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. 

Equity Bottom-Up

<ul>
<li>Thanks to the huge supply chain capabilities of its parent <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a>, <a href="https://www.smartkarma.com/entities/familymart-co-ltd" target="_blank" data-smartkarma-citation="entities:320:1" rel="noopener">FamilyMart Co Ltd (8028 JP)</a> is moving into new categories of private label product.</li>
<li>These are not the traditional staples of the convenience store but new types of more fashionable lifestyle products in clothing and cosmetics.</li>
<li>Recent results show successful collaboration with Noin for cosmetics and with Hiromichi Ochiai from Facetasm for clothing basics, selling more than 1 million items each.</li>
</ul>


Thanks to the huge supply chain capabilities of its parent Itochu Corp (8001 JP), FamilyMart Co Ltd (8028 JP) is moving into new categories of private label product.
These are not the traditional staples of the convenience store but new types of more fashionable lifestyle products in clothing and cosmetics.
Recent results show successful collaboration with Noin for cosmetics and with Hiromichi Ochiai from Facetasm for clothing basics, selling more than 1 million items each.


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

Telco/Internet specialist

Kirk Boodry

Redex Research

<ul>
<li>The core eCommerce and Fintech segments posted good results for the quarter but that will certainly get lost in the discussion on mobile</li>
<li>Mobile operating losses exceeded $1bn in Q4 and whilst management is guiding to losses bottoming out in Q1 22, the magnitude of improvements remains undefined</li>
<li>Rakuten Mobile capex is on par with incumbents and will remain unchanged in FY22</li>
</ul>


The core eCommerce and Fintech segments posted good results for the quarter but that will certainly get lost in the discussion on mobile
Mobile operating losses exceeded $1bn in Q4 and whilst management is guiding to losses bottoming out in Q1 22, the magnitude of improvements remains undefined
Rakuten Mobile capex is on par with incumbents and will remain unchanged in FY22


Rakuten (Neutral) - Q4 21 Results Reaction: Hard to Look past Mobile Losses

NTT (Nippon Telegraph & Telephone) / Equity Bottom-Up

<ul>
<li>NTT has raised financial guidance by 1-2% on upside at subsidiary NTT Data</li>
<li>A corresponding increase in the FY21 dividend from ¥110 to ¥115 provides a near-term reward for shareholders</li>
<li>We are raising our target price from ¥3,600 to ¥4,000 and remain at Buy</li>
</ul>


NTT has raised financial guidance by 1-2% on upside at subsidiary NTT Data
A corresponding increase in the FY21 dividend from ¥110 to ¥115 provides a near-term reward for shareholders
We are raising our target price from ¥3,600 to ¥4,000 and remain at Buy


NTT (Buy) - Q3 21 Results Reaction: NTT Data Drives Beat and Raise with Dividend Boost

<ul>
<li>We had a chat with KDDI after results last week including clarification on issues that came up on the analyst call (3G network shutdown, Q4 impacts on operating profit)</li>
<li>The competitive environment in mobile looks similar to Q2 but wider distribution for sub-brands UQ (retail store presence) and Povo (first full quarter of availability) helped drive user growth</li>
<li>We have updated our forecasts for Q3 results and remain at Buy</li>
</ul>


We had a chat with KDDI after results last week including clarification on issues that came up on the analyst call (3G network shutdown, Q4 impacts on operating profit)
The competitive environment in mobile looks similar to Q2 but wider distribution for sub-brands UQ (retail store presence) and Povo (first full quarter of availability) helped drive user growth
We have updated our forecasts for Q3 results and remain at Buy


KDDI (Buy) - Follow-Up After Q3 21 Results

Japan

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

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KDDI Corp (9433 JP)

Familymart, the Lifestyle Store

Itochu always intended to make better use of its vast network of suppliers to improve both the merchandise mix at Familymart and also gross...

Michael Causton

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

Rakuten (Neutral) - Q4 21 Results Reaction: Hard to Look past Mobile Losses

Rakuten’s mobile business is losing a billion dollars per quarter and capital spending is higher than incumbents. That is going to obscure solid...

Kirk Boodry

NTT (Buy) - Q3 21 Results Reaction: NTT Data Drives Beat and Raise with Dividend Boost

NTT has boosted full-year guidance and the dividend on solid financial results from NTT Data. We are raising our target price and remain at Buy.

Kirk Boodry

KDDI (Buy) - Follow-Up After Q3 21 Results

We are relatively sanguine about the impact of the 3G network shutdown whilst drivers behind the growth in consumer mobile subscriptions are...

Kirk Boodry

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