Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>Yields continue to rise as investors flee US assets and Trump's bill adds to fiscal imbalance.</li>
<li>Weakness for yesterdays big tech/AI outperformers to be reflected in Japan, although new lows unlikely.</li>
<li>Suzuki should see lower levels into its secondary pricing next week amid tepid longer-term investor backdrop.</li>
</ul>


Yields continue to rise as investors flee US assets and Trump's bill adds to fiscal imbalance.
Weakness for yesterdays big tech/AI outperformers to be reflected in Japan, although new lows unlikely.
Suzuki should see lower levels into its secondary pricing next week amid tepid longer-term investor backdrop.


Japan Morning Connection: Markets Tumble on China/US Standoff and Outlook for Capital Spending

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.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tokio-marine-holdings-inc" target="_blank" data-smartkarma-citation="entities:7591:1" rel="noopener">Tokio Marine Holdings (8766 JP)</a> and <a href="https://www.smartkarma.com/entities/sompo-holdings-inc" target="_blank" data-smartkarma-citation="entities:632:1" rel="noopener">Sompo Holdings (8630 JP)</a> aim to raise around US1.15bn (including over-allotment) via selling around 5% of <a href="https://www.smartkarma.com/entities/suzuki-motor-corp" target="_blank" data-smartkarma-citation="entities:732:1" rel="noopener">Suzuki Motor (7269 JP)</a>.</li>
<li>While Suzuki doesn’t have much direct exposure to the US markets, its shares had corrected in line with other auto players going into the deal launch.</li>
<li>In this note, we compare the deal to some of the past deals and talk about the updates since our last note.</li>
</ul>



Tokio Marine Holdings (8766 JP) and Sompo Holdings (8630 JP) aim to raise around US1.15bn (including over-allotment) via selling around 5% of Suzuki Motor (7269 JP).
While Suzuki doesn’t have much direct exposure to the US markets, its shares had corrected in line with other auto players going into the deal launch.
In this note, we compare the deal to some of the past deals and talk about the updates since our last note.


Suzuki Motor Placement Updates - Relative Correction Has Been Decent so Far. But Lacks Buyback

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

<ul>
<li>Tokio Marine &amp; Nichido Fire Insurance and Sompo Japan Insurance are looking to offload their entire stakes in <a href="https://www.smartkarma.com/entities/suzuki-motor-corp" target="_blank" data-smartkarma-citation="entities:732:1" rel="noopener">Suzuki Motor (7269 JP)</a> by way of a secondary offering.</li>
<li>With the size of the secondary offering less than 5% of the number of shares, there could be no index buying in the short-term and that will pressure the stock.</li>
<li>If the overallotment option is exercised and the seller of the shares is currently considered as non-float, there could be small passive buying in the short-term.</li>
</ul>


Tokio Marine &amp; Nichido Fire Insurance and Sompo Japan Insurance are looking to offload their entire stakes in Suzuki Motor (7269 JP) by way of a secondary offering.
With the size of the secondary offering less than 5% of the number of shares, there could be no index buying in the short-term and that will pressure the stock.
If the overallotment option is exercised and the seller of the shares is currently considered as non-float, there could be small passive buying in the short-term.


Suzuki Motor (7269 JP) Placement: Limited Index Buying & Weak Markets Could Pressure Stock

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tokio-marine-holdings-inc" target="_blank" data-smartkarma-citation="entities:7591:1" rel="noopener">Tokio Marine Holdings (8766 JP)</a> and <a href="https://www.smartkarma.com/entities/sompo-holdings-inc" target="_blank" data-smartkarma-citation="entities:632:1" rel="noopener">Sompo Holdings (8630 JP)</a> aim to raise around US1.15bn (including over-allotment) via selling around 5% of <a href="https://www.smartkarma.com/entities/suzuki-motor-corp" target="_blank" data-smartkarma-citation="entities:732:1" rel="noopener">Suzuki Motor (7269 JP)</a>.</li>
<li>While Suzuki doesn’t have much direct exposure to the US markets, its shares have still corrected in line with other auto players.</li>
<li>In this note, we will talk about the deal dynamics and run the deal through our ECM framework.</li>
</ul>



Tokio Marine Holdings (8766 JP) and Sompo Holdings (8630 JP) aim to raise around US1.15bn (including over-allotment) via selling around 5% of Suzuki Motor (7269 JP).
While Suzuki doesn’t have much direct exposure to the US markets, its shares have still corrected in line with other auto players.
In this note, we will talk about the deal dynamics and run the deal through our ECM framework.


