Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

Heightened trade tensions have caused global equities to move from resistance to support in a matter of days. Additional consolidation - i.e., no breakdowns - on the broad global indexes (MSCI ACWI, ACWI ex-US, EAFE, and EM) remains the most likely scenario. At the same time, new cracks are beginning to show and as a result we believe global equities are vulnerable to a breakdown.  Along with a recap of important technical levels across major markets, we flip through several attractive Groups and stocks within Advertising, retail, restaurants, and travel, which offer attractive pullback opportunities.

Heightened trade tensions have caused global equities to move from resistance to support in a matter of days. Additional consolidation - i.e., no breakdowns - on the broad global indexes (MSCI ACWI, ACWI ex-US, EAFE, and EM) remains the most likely scenario. At the same time, new cracks are beginning to show and as a result we believe global equities are vulnerable to a breakdown.  Along with a recap of important technical levels across major markets, we flip through several attractive Groups and stocks within Advertising, retail, restaurants, and travel, which offer attractive pullback opportunities.

Global Equity Strategy: Another Test of Support

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.

Index Rebalance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lenskart-solutions-limited" target="_blank" data-smartkarma-citation="entities:45634:1" rel="noopener">Lenskart Solutions (LENSKART IN)</a> (LS) raised around US$825m in its India IPO in November 2025. The lockup on its pre-IPO investors is set to expire soon.</li>
<li>Lenskart Solutions Limited (LSL) is a technology-driven eyewear company with integrated operations spanning designing, manufacturing, branding and retailing of eyewear products.</li>
<li>In this note, we will talk about the lockup dynamics and possible placement.</li>
</ul>



Lenskart Solutions (LENSKART IN) (LS) raised around US$825m in its India IPO in November 2025. The lockup on its pre-IPO investors is set to expire soon.
Lenskart Solutions Limited (LSL) is a technology-driven eyewear company with integrated operations spanning designing, manufacturing, branding and retailing of eyewear products.
In this note, we will talk about the lockup dynamics and possible placement.


Aequitas: Lenskart Lockup Expiry - US$6.7bn Lockup Release with Everyone Well in the Money

'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

ja research

ja research is an independent research platform focused exclusively on Japanese equities. Leveraging data and graphic analysis provided by Japan Analytics, we provide insights on small and medium-sized companies that have been ignored by the sell-side as well as challenging conventional wisdom on larger companies. We also offer analyst and corporate access, the latter with translation if required. 

Thematic (Sector/Industry)

TURNING POINT - Despite the last four trading days being 'up', the Japanese equity market composite fell by 0.6% over the last two weeks. New 52-week lows outnumbered new highs by 6.7:1 and new lows have exceeded new highs for the last sixteen days. This post-results 'malaise' is most noticeable in the lack of market activity.  Four of the last six trading days have seen the Value Traded/Total Market Value ratio fall below 30 basis points.  Other than at the turn of the year, such levels of trading 'apathy' (marked▲on the chart below) usually coincide with changes in market direction which, in current circumstances would suggest some upside from current levels.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/061/735/original/2018-08-25_21-33-47.png?1535271873" class="editor-image img-responsive" data-smartkarma-image-id="61735"></figure><div class="content-caption">Source: Japan Analytics</div>SECTOR TRENDS - Only seven sectors rose by more than 1% in the last two weeks, led by Commercial Services, Multi-Industry, Media and Information Technology and only eight are up over three months. Overall the market composite has fallen by 2.9% since the end of May.  Twelve sectors have decreased by more than 1% since 10th August with Metals, Telecommunications, Autos and Consumer Services all down by more than 2%. Over both periods, and in all regards, the Energy sector is the outlier and remains attractively priced at below book value and on 8x TTM Net Income. RESULTS &amp; REVISIONS - Only 213 results and revision announcements occurred in the last two weeks, with <a href="https://www.smartkarma.com/entities/109" target="_blank" data-smartkarma-citation="entities:109:1">Idemitsu Kosan (5019 JP)</a>, <a href="https://www.smartkarma.com/entities/4909" target="_blank" data-smartkarma-citation="entities:4909:1">Hikari Tsushin (9435 JP)</a>, <a href="https://www.smartkarma.com/entities/14750" target="_blank" data-smartkarma-citation="entities:14750:1">Rizap (2928 JP)</a>, <a href="https://www.smartkarma.com/entities/24540" target="_blank" data-smartkarma-citation="entities:24540:1">SanBio (4592 JP)</a> <a href="https://www.smartkarma.com/entities/20495" target="_blank" data-smartkarma-citation="entities:20495:1">Amuse (4301 JP)</a> and <a href="https://www.smartkarma.com/entities/19550" target="_blank" data-smartkarma-citation="entities:19550:1">Open House (3288 JP)</a> being the most impactful in terms of changes in scoring.PRICE SCORE &amp; VALUATION - Banks continue to be 'Oversold' and 'Deep Value', while Commercial and Consumer Services are both 'Overbought' and 'Fully Priced'. Information Technology, a preferred sector, is now 'Fully Priced' and is close to being 'Overbought' but we would hold current positions for the time being. OUTLOOK - If the market were to see a rebound, the catalyst could be a weaker currency or a new post-re-election policy platform from PM Abe. Indeed, last week's statement by Chief Cabinet Secretary Suga that mobile phone charges need to fall by 40% suggests a more pro-active and populist third term. In any event, some mean reversion in current sector trends is likely.

