Focus on Smaller Cap Value Names, Altay Capital

Altay Capital

Focus on Smaller Cap Value Names

Long time value investor. Long/Short portfolio that’s always net long (between 30-80%). I have extensive experience in the video game industry as I founded a leading media company in the space, which I have since exited after an acquisition. Gaming companies only make up ~15% of my portfolio, but its a sector where I believe I have an edge. A newsletter about value investing! Mostly focus on smaller cap value names that aren't widely covered.

Thematic (Sector/Industry)

<ul><li>I initially began my cheap Japanese basket in March 2023 and now that 2023 has come to an end, let’s take a look at how everything worked out.</li><li>But first, a quick summary of the themes in my basket and why I’m broadly still bullish on deep value Japan.</li><li>Within my basket of cheap Japanese companies, there are 3 broad themes: higher quality businesses with better RoEs and P/TBV closer to 0.7x, dirt cheap deep value net nets with P/TBV of 0.2-0.4x, and deeply discounted companies with underappreciated land assets</li></ul>

I initially began my cheap Japanese basket in March 2023 and now that 2023 has come to an end, let’s take a look at how everything worked out.But first, a quick summary of the themes in my basket and why I’m broadly still bullish on deep value Japan.Within my basket of cheap Japanese companies, there are 3 broad themes: higher quality businesses with better RoEs and P/TBV closer to 0.7x, dirt cheap deep value net nets with P/TBV of 0.2-0.4x, and deeply discounted companies with underappreciated land assets

The Cheap Japanese Basket: Year-End Portfolio Review and Reasons Why I Remain Bullish

Equity Bottom-Up

<ul>
<li>Asagami Corporation (TYO 9311) owns 3 warehouses on Tokyo Harbor with land carried on its books at ¥7.9 billion.</li>
<li>These properties alone are likely worth closer to ¥29.5 billion.</li>
<li>These assets account for less than half of the company’s land assets, but are worth multiples of the current market cap of just ¥7.16B.</li>
</ul>


Asagami Corporation (TYO 9311) owns 3 warehouses on Tokyo Harbor with land carried on its books at ¥7.9 billion.
These properties alone are likely worth closer to ¥29.5 billion.
These assets account for less than half of the company’s land assets, but are worth multiples of the current market cap of just ¥7.16B.


Asagami Corporation - Example of Widespread Undervaluation of Land on Japanese Balance Sheets

Japan

ASAGAMI CORPORATION operates warehousing and handles exported and imported cargoes mainly for sundry goods in the Tokyo metropolitan area.  The Company also manages distribution centers and operates in real estate including resort development.

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Asagami Corp (9311 JP)

The Cheap Japanese Basket: Year-End Portfolio Review and Reasons Why I Remain Bullish

I initially began my cheap Japanese basket in March 2023 and now that 2023 has come to an end, let’s take a look at how everything worked out.

Altay Capital

Asagami Corporation - Example of Widespread Undervaluation of Land on Japanese Balance Sheets

Example of Widespread Undervaluation of Land on Japanese Balance Sheets. Disparity Between Book and Market Value is 3x Market Cap On Just 3...

Altay Capital

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