Suzuki Motor Placement - Not the Best Time for a US$1.15bn Deal. It Will Be a Long Week.

Asia L/S Equity PM/Macro/Thematic Idea Generation

Rikki Malik

Cross Asset Strategy

<ul>
<li>Act 1 of the US bear market is likely complete, with diverging price signals from stocks, bonds and the dollar.</li>
<li>This will be a rebound bounce to sell into, as we are not going back to previous highs.</li>
<li>Looking at companies servicing high-income consumers is a good hunting ground for shorts.</li>
</ul>


Act 1 of the US bear market is likely complete, with diverging price signals from stocks, bonds and the dollar.
This will be a rebound bounce to sell into, as we are not going back to previous highs.
Looking at companies servicing high-income consumers is a good hunting ground for shorts.


Investors Have that “Oh Sh#t Moment” - Part 2:  Trading Opportunities.

Japan

Mitsubishi UFJ Financial Group, Inc. (MUFG) is a holding company established through the merger of Mitsubishi Tokyo Financial Group and UFJ Holdings. As a financial group, the Company provides a variety of financial and investment services including commercial banking, trust banking, international finance, and assets management services.

Mitsubishi UFJ Financial (MUFG) (8306 JP)

Price Gauge
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Mitsubishi UFJ Financial (MUFG) (8306 JP)

Japan Morning Connection: Markets Tumble on China/US Standoff and Outlook for Capital Spending

Investors fleeing US assets and Trump's bill adding to fiscal imbalance causing yields to rise further. New lows unlikely for big tech/AI, today's...

Andrew Jackson

Suzuki Motor Placement Updates - Relative Correction Has Been Decent so Far. But Lacks Buyback

Tokio Marine Holdings (8766 JP) and Sompo Holdings (8630 JP) aim to raise around US1.15bn via selling 5% of Suzuki Motor (7269 JP). We compare it...

Sumeet Singh

Suzuki Motor (7269 JP) Placement: Limited Index Buying & Weak Markets Could Pressure Stock

Two large holders are looking to sell their entire stakes in Suzuki Motor. That is US$1.17bn including overallotment and 4.87% of shares out. That...

Brian Freitas

Suzuki Motor Placement - Not the Best Time for a US$1.15bn Deal. It Will Be a Long Week.

Tokio Marine Holdings (8766 JP) and Sompo Holdings (8630 JP) aim to raise around US1.15bn (including over-allotment) via selling around 5% of...

Sumeet Singh

Investors Have that “Oh Sh#t Moment” - Part 2: Trading Opportunities.

US bear market Act 1 likely over, rebound is a selling opportunity as previous highs won't be reached. High-income consumer companies are good...

Rikki Malik

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Japan Morning Connection: Markets Tumble on China/US Standoff and Outlook for Capital Spending

​Investors fleeing US assets and Trump's bill adding to fiscal imbalance causing yields to rise further. New lows unlikely for big tech/AI, today's...

Andrew Jackson

Suzuki Motor Placement Updates - Relative Correction Has Been Decent so Far. But Lacks Buyback

Tokio Marine Holdings (8766 JP) and Sompo Holdings (8630 JP) aim to raise around US1.15bn via selling 5% of Suzuki Motor (7269 JP). We compare it...

Sumeet Singh

Suzuki Motor (7269 JP) Placement: Limited Index Buying & Weak Markets Could Pressure Stock

Two large holders are looking to sell their entire stakes in Suzuki Motor. That is US$1.17bn including overallotment and 4.87% of shares out. That...

Brian Freitas

Suzuki Motor Placement - Not the Best Time for a US$1.15bn Deal. It Will Be a Long Week.

Tokio Marine Holdings (8766 JP) and Sompo Holdings (8630 JP) aim to raise around US1.15bn (including over-allotment) via selling around 5% of...

Sumeet Singh

Investors Have that “Oh Sh#t Moment” - Part 2: Trading Opportunities.

​US bear market Act 1 likely over, rebound is a selling opportunity as previous highs won't be reached. High-income consumer companies are good...

Rikki Malik

Investors fleeing US assets and Trump's bill adding to fiscal imbalance causing yields to rise further. New lows unlikely for big tech/AI, today's...

US bear market Act 1 likely over, rebound is a selling opportunity as previous highs won't be reached. High-income consumer companies are good...