Telco/Internet specialist

Kirk Boodry

Redex Research

Equity Bottom-Up

<p>By year-end we expect there will be two newly minted public fintech companies in Asia as IPOs for Kakao Pay (August) and PayTM (Q4-ish) move ahead. These are both potential comparables for Softbank Group’s PayPay of which Z Holdings is the leading shareholder. Comparatively, proposed valuations for Kakao Pay ($7-11bn) and PayTM ($24-25bn) are much higher but these are also later stage businesses with established track records and offer some insight into what PayPay can turn into over time. We currently value PayPay at its carry value of $500mn but as monetization starts, we expect management aspirations for a unicorn valuation can be reached. This report includes forecasts updated for Q4 results, guidance, and the acquisition of Yahoo trademark rights from Verizon.</p>

By year-end we expect there will be two newly minted public fintech companies in Asia as IPOs for Kakao Pay (August) and PayTM (Q4-ish) move ahead. These are both potential comparables for Softbank Group’s PayPay of which Z Holdings is the leading shareholder. Comparatively, proposed valuations for Kakao Pay ($7-11bn) and PayTM ($24-25bn) are much higher but these are also later stage businesses with established track records and offer some insight into what PayPay can turn into over time. We currently value PayPay at its carry value of $500mn but as monetization starts, we expect management aspirations for a unicorn valuation can be reached. This report includes forecasts updated for Q4 results, guidance, and the acquisition of Yahoo trademark rights from Verizon.

Z Holdings (Buy) - Asian Fintech App IPOs Highlight Potential PayPay Upside

Expert on Japan Retail and Consumer Markets, JapanConsuming

Michael Causton

Expert on Japan Retail and Consumer Markets

Real Insight on Japanese Consumer Markets

JapanConsuming

JapanConsuming is a specialist research firm producing intelligence on Japanese retail and consumer markets. Founded in 2000, JapanConsuming has become the leading provider of insights on Japanese retailers and consumer trends to retailers, brands, government agencies and investors. As well as a highly regarded monthly report on the market, JapanConsuming produces in-depth reports on retail sectors, seminars on key trends and telephone consulting to investors on trends and retailers.

JapanConsuming was founded by Michael Causton and Roy Larke. 

Event-Driven

<ul>
<li>Jade Group has acquired Magaseek and will merge the online mall with its own fashion e-commerce platform, Locondo and hopes to create a growing rival to Zozo.</li>
<li>Magaseek was founded by Itochu 20 years ago, and the deal underlines Itochu’s growing influence over Jade as a proxy for its ambitions in fashion e-commerce and distribution.</li>
<li>However, Jade Group has seen little organic growth for its Locondo platform in recent years, and while its acquisitions have added scale, integration has been haphazard.</li>
</ul>


Jade Group has acquired Magaseek and will merge the online mall with its own fashion e-commerce platform, Locondo and hopes to create a growing rival to Zozo.
Magaseek was founded by Itochu 20 years ago, and the deal underlines Itochu’s growing influence over Jade as a proxy for its ambitions in fashion e-commerce and distribution.
However, Jade Group has seen little organic growth for its Locondo platform in recent years, and while its acquisitions have added scale, integration has been haphazard.


Itochu Targets Fashion E-Commerce Via Jade Takeover of Magaseek

<ul>
<li>Many are asking why KDDI would want to buy 50% of Lawson, Japan's third biggest convenience store chain.</li>
<li>Some more imaginative analysts suggest this could be just the first step towards KDDI merging with Rakuten in order to beat Amazon.</li>
<li>The more likely future is an ecosystem to challenge Rakuten and LY Corp (Yahoo etc), starting with points and payments and evolving to other Fintech, e-commerce and health.</li>
</ul>


Many are asking why KDDI would want to buy 50% of Lawson, Japan's third biggest convenience store chain.
Some more imaginative analysts suggest this could be just the first step towards KDDI merging with Rakuten in order to beat Amazon.
The more likely future is an ecosystem to challenge Rakuten and LY Corp (Yahoo etc), starting with points and payments and evolving to other Fintech, e-commerce and health.