TURNING POINT - Despite the last four trading days being 'up', the Japanese equity market composite fell by 0.6% over the last two weeks. New 52-week lows outnumbered new highs by 6.7:1 and new lows have exceeded new highs for the last sixteen days. This post-results 'malaise' is most noticeable in the lack of market activity.  Four of the last six trading days have seen the Value Traded/Total Market Value ratio fall below 30 basis points.  Other than at the turn of the year, such levels of trading 'apathy' (marked▲on the chart below) usually coincide with changes in market direction which, in current circumstances would suggest some upside from current levels.Source: Japan AnalyticsSECTOR TRENDS - Only seven sectors rose by more than 1% in the last two weeks, led by Commercial Services, Multi-Industry, Media and Information Technology and only eight are up over three months. Overall the market composite has fallen by 2.9% since the end of May.  Twelve sectors have decreased by more than 1% since 10th August with Metals, Telecommunications, Autos and Consumer Services all down by more than 2%. Over both periods, and in all regards, the Energy sector is the outlier and remains attractively priced at below book value and on 8x TTM Net Income. RESULTS &amp; REVISIONS - Only 213 results and revision announcements occurred in the last two weeks, with Idemitsu Kosan (5019 JP), Hikari Tsushin (9435 JP), Rizap (2928 JP), SanBio (4592 JP) Amuse (4301 JP) and Open House (3288 JP) being the most impactful in terms of changes in scoring.PRICE SCORE &amp; VALUATION - Banks continue to be 'Oversold' and 'Deep Value', while Commercial and Consumer Services are both 'Overbought' and 'Fully Priced'. Information Technology, a preferred sector, is now 'Fully Priced' and is close to being 'Overbought' but we would hold current positions for the time being. OUTLOOK - If the market were to see a rebound, the catalyst could be a weaker currency or a new post-re-election policy platform from PM Abe. Indeed, last week's statement by Chief Cabinet Secretary Suga that mobile phone charges need to fall by 40% suggests a more pro-active and populist third term. In any event, some mean reversion in current sector trends is likely. 

