Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

<div class="content-highlight"><p><strong>We have a positive view on <a href="https://www.smartkarma.com/entities/24075" target="_blank" data-smartkarma-citation="entities:24075:1">Hyundai Heavy Industries Holdings (267250 KS)</a> (HHIH). Our sum-of-the-parts analysis suggests a base case implied value per share of 499,600 won, which would represent an 18% upside from current levels. </strong>The biggest IPO in Korea is expected to be Hyundai Oilbank, in which HHIH has a 91.1% stake. The Hyundai Oilbank IPO is expected to be completed in 4Q18. Given that the stock market tends to look forward 6-12 months, the expectation of the biggest IPO in Korea (Hyundai…</p></div>

We have a positive view on Hyundai Heavy Industries Holdings (267250 KS) (HHIH). Our sum-of-the-parts analysis suggests a base case implied value per share of 499,600 won, which would represent an 18% upside from current levels. The biggest IPO in Korea is expected to be Hyundai Oilbank, in which HHIH has a 91.1% stake. The Hyundai Oilbank IPO is expected to be completed in 4Q18. Given that the stock market tends to look forward 6-12 months, the expectation of the biggest IPO in Korea (Hyundai…

Hyundai Heavy Industries Holdings - Update on Its Implied Valuation

Japan TMT Analyst

Pelham Smithers

Market Intel on Asian Tech with a Japan focus

Pelham Smithers Associates

Founded in 2009, Pelham Smithers Associates (PSA) provides market intelligence on Asian technology, focusing in particular on Japan. The industries covered by our team of specialists are: consumer electronics, telecomms, pharmaceuticals, internet, electronic parts and materials, automotive technology, retail and capital goods. 

Research is provided by the following:
Pelham Smithers: Macro, consumer electronics, telecoms & pharma
Joel Scheiman: Electronics materials / components
Julie Boote: Autos
Will Nestuk: Capital goods, machinery & transportation equipment parts
Thao Nguyen: eCommerce, internet content, marketing & advertising

Thematic (Sector/Industry)

<p>It is widely observed that the Japanese stock market performs poorly in calendar 1Q and seems to do okay for the rest of the year. With that in mind, and taking advantage of the fact that Japanese quiet season has become Trappist in the extreme, we undertook a three week 12-city marketing trip of the US and Canada, based around twelve large cap recommendations (split into quality and speculative), twelve small-cap recommendations and six negative ones. The recommendations were from across the…</p>

It is widely observed that the Japanese stock market performs poorly in calendar 1Q and seems to do okay for the rest of the year. With that in mind, and taking advantage of the fact that Japanese quiet season has become Trappist in the extreme, we undertook a three week 12-city marketing trip of the US and Canada, based around twelve large cap recommendations (split into quality and speculative), twelve small-cap recommendations and six negative ones. The recommendations were from across the…

Observations from Three Weeks Marketing Japanese Equities in the US

Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<p><a href="https://www.smartkarma.com/entities/752" target="_blank" data-smartkarma-citation="entities:752:1">Fanuc Corp (6954 JP)</a> shocked markets last Thursday by forecasting a 34% drop in OP, together with somewhat underwhelming results. Consensus forecasts prior to the announcement were calling for roughly 9% OP growth vs. the company's results, so this clearly took everyone by surprise. Even we were quite surprised by the extent of the forecast decline even though we have been warning of the potential of a cyclical top since the middle of last year. The stock initially opened down 13.5% on Friday…</p>

Fanuc Corp (6954 JP) shocked markets last Thursday by forecasting a 34% drop in OP, together with somewhat underwhelming results. Consensus forecasts prior to the announcement were calling for roughly 9% OP growth vs. the company's results, so this clearly took everyone by surprise. Even we were quite surprised by the extent of the forecast decline even though we have been warning of the potential of a cyclical top since the middle of last year. The stock initially opened down 13.5% on Friday…

Factory Automation Earnings: Is the Fanuc Shock for Real?

<p>Following middling earnings yesterday Yaskawa started the day up 2.2% but has since dropped and is now down 1.5% in an up market. Our initial impressions of earnings were not overly negative though we did feel that consensus expectations remained too high. There was a relatively bullish <a href="https://asia.nikkei.com/Business/Companies/Yaskawa-foresees-strong-profits-amid-China-s-electric-car-boom" target="_blank">Nikkei article</a> this morning noting that the company is generally conservative with guidance so its strong growth outlook (despite still being lower than consensus), share buyback and a reassessment of China names…</p>

Following middling earnings yesterday Yaskawa started the day up 2.2% but has since dropped and is now down 1.5% in an up market. Our initial impressions of earnings were not overly negative though we did feel that consensus expectations remained too high. There was a relatively bullish Nikkei article this morning noting that the company is generally conservative with guidance so its strong growth outlook (despite still being lower than consensus), share buyback and a reassessment of China names…

Yaskawa: Robotics Keeps Chugging but There Are Troubling Signs for Motion Control

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<h2>The Background</h2><p>The establishment of the <strong><a href="http://www.jpx.co.jp/english/equities/listing/cg/tvdivq0000008jdy-att/20150513.pdf" target="_blank">Japan Corporate Governance Code</a></strong> in 2015 was a beginning step to better governance at stodgy Japanese corporations where boards have often been composed largely of insiders and their friends, financial acuity or expertise of board members was sorely lacking, and treatment of minority shareholders has often been dodgy at best. The Japan Corporate Governance Code ("JCGC") which sets rules regarding whistle-blowing, disclosure, stakeholders’ rights and more, is…</p>

The BackgroundThe establishment of the Japan Corporate Governance Code in 2015 was a beginning step to better governance at stodgy Japanese corporations where boards have often been composed largely of insiders and their friends, financial acuity or expertise of board members was sorely lacking, and treatment of minority shareholders has often been dodgy at best. The Japan Corporate Governance Code ("JCGC") which sets rules regarding whistle-blowing, disclosure, stakeholders’ rights and more, is…

Japan Crossholdings: Japan Exchange's Sale of SGX Shares Sets A Precedent - Watch Closely

Japan

FANUC CORPORATION manufactures factory automation (FA) systems and equipments, and robots. The Company's products include computerized numerically-controlled (CNC) equipment, servo motors, laser systems, industrial robots, wire-cut electric discharge machines, and CNC drill.  Fanuc participates in a joint venture with General Electric in the FA field.

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Fanuc Corp Unsp Adr (FANUY US)

Hyundai Heavy Industries Holdings - Update on Its Implied Valuation

We have a positive view on Hyundai Heavy Industries Holdings (267250 KS) (HHIH). Our sum-of-the-parts analysis suggests a base case implied value...

Douglas Kim

Observations from Three Weeks Marketing Japanese Equities in the US

It is widely observed that the Japanese stock market performs poorly in calendar 1Q and seems to do okay for the rest of the year. With that in...

Pelham Smithers Associates

Factory Automation Earnings: Is the Fanuc Shock for Real?

Fanuc Corp (6954 JP) shocked markets last Thursday by forecasting a 34% drop in OP, together with somewhat underwhelming results. Consensus...

Mio Kato

Yaskawa: Robotics Keeps Chugging but There Are Troubling Signs for Motion Control

Following middling earnings yesterday Yaskawa started the day up 2.2% but has since dropped and is now down 1.5% in an up market. Our initial...

Mio Kato

Japan Crossholdings: Japan Exchange's Sale of SGX Shares Sets A Precedent - Watch Closely

The BackgroundThe establishment of the Japan Corporate Governance Code in 2015 was a beginning step to better governance at stodgy Japanese...

Travis Lundy

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