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. 

Thematic (Sector/Industry)

<ul>
<li>Analysts are expecting cashless payments in Japan for 2021 to show further accelerated growth in the use of mobile payment apps.</li>
<li>Surveys suggest consumers rapidly increased their use of mobile payments and are even expressing frustration when the service is unavailable. </li>
<li>PayPay is utterly dominant with nearly 50% share based on survey responses. We expect consolidation below from NTT, Mercari, Rakuten and KDDI.</li>
</ul>


Analysts are expecting cashless payments in Japan for 2021 to show further accelerated growth in the use of mobile payment apps.
Surveys suggest consumers rapidly increased their use of mobile payments and are even expressing frustration when the service is unavailable. 
PayPay is utterly dominant with nearly 50% share based on survey responses. We expect consolidation below from NTT, Mercari, Rakuten and KDDI.


Growth in Cashless Payments Surges in Japan – PayPay Totally Dominant

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.nikkei.com/article/DGXZQOUB1619K0W6A710C2000000/" target="_blank" rel="noopener">Nikkei</a> reported that EQT/<a href="https://www.smartkarma.com/entities/digital-garage-inc" target="_blank" data-smartkarma-citation="entities:13747:1" rel="noopener">Digital Garage (4819 JP)</a> has increased its offer for <a href="https://www.smartkarma.com/entities/kakaku-com-inc" target="_blank" data-smartkarma-citation="entities:7408:1" rel="noopener">Kakaku.com Inc (2371 JP)</a> to the mid-JPY3,400, while Bloomberg reported that EQT/DG is now offering JPY3,440-3,460 per share.</li>
<li>The latest EQT/DG offer is designed to game the competing-offer clauses to retain the Board's and KDDI’s support and potentially secure Oasis's allegiance.</li>
<li>The bidding battle is not done yet. By increasing its offer by 1% from JPY3,384 to JPY3,419 (from JPY3,500 to JPY3,535 on an equivalent basis), Bain/LY can regain the advantage.</li>
</ul>



Nikkei reported that EQT/Digital Garage (4819 JP) has increased its offer for Kakaku.com Inc (2371 JP) to the mid-JPY3,400, while Bloomberg reported that EQT/DG is now offering JPY3,440-3,460 per share.
The latest EQT/DG offer is designed to game the competing-offer clauses to retain the Board's and KDDI’s support and potentially secure Oasis's allegiance.
The bidding battle is not done yet. By increasing its offer by 1% from JPY3,384 to JPY3,419 (from JPY3,500 to JPY3,535 on an equivalent basis), Bain/LY can regain the advantage.


Convenience store (CVS) retailing remains the most dynamic and innovative physical store sector. It is now 50 years since the first Seven Eleven opened and the sector wide drop in sales in 2020 was the first in its history.Whereas department stores also took a battering last year and are likely to struggle to recover, convenience stores should bounce back quickly, including implementing lessons learned in last year’s crisis.That does not mean the format faces no problems, with labour shortages, overly strict operating procedures and an ageing population of store owners (many are now reaching retirement age with no succession in place) all issues that need solutions, but its willingness and ability to adopt new technologies and adapt to the market will continue to keep CVS strong.The following is an annual in-depth review of the entire CVS sector providing context for investors in any of the big CVS retailers (and their competing formats) as well as reviews of each major firm's KPIs.

Convenience store (CVS) retailing remains the most dynamic and innovative physical store sector. It is now 50 years since the first Seven Eleven opened and the sector wide drop in sales in 2020 was the first in its history.Whereas department stores also took a battering last year and are likely to struggle to recover, convenience stores should bounce back quickly, including implementing lessons learned in last year’s crisis.That does not mean the format faces no problems, with labour shortages, overly strict operating procedures and an ageing population of store owners (many are now reaching retirement age with no succession in place) all issues that need solutions, but its willingness and ability to adopt new technologies and adapt to the market will continue to keep CVS strong.The following is an annual in-depth review of the entire CVS sector providing context for investors in any of the big CVS retailers (and their competing formats) as well as reviews of each major firm's KPIs.

Convenience Stores: First Decline in 50 Years

Telco/Internet specialist

Kirk Boodry

Redex Research

The Nikkei reports the Ministry of Industry Affairs and Communications (MIC, the regulator) will not allow NTT’s local exchange companies to give a wholly owned DoCoMo preferential treatment. This is not surprising and whilst it may modestly impact sentiment in the near-term, the real issue is competition in selling integrated fixed-wireless services to corporate users and that will develop no matter how NTT is regulated.  Meanwhile, a shift in political and regulatory focus away from mobile pricing is good news for everyone and we remain overweight with NTT as our top pick.

The Nikkei reports the Ministry of Industry Affairs and Communications (MIC, the regulator) will not allow NTT’s local exchange companies to give a wholly owned DoCoMo preferential treatment. This is not surprising and whilst it may modestly impact sentiment in the near-term, the real issue is competition in selling integrated fixed-wireless services to corporate users and that will develop no matter how NTT is regulated.  Meanwhile, a shift in political and regulatory focus away from mobile pricing is good news for everyone and we remain overweight with NTT as our top pick.

