Japan Specialist

Mark Chadwick

Equity Bottom-Up

Musashi Seimitsu Industry Co / Equity Bottom-Up

<ul>
<li>GMO takes a 5.1% stake in Musashi Seimitsu, targeting undervaluation and long-term upside from its supercapacitor business despite near-term margin pressure and auto sector weakness.</li>
<li>Simplex Capital backs Amiya, leveraging a Canon alliance and strong growth to accelerate expansion in Japan’s cybersecurity market through constructive activist engagement and operational support.</li>
<li>Silvercape Investments invests in Cyber Security Cloud, highlighting strong growth, market leadership in WAF, and valuation upside as operating leverage improves in Japan’s expanding cybersecurity sector.</li>
</ul>


GMO takes a 5.1% stake in Musashi Seimitsu, targeting undervaluation and long-term upside from its supercapacitor business despite near-term margin pressure and auto sector weakness.
Simplex Capital backs Amiya, leveraging a Canon alliance and strong growth to accelerate expansion in Japan’s cybersecurity market through constructive activist engagement and operational support.
Silvercape Investments invests in Cyber Security Cloud, highlighting strong growth, market leadership in WAF, and valuation upside as operating leverage improves in Japan’s expanding cybersecurity sector.


Japan Activism Briefs | Musashi Seimitsu, Amiya, Cyber Security

Cyber Security Cloud Inc / Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/cyber-security-cloud-inc" target="_blank" data-smartkarma-citation="entities:29137:1" rel="noopener">Cyber Security Cloud Inc (4493 JP)</a>  (CSC) a fast-growing web security company that provides B2B Web Application FireWall (WAF) security, primarily to Japanese companies. The company uses AI to help detect and respond to threats, delivered through its three product offerings: Shadankun, WAF Charm, and AWS Managed Service.  This note looks at the Q3 results, where sales rose 44% YoY.  
For a more detailed view of the company, market, moat and management, please take a quick look at the following:  <a href="https://www.smartkarma.com/insights/small-cap-growth-cyber-security-cloud-4493-japan-s-security-patch" target="_blank" data-smartkarma-citation="insights:43624" rel="noopener">Small Cap Growth: Cyber Security Cloud (4493) – Japan's Security Patch</a>

Cyber Security Cloud Inc (4493 JP)  (CSC) a fast-growing web security company that provides B2B Web Application FireWall (WAF) security, primarily to Japanese companies. The company uses AI to help detect and respond to threats, delivered through its three product offerings: Shadankun, WAF Charm, and AWS Managed Service.   This note looks at the Q3 results, where sales rose 44% YoY.  
For a more detailed view of the company, market, moat and management, please take a quick look at the following:  Small Cap Growth: Cyber Security Cloud (4493) – Japan's Security Patch 

Small Cap Growth: Cyber Security Cloud (4493) –Another Strong Quarter

Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Quantitative Analysis

In late July 2020, the Tokyo Stock Exchange issued Revisions to Listing Rules to Enhance Functions for Raising Funds through the Capital Market. These were discussed by <a href="https://www.smartkarma.com/profiles/travis-lundy" target="_blank" data-smartkarma-citation="accounts:25" rel="noopener">Travis Lundy</a> in <a href="https://www.smartkarma.com/insights/the-tse-s-listing-criteria-revisions-part-i" target="_blank" data-smartkarma-citation="insights:43150" rel="noopener">The TSE's Listing Criteria Revisions - Part I</a>.These revisions have very important implications to Pre-event trades in the TOPIX Inclusions Universe as fewer candidates will be able to meet these more-stringent new requirements. In this insight, we take a look at how these new requirements will influence our Pre-event trades. In addition, I have also provided performance updates for 5 "Live" events which have announced their TSE1 move in September 2020 and 6 "Post" events that involves stocks which have already had their Inclusion events in August 2020. As noted last month, unusually there were no inclusions for September due to section/segment reassignment.As always, there is more below the fold.