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/061/034/original/2018-08-16_19-07-34.png?1534672507" class="editor-image img-responsive" data-smartkarma-image-id="61034"></figure><div class="content-caption">Source: Japan Analytics</div>A GOOD QUARTER - The Composite Results Score has now declined for seven months in a row and is implying a slowing of the upward momentum in earnings.  However, the score has only declined by 31 basis points since last quarter showing a degree of 'stability' seen only in 2011 in recent years.  The aggregate Forecast/Revision score has also continued to decline and is now lower for the fourth straight month. As would be expected, this score is a reliable leading indicator for the Results Score and suggests further weakening in the rate of earnings growth in the months ahead.  Neither score is, as yet, suggesting a decline in earnings before the end of the fiscal year.YEN CORRELATION WEAKENING - This quarter's earnings' stability was surprising given the relative strength of the Yen compared to a year ago. In the past and even as recently as 2016, a 5 per cent year-on-year decline has resulted in negative Results Scores. The year-on-year change in now positive so any negative impact will dissipate over the next two quarters.MARKET FOLLOWS MOMENTUM LOWER - The All Market Composite peaked on 23rd January and has since fallen by 11% despite a continuation of the Bank of Japan's ETF purchasing programme. Weakening earnings momentum and the overvaluation of many of the leading stocks, as in our '<a href="https://www.smartkarma.com/insights/japan-most-overbought-most-oversold-the-relative-price-score" target="_blank" data-smartkarma-citation="insights:21149">Nifty 50</a>' portfolio, have been contributing factors. With prospects for a much weaker Yen limited by the current trade negotiations between Japan and the United States, and with global growth slowing, we expect both Results and Revision Scores to trend lower, but to end the fiscal year in positive territory. Historically, the market has not risen during periods when both the Results and Forecast/Revision Scores have been trending down.<div class="content-highlight">MARKET RECOMMENDATION - Within a global portfolio, we would market-weight Japanese equities with a bias towards domestic sectors and not hedge the currency exposure.</div>SECTOR RESULTS SCORES -The good news is that only one sector, (Multi-Industry - 75% of which is <a href="https://www.smartkarma.com/entities/359" target="_blank" data-smartkarma-citation="entities:359:1">Japan Post [6178 JP</a>]) has a negative score - and its score is less negative than last quarter. Both the Media and Consumer Services sectors' scores turned positive and each increased by more than two points.  On the other hand, over half of our 29 sectors saw declining scores, although the number was lower than last quarter.  The top sectors in terms of quarter-on-quarter change were Energy, Consumer Services, Media, Information Technology and Other Commercial Products while the laggards were Non-Bank Finance, Chemicals, Construction, Machinery and Utilities. SECTOR REVISION SCORES - Five sectors have negative Forecast/Revision Scores with Utilities now joining Media, Multi-Industry, Autos and Banks from last quarter. The highest scores are in the Energy, Technology Hardware, Electrical Equipment, Retail and Information Technology sectors. Improvements of greater than one point were seen in Energy, Media and Machinery while Food, Beverages &amp; Tobacco, Chemicals, Utilities, Other Materials and Technology Hardware all lost more than one point. Overall eighteen sectors saw declines.REVISION V. RESULTS SCORES - The difference between the Results and Revision Scores is a good indicator of corporate expectations compared with the trailing-twelve-month reality. In some cases (e.g. Restaurants) the 'optimism' is due to a failure to revise forecasts in the light of weaker results. In others, such as Telecommunications, there is scope for upward revisions in the coming quarters.<div class="content-highlight">
THE OPTIMISTS
Restaurants • Other Materials • Electrical Equipment • Technology Hardware • Retail
THE PESSIMISTS
Banks • Autos • Telecommunications • Utilities • Media • Chemicals
</div>SECTOR PERFORMANCE - Over the last three months, our Japan Market Composite declined by 5.8%. Only four sectors saw an increase in value led by Telecommunications, Energy, Commercial Services and Information Technology. The largest declines were in the Building Materials, Metals, Real Estate Construction and Machinery sectors. Nine sectors are now negative over one year led by Building Materials, Metals and Food, Beverages &amp; Tobacco and only eight are up in double-digits led by Services and Information Technology. For the time being, Domestic Non-Manufacturing sectors 'rules the roost' and Domestic Cyclical sectors have taken over from Global Cyclicals in the 'doghouse'.'.<div class="content-highlight">
SECTOR RECOMMENDATIONS
Our most-preferred sectors are currently Energy, Healthcare, Telecommunications, Other Commercial Products and Information Technology.
Least-preferred sectors are Metals, Chemicals, Machinery, Autos, Construction, Real Estate, Building Materials, Food Beverages &amp; Tobacco and Utilities.
</div>TOP 5 LARGER PEER GROUPS - The top five Peer Groups capitalised at over ¥1 trillion are Machine Tools &amp; Presses, PC &amp; Computer Peripherals, Oil &amp; Gas Refining &amp; Marketing, Telecom Distribution Services and Sporting &amp; Outdoor Goods. The top twenty larger Peer Groups have gained 16% over one year but have declined by 4% on average the last three months.BOTTOM 5 LARGER PEER GROUPS - The bottom five Peer Groups capitalised at over ¥1 trillion are Audio/Visual Content, LCD/LED Materials &amp; Equipment, Electrical Engineering, General Contractors and Real Estate - Leasing. The bottom twenty larger Peer Groups have lost 2% over one year and 9% over the last three months. Only Security Services and Tobacco have risen since May.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/061/038/original/2018-08-19_19-33-03.png?1534674804" class="editor-image img-responsive" data-smartkarma-image-id="61038"></figure>