Japan Telecom Sector - Regulator to Signal Level Playing Field for DoCoMo

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Cross Asset Strategy

Over 50% of allocations are in the US with the bulk of the remainder split between Japan, China &amp; HK and the major European nations.  The EMEA overweight is comprised mainly of the UK, Netherlands, France and Germany, with active managers running underweights in the US, China &amp; HK, Australia and Japan.UK allocations hover around their lowest levels in history, though managers remain stubbornly overweight compared to the MSCI AC World index.  A total of 62% of managers are overweight the UK at an average +1.88% above benchmark.  Global Value investors are approaching their largest ever overweight in UK stocks of 3.64% above benchmark.Another month, another slump in Japan exposure.  Average weights in Japan stand at an all-time low of 5.06% with 85.5% of funds exposed (another low). <a href="https://www.smartkarma.com/entities/sony-corp" target="_blank" data-smartkarma-citation="entities:563:1" rel="noopener">Sony Corp (6758 JP)</a> and <a href="https://www.smartkarma.com/entities/kddi-corp" target="_blank" data-smartkarma-citation="entities:639:1" rel="noopener">KDDI Corp (9433 JP)</a> are the most widely held stocks, with 23% and 21% of funds holding a position.Tech exposure is at record highs, though this is matched by a record underweight of -0.47%.  Indeed, the percentage of funds who are overweight technology has fallen to below 50% for the first time since the end of 2018, a sign that Global managers are tilting their portfolios away from Tech.German Industrials allocations have hit a 4-year high as more Global investors add exposure to the sector. <a href="https://www.smartkarma.com/entities/deutsche-post-ag" target="_blank" data-smartkarma-citation="entities:21608:1" rel="noopener">Deutsche Post AG (DPW GR)</a> and <a href="https://www.smartkarma.com/entities/siemens-ag" target="_blank" data-smartkarma-citation="entities:21713:1" rel="noopener">Siemens AG (SIE GR)</a> were the key stocks behind the move, with 4.2% and 2.4% of funds adding exposure over the last 6-months.Alibaba has seen closures by some of the larger holders in our analysis, led by American Funds Capital World Fund (-$1.1bn) and New Economy Fund (-$451m).  Though closures have dominated, selected funds have opened exposure during this period of volatility, including Invesco's Global Focus Fund and Liontrust's Global Income Fund.

Over 50% of allocations are in the US with the bulk of the remainder split between Japan, China &amp; HK and the major European nations.  The EMEA overweight is comprised mainly of the UK, Netherlands, France and Germany, with active managers running underweights in the US, China &amp; HK, Australia and Japan.UK allocations hover around their lowest levels in history, though managers remain stubbornly overweight compared to the MSCI AC World index.  A total of 62% of managers are overweight the UK at an average +1.88% above benchmark.  Global Value investors are approaching their largest ever overweight in UK stocks of 3.64% above benchmark.Another month, another slump in Japan exposure.  Average weights in Japan stand at an all-time low of 5.06% with 85.5% of funds exposed (another low). Sony Corp (6758 JP) and KDDI Corp (9433 JP) are the most widely held stocks, with 23% and 21% of funds holding a position.Tech exposure is at record highs, though this is matched by a record underweight of -0.47%.  Indeed, the percentage of funds who are overweight technology has fallen to below 50% for the first time since the end of 2018, a sign that Global managers are tilting their portfolios away from Tech.German Industrials allocations have hit a 4-year high as more Global investors add exposure to the sector. Deutsche Post AG (DPW GR) and Siemens AG (SIE GR) were the key stocks behind the move, with 4.2% and 2.4% of funds adding exposure over the last 6-months.Alibaba has seen closures by some of the larger holders in our analysis, led by American Funds Capital World Fund (-$1.1bn) and New Economy Fund (-$451m).  Though closures have dominated, selected funds have opened exposure during this period of volatility, including Invesco's Global Focus Fund and Liontrust's Global Income Fund.

Global Fund Positioning Update:  Japan Lows, US Highs, UK Value Rotation, Tencent & Alibaba Exit

Japan

KDDI CORPORATION provides mobile communication services and sells mobile devices.  The Company also is a broadband provider.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

KDDI Corp (9433 JP)

Growth in Cashless Payments Surges in Japan – PayPay Totally Dominant

Japan is shifting from 80-90% cash retail transactions to 40-50% cashless in the blink of an eye. Softbank/Z HD dominates with nearly 50% share and...

Michael Causton

Kakaku.com (2371 JP): Sheer Gamesmanship

In line with yesterday’s media articles, EQT/DG have increased its offer to JPY3,450, a 4.5% premium to its JPY3,300 offer (22 June). The closing...

Arun George

Convenience Stores: First Decline in 50 Years

For any investor in Japan's consumer staples sector, the convenience store sector is a key component. The following is an in-depth analysis of the...

Michael Causton

Japan Telecom Sector - Regulator to Signal Level Playing Field for DoCoMo

The regulator will block preferential pricing for DoCoMo within NTT. This is not surprising. The real issue is competition for enterprise users...

Kirk Boodry

Global Fund Positioning Update: Japan Lows, US Highs, UK Value Rotation, Tencent & Alibaba Exit

A detailed look at investor positioning among 380 active Global strategies, covering the major themes in country, sector and stock exposure.

Steven Holden

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)