Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

Japanese and Asian equity long/short strategies

Uzabase

Specialising in Japanese and Asian equity long/short strategies with a focus on rigorous, but targeted quantitative analysis to temper evaluations of company strategy, potential and vision. At Uzabase, our team of analysts provides coverage of industry dynamics with a local Asian flavour on Speeda, our financial information platform. Going forward we are aiming to channel our focus toward thematic research on emerging industries and company research.

Equity Bottom-Up

<p>Mounting losses in its Shipbuilding and Engineering segments have seen <a href="https://www.smartkarma.com/entities/2402" target="_blank" data-smartkarma-citation="entities:2402:1">Mitsui Engineer &amp; Shipbuild (7003 JP)</a> 's Discount to NAV on Smartkarma's HoldCo Monitor hit 44%, as it did on 12 Feb 2016 before rallying 40% in about 1 month. The metric has again broken the 2SD band and a 40% rally would only take the company to 15x PE on consensus FY2018 estimates - a similar level to peers such as KHI and IHI. Stellar results at subsidiary, <a href="https://www.smartkarma.com/entities/2840" target="_blank" data-smartkarma-citation="entities:2840:1">Modec Inc (6269 JP)</a> and an end to bleeding in the shipbuilding segment, as the delivery of 4 loss-making tugs is completed, should encourage investors. A confirmation that losses on a subsidiary's EPC project will not exceed the JPY10.7bn already provisioned for it could lift the overhang on the stock, while a recent change in segmentation for ships will improve transparency on the non-MODEC part of that business.</p>

Mounting losses in its Shipbuilding and Engineering segments have seen Mitsui Engineer &amp; Shipbuild (7003 JP) 's Discount to NAV on Smartkarma's HoldCo Monitor hit 44%, as it did on 12 Feb 2016 before rallying 40% in about 1 month. The metric has again broken the 2SD band and a 40% rally would only take the company to 15x PE on consensus FY2018 estimates - a similar level to peers such as KHI and IHI. Stellar results at subsidiary, Modec Inc (6269 JP) and an end to bleeding in the shipbuilding segment, as the delivery of 4 loss-making tugs is completed, should encourage investors. A confirmation that losses on a subsidiary's EPC project will not exceed the JPY10.7bn already provisioned for it could lift the overhang on the stock, while a recent change in segmentation for ships will improve transparency on the non-MODEC part of that business.

Mitsui Engineering Discount to NAV Hits 44% Again. Is a Repeat of Feb 2016's 40% Rally on the Cards?

Japan

Mitsui E&S Holdings Co., Ltd. engineers, builds, and repairs ships.  The Company also manufactures industrial machinery and equipment and builds power plants.  Mitsui Engineering & Shipbuilding also operates information systems services and real estate business.

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Mitsui E&S Holdings (7003 JP)

Mitsui Engineering Discount to NAV Hits 44% Again. Is a Repeat of Feb 2016's 40% Rally on the Cards?

Mounting losses in its Shipbuilding and Engineering segments have seen Mitsui Engineer & Shipbuild (7003 JP) 's Discount to NAV on Smartkarma's...

Mio Kato

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