In late July 2020, the Tokyo Stock Exchange issued Revisions to Listing Rules to Enhance Functions for Raising Funds through the Capital Market. These were discussed by Travis Lundy in The TSE's Listing Criteria Revisions - Part I.These revisions have very important implications to Pre-event trades in the TOPIX Inclusions Universe as fewer candidates will be able to meet these more-stringent new requirements. In this insight, we take a look at how these new requirements will influence our Pre-event trades. In addition, I have also provided performance updates for 5 "Live" events which have announced their TSE1 move in September 2020 and 6 "Post" events that involves stocks which have already had their Inclusion events in August 2020. As noted last month, unusually there were no inclusions for September due to section/segment reassignment.As always, there is more below the fold. 

<blockquote>Japan Inc IT needs a security patch -The Economist (July 18, 2020). </blockquote>The Economist headline succinctly captures the challenges facing Japan Inc. In January, Mitsubishi Electric (6503) and NEC (6701) reported security breaches. Under COVID-19, the shift to telework from unsecured devices spurned a rise in cyberattacks. Low IT security budgets and ignorance of cybersecurity are hurting corporate Japan. Going forward, these breaches are likely to force a reassessment, towards great awareness and greater spending on Cybersecurity. Enter <a href="https://www.smartkarma.com/entities/cyber-security-cloud-inc" target="_blank" data-smartkarma-citation="entities:29137:1" rel="noopener">Cyber Security Cloud Inc (4493 JP)</a>  (CSC).

Japan Inc IT needs a security patch -The Economist (July 18, 2020). The Economist headline succinctly captures the challenges facing Japan Inc. In January, Mitsubishi Electric (6503) and NEC (6701) reported security breaches. Under COVID-19, the shift to telework from unsecured devices spurned a rise in cyberattacks. Low IT security budgets and ignorance of cybersecurity are hurting corporate Japan. Going forward, these breaches are likely to force a reassessment, towards great awareness and greater spending on Cybersecurity. Enter Cyber Security Cloud Inc (4493 JP)  (CSC).    

Small Cap Growth: Cyber Security Cloud (4493) – Japan's Security Patch

The month of August has been a fairly quiet one as far as TSE1 promotion announcements go. At the time of writing, there has been only one TSE1 promotion so far this month - <a href="https://www.smartkarma.com/insights/topix-inclusion-7059-jp-copro-holdings" target="_blank" data-smartkarma-citation="insights:42694" rel="noopener">TOPIX Inclusion (7059 JP): COPRO Holdings</a> (though another was announced after the close today).  
In this month's summary, I have provided performance updates for our "Pre-event" strategies and discussed 9 "Post" events which involve stocks which had their Inclusion Events at the end of July and August 2020. 
As always, there is more below the fold.

The month of August has been a fairly quiet one as far as TSE1 promotion announcements go. At the time of writing, there has been only one TSE1 promotion so far this month - TOPIX Inclusion (7059 JP): COPRO Holdings (though another was announced after the close today).  
In this month's summary, I have provided performance updates for our "Pre-event" strategies and discussed 9 "Post" events which involve stocks which had their Inclusion Events at the end of July and August 2020. 
As always, there is more below the fold. 

Japan

Cyber Security Cloud, Inc. offers information technology services. The Company provides web security evelopment, cyber attack research and analysis, artificial intelligenceI technology research and development, and other services. Cyber Security Cloud offers its services throughout Japan.

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Cyber Security Cloud Inc (4493 JP)

Japan Activism Briefs | Musashi Seimitsu, Amiya, Cyber Security

GMO takes a 5.1% stake in Musashi Seimitsu Industry, targeting undervaluation and long-term upside from its supercapacitor business despite near...

Mark Chadwick

Small Cap Growth: Cyber Security Cloud (4493) –Another Strong Quarter

Cyber Security Cloud is a high growth web security company that provides WAF security to Japanese companies. MRQ sales growth was 44%, with strong...

Mark Chadwick

TOPIX Inclusion Trade Summary: Sep 2020

The Tokyo Stock Exchange will be introducing new requirement

Janaghan Jeyakumar, CFA

Small Cap Growth: Cyber Security Cloud (4493) – Japan's Security Patch

"Japan Inc IT needs a security patch" - The Economist (July 18, 2020).

Mark Chadwick

TOPIX Inclusion Trade Summary: Aug 2020

A monthly round-up of TSE Section Transfer (upwards) and future index inclusion-related events including the high-return Quiddity Post-IPO Strategy

Janaghan Jeyakumar, CFA

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