Source: Japan AnalyticsA GOOD QUARTER - The Composite Results Score has now declined for seven months in a row and is implying a slowing of the upward momentum in earnings.  However, the score has only declined by 31 basis points since last quarter showing a degree of 'stability' seen only in 2011 in recent years.  The aggregate Forecast/Revision score has also continued to decline and is now lower for the fourth straight month. As would be expected, this score is a reliable leading indicator for the Results Score and suggests further weakening in the rate of earnings growth in the months ahead.  Neither score is, as yet, suggesting a decline in earnings before the end of the fiscal year.YEN CORRELATION WEAKENING - This quarter's earnings' stability was surprising given the relative strength of the Yen compared to a year ago. In the past and even as recently as 2016, a 5 per cent year-on-year decline has resulted in negative Results Scores. The year-on-year change in now positive so any negative impact will dissipate over the next two quarters.MARKET FOLLOWS MOMENTUM LOWER - The All Market Composite peaked on 23rd January and has since fallen by 11% despite a continuation of the Bank of Japan's ETF purchasing programme. Weakening earnings momentum and the overvaluation of many of the leading stocks, as in our 'Nifty 50' portfolio, have been contributing factors. With prospects for a much weaker Yen limited by the current trade negotiations between Japan and the United States, and with global growth slowing, we expect both Results and Revision Scores to trend lower, but to end the fiscal year in positive territory. Historically, the market has not risen during periods when both the Results and Forecast/Revision Scores have been trending down.MARKET RECOMMENDATION - Within a global portfolio, we would market-weight Japanese equities with a bias towards domestic sectors and not hedge the currency exposure.SECTOR RESULTS SCORES -The good news is that only one sector, (Multi-Industry - 75% of which is Japan Post [6178 JP]) has a negative score - and its score is less negative than last quarter. Both the Media and Consumer Services sectors' scores turned positive and each increased by more than two points.  On the other hand, over half of our 29 sectors saw declining scores, although the number was lower than last quarter.  The top sectors in terms of quarter-on-quarter change were Energy, Consumer Services, Media, Information Technology and Other Commercial Products while the laggards were Non-Bank Finance, Chemicals, Construction, Machinery and Utilities. SECTOR REVISION SCORES - Five sectors have negative Forecast/Revision Scores with Utilities now joining Media, Multi-Industry, Autos and Banks from last quarter. The highest scores are in the Energy, Technology Hardware, Electrical Equipment, Retail and Information Technology sectors. Improvements of greater than one point were seen in Energy, Media and Machinery while Food, Beverages &amp; Tobacco, Chemicals, Utilities, Other Materials and Technology Hardware all lost more than one point. Overall eighteen sectors saw declines.REVISION V. RESULTS SCORES - The difference between the Results and Revision Scores is a good indicator of corporate expectations compared with the trailing-twelve-month reality. In some cases (e.g. Restaurants) the 'optimism' is due to a failure to revise forecasts in the light of weaker results. In others, such as Telecommunications, there is scope for upward revisions in the coming quarters.
THE OPTIMISTS
Restaurants • Other Materials • Electrical Equipment • Technology Hardware • Retail
THE PESSIMISTS
Banks • Autos • Telecommunications • Utilities • Media • Chemicals
SECTOR PERFORMANCE - Over the last three months, our Japan Market Composite declined by 5.8%. Only four sectors saw an increase in value led by Telecommunications, Energy, Commercial Services and Information Technology. The largest declines were in the Building Materials, Metals, Real Estate Construction and Machinery sectors. Nine sectors are now negative over one year led by Building Materials, Metals and Food, Beverages &amp; Tobacco and only eight are up in double-digits led by Services and Information Technology. For the time being, Domestic Non-Manufacturing sectors 'rules the roost' and Domestic Cyclical sectors have taken over from Global Cyclicals in the 'doghouse'.'.
SECTOR RECOMMENDATIONS
Our most-preferred sectors are currently Energy, Healthcare, Telecommunications, Other Commercial Products and Information Technology.
Least-preferred sectors are Metals, Chemicals, Machinery, Autos, Construction, Real Estate, Building Materials, Food Beverages &amp; Tobacco and Utilities.
TOP 5 LARGER PEER GROUPS - The top five Peer Groups capitalised at over ¥1 trillion are Machine Tools &amp; Presses, PC &amp; Computer Peripherals, Oil &amp; Gas Refining &amp; Marketing, Telecom Distribution Services and Sporting &amp; Outdoor Goods. The top twenty larger Peer Groups have gained 16% over one year but have declined by 4% on average the last three months.BOTTOM 5 LARGER PEER GROUPS - The bottom five Peer Groups capitalised at over ¥1 trillion are Audio/Visual Content, LCD/LED Materials &amp; Equipment, Electrical Engineering, General Contractors and Real Estate - Leasing. The bottom twenty larger Peer Groups have lost 2% over one year and 9% over the last three months. Only Security Services and Tobacco have risen since May.