KDDI and Lawson: Building an Ecosystem from a Base of Loyalty Points

Thematic (Sector/Industry)

<ul>
<li>The big 3 convenience stores in Japan control 90% of the sector and share will climb as they mop up some of the remaining chains and collaborate with the rest.</li>
<li>Seven Eleven is by far the best performer of the three but both Lawson and Familymart are innovating to create quite different retail operations.</li>
<li>All are seeing the benefits of digitisation of store and supply chain operations, which should enhance profitability, enhanced by new services and revenue streams like retail media.</li>
</ul>


The big 3 convenience stores in Japan control 90% of the sector and share will climb as they mop up some of the remaining chains and collaborate with the rest.
Seven Eleven is by far the best performer of the three but both Lawson and Familymart are innovating to create quite different retail operations.
All are seeing the benefits of digitisation of store and supply chain operations, which should enhance profitability, enhanced by new services and revenue streams like retail media.


Conbini Wars: Seven Vs Lawson Vs Familymart

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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.

Equity Capital Markets

Rakuten Securities / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/rakuten-securities-inc" target="_blank" data-smartkarma-citation="entities:39933:1" rel="noopener">Rakuten Securities</a>, the online securities arm of Rakuten, aims to raise around US$500m (estimated) in its Japan listing.</li>
<li>It is the largest online securities firm in Japan with a 33.7% market share. In FY22, it had over 8.64m accounts, with around JPY18.2tn (US$131bn) of assets under custody.</li>
<li>In this note, we talk about the not-so-positive aspects of the deal.</li>
</ul>



Rakuten Securities, the online securities arm of Rakuten, aims to raise around US$500m (estimated) in its Japan listing.
It is the largest online securities firm in Japan with a 33.7% market share. In FY22, it had over 8.64m accounts, with around JPY18.2tn (US$131bn) of assets under custody.
In this note, we talk about the not-so-positive aspects of the deal.


Rakuten Securities IPO Early Look - The Negatives - Growth Has Slowed Down

Japan

NTT DOCOMO, INC. provides various types of telecommunication services including cellular phones, satellite mobile communication, and wireless LAN Network. The Company also sells cellular phones, and other equipment.

NTT Docomo Inc (9437 JP)

Z Holdings (Buy) - Asian Fintech App IPOs Highlight Potential PayPay Upside

Upcoming IPOs for two Asian fintech companies provide some insight on what Z Holdings PayPay can become once it starts to monetize its business....

Kirk Boodry

Itochu Targets Fashion E-Commerce Via Jade Takeover of Magaseek

Jade Group acquires Magaseek to merge with Locondo, aiming to rival Zozo; Itochu's influence grows using Jade as a proxy for fashion e-commerce...

Michael Causton

KDDI and Lawson: Building an Ecosystem from a Base of Loyalty Points

KDDI's acquisition of 50% of Lawson is probably a strategic move towards building an ecosystem to compete with Rakuten and LY, using loyalty...

Michael Causton

Conbini Wars: Seven Vs Lawson Vs Familymart

The top 3 convenience stores in Japan dominate the sector and are expected to further increase their market share. They are embracing digitization...

Michael Causton

Rakuten Securities IPO Early Look - The Negatives - Growth Has Slowed Down

Rakuten Securities, the online securities arm of Rakuten, aims to raise around US$500m (estimated) in its Japan listing. In this note, we talk...

Sumeet Singh

Z Holdings (Buy) - Asian Fintech App IPOs Highlight Potential PayPay Upside

Upcoming IPOs for two Asian fintech companies provide some insight on what Z Holdings PayPay can become once it starts to monetize its business....

Kirk Boodry

Itochu Targets Fashion E-Commerce Via Jade Takeover of Magaseek

​Jade Group acquires Magaseek to merge with Locondo, aiming to rival Zozo; Itochu's influence grows using Jade as a proxy for fashion e-commerce...

Michael Causton

KDDI and Lawson: Building an Ecosystem from a Base of Loyalty Points

​KDDI's acquisition of 50% of Lawson is probably a strategic move towards building an ecosystem to compete with Rakuten and LY, using loyalty...

Michael Causton

Conbini Wars: Seven Vs Lawson Vs Familymart

​The top 3 convenience stores in Japan dominate the sector and are expected to further increase their market share. They are embracing digitization...

Michael Causton

Rakuten Securities IPO Early Look - The Negatives - Growth Has Slowed Down

Rakuten Securities, the online securities arm of Rakuten, aims to raise around US$500m (estimated) in its Japan listing. In this note, we talk...

Sumeet Singh

Jade Group acquires Magaseek to merge with Locondo, aiming to rival Zozo; Itochu's influence grows using Jade as a proxy for fashion e-commerce...

KDDI's acquisition of 50% of Lawson is probably a strategic move towards building an ecosystem to compete with Rakuten and LY, using loyalty...

The top 3 convenience stores in Japan dominate the sector and are expected to further increase their market share. They are embracing digitization...