuts. Cloud Capex Up. TSMC Increasing Prices.

External broker reports(aggregated public sources), Topline Securities

Topline Securities

External broker reports(aggregated public sources)

Topline Securities is one of the fastest growing brokerage houses in Pakistan. It has strong equity brokerage, economic / equity research, mutual fund distribution, commodity trading and corporate finance & advisory functions. Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

Thematic (Sector/Industry)

<ul><li>Pakistan recorded highest every monthly IT exports of US$348mn, up by 15% YoY while also up by 12% MoM in Dec-2024. These monthly IT exports in Dec-2024 are higher than last 12-month average of US$299mn. This is the 15th consecutive month of YoY IT export growth, starting from October 2023.</li><li>This takes 1HFY25 IT exports to US$1.86bn, up by 28% YoY.</li><li>Export proceeds per day were recorded at US$16.6mn for Dec-24 vs. US$14.8mn in Nov-24.</li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

Pakistan recorded highest every monthly IT exports of US$348mn, up by 15% YoY while also up by 12% MoM in Dec-2024. These monthly IT exports in Dec-2024 are higher than last 12-month average of US$299mn. This is the 15th consecutive month of YoY IT export growth, starting from October 2023.This takes 1HFY25 IT exports to US$1.86bn, up by 28% YoY.Export proceeds per day were recorded at US$16.6mn for Dec-24 vs. US$14.8mn in Nov-24.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Pakistan Technology - Highest Ever Monthly Exports of US$348mn in Dec-24

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Quantitative Analysis

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of January 24th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We highlight flows for SMIC (981 HK), Tencent (700 HK), ICBC (1398 HK).</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of January 24th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for SMIC (981 HK), Tencent (700 HK), ICBC (1398 HK).


Hong Kong Connect Flows (Jan 24th): SMIC, Tencent, ICBC

<ul>
<li>We analyzed the latest HK SFC report for aggregate short position as of Jan 17th.</li>
<li>Top short increases and decreases were tabulated for one week and four week period. </li>
<li>We highlight short changes in Tencent, Meituan, Ntes, Jd, Zijin Mining, Mengniu Dairy.</li>
</ul>


We analyzed the latest HK SFC report for aggregate short position as of Jan 17th.
Top short increases and decreases were tabulated for one week and four week period. 
We highlight short changes in Tencent, Meituan, Ntes, Jd, Zijin Mining, Mengniu Dairy.


HK Short Interest Weekly: Tencent, Meituan, Ntes, Jd, Zijin Mining, Mengniu Dairy

Insights in the Information Technology Space

Information Technology
Insights in the Information Technology Space

Unloved Japan Roundup: Don't Panic Ahead of Q3 Results Rush

Over 40 potential turnaround stocks set to report Q3 results with a 45% spread in estimates, some companies like Rohm and JFE look promising while...

Michael Allen

Tech News: Smartphone and PC Stabilize. Semicon Capex Cuts. Cloud Capex Up. TSMC Increasing Prices.

Smartphone and PC small growth in 2024 and 2025, but Silicon content in processors and DRAM will increase. Semiconductor Capex cuts in 2025. Cloud...

Nicolas Baratte

Pakistan Technology - Highest Ever Monthly Exports of US$348mn in Dec-24

Pakistan recorded highest every monthly IT exports of US$348mn, up by 15% YoY while also up by 12% MoM in Dec-2024. These monthly IT exports in...

Topline Securities

Hong Kong Connect Flows (Jan 24th): SMIC, Tencent, ICBC

We analyzed the Hong Kong Connect Scheme for last week and highlighted flows for SMIC (981 HK), Tencent (700 HK), ICBC (1398 HK).

Ke Yan, CFA, FRM

HK Short Interest Weekly: Tencent, Meituan, Ntes, Jd, Zijin Mining, Mengniu Dairy

We analyzed the latest HK SFC report for aggregate short position as of Jan 17th and highlight short interest changes in Tencent, Meituan, Ntes,...

Ke Yan, CFA, FRM

Unloved Japan Roundup: Don't Panic Ahead of Q3 Results Rush

​Over 40 potential turnaround stocks set to report Q3 results with a 45% spread in estimates, some companies like Rohm and JFE look promising while...

Michael Allen

Tech News: Smartphone and PC Stabilize. Semicon Capex Cuts. Cloud Capex Up. TSMC Increasing Prices.

​Smartphone and PC small growth in 2024 and 2025, but Silicon content in processors and DRAM will increase. Semiconductor Capex cuts in 2025. Cloud...

Nicolas Baratte

Pakistan Technology - Highest Ever Monthly Exports of US$348mn in Dec-24

Pakistan recorded highest every monthly IT exports of US$348mn, up by 15% YoY while also up by 12% MoM in Dec-2024. These monthly IT exports in...

Topline Securities

Hong Kong Connect Flows (Jan 24th): SMIC, Tencent, ICBC

We analyzed the Hong Kong Connect Scheme for last week and highlighted flows for SMIC (981 HK), Tencent (700 HK), ICBC (1398 HK).

Ke Yan, CFA, FRM

HK Short Interest Weekly: Tencent, Meituan, Ntes, Jd, Zijin Mining, Mengniu Dairy

We analyzed the latest HK SFC report for aggregate short position as of Jan 17th and highlight short interest changes in Tencent, Meituan, Ntes,...

Ke Yan, CFA, FRM

Over 40 potential turnaround stocks set to report Q3 results with a 45% spread in estimates, some companies like Rohm and JFE look promising while...

Smartphone and PC small growth in 2024 and 2025, but Silicon content in processors and DRAM will increase. Semiconductor Capex cuts in 2025. Cloud...