Japan: Results & Revision Scores Summer 2018 Update - Market Composite, Sectors & Peer Groups

DOMESTIC  DEFENSIVE SECTORS ▲ GLOBAL CYCLICAL SECTORS ▼ -  The Q1 trend shift away from global cyclical sectors accelerated in the second quarter and all of these sectors saw declines in weight over the last three months.SECTOR RECOMMENDATIONS - Our most preferred sectors are currently Healthcare, Energy, Other Commercial Products, Utilities and Information Technology and least preferred sectors are Multi-Industry, Metals, Chemicals, Autos, Machinery, Banks and Consumer Services.MARKET OUTLOOK MIXED - With manufacturing sectors comprising 60% of the market and with many domestic sectors now fully-valued, it is hard to see the market making much headway over the rest of the summer.

DOMESTIC  DEFENSIVE SECTORS ▲ GLOBAL CYCLICAL SECTORS ▼ -  The Q1 trend shift away from global cyclical sectors accelerated in the second quarter and all of these sectors saw declines in weight over the last three months.SECTOR RECOMMENDATIONS - Our most preferred sectors are currently Healthcare, Energy, Other Commercial Products, Utilities and Information Technology and least preferred sectors are Multi-Industry, Metals, Chemicals, Autos, Machinery, Banks and Consumer Services.MARKET OUTLOOK MIXED - With manufacturing sectors comprising 60% of the market and with many domestic sectors now fully-valued, it is hard to see the market making much headway over the rest of the summer.

Japan : Q2 Sector & Company Performance Review

Japan

Hoya Corp manufactures electro-optics products such as mask blanks for semiconductors, photomasks for LCD panels, optical glasses, glass memory disks for HDDs, medical flexible endoscopes, eyeglasses, and contact lenses. The Company also provides information system architecture.

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Hoya Corp (7741 JP)

Global Equity Strategy: Another Test of Support

Heightened trade tensions have caused global equities to move from resistance to support in a matter of days. Additional consolidation - i.e., no...

Vermilion Research

Aequitas: Lenskart Lockup Expiry - US$6.7bn Lockup Release with Everyone Well in the Money

This time around softbank is looking to raise around US$300m via selling some of its stake in Lenskart. The deal is being run by GS.

Sumeet Singh

Japan Fortnightly Update: Turning Point

TURNING POINT - Despite the last four trading days being 'up', the Japanese equity market composite fell by 0.6% over the last two weeks. New...

Campbell Gunn

Japan: Results & Revision Scores Summer 2018 Update - Market Composite, Sectors & Peer Groups

A GOOD QUARTER - The Composite Results Score has now declined for seven months in a row and is implying a slowing of the upward momentum in...

Campbell Gunn

Japan : Q2 Sector & Company Performance Review

DOMESTIC DEFENSIVE SECTORS ▲ GLOBAL CYCLICAL SECTORS ▼ - The Q1 trend shift away from global cyclical sectors accelerated in the second quarter...

Campbell Gunn

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