Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

Equity Analyst

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.

Event-Driven

The Japanese cloud-based SaaS provider <a href="https://www.smartkarma.com/entities/money-forward-inc" target="_blank" data-smartkarma-citation="entities:25919:1" rel="noopener">Money Forward (3994 JP)</a>  has announced an international offering of 5m shares on 02nd July 2021. The new share issue will account for approx. 9.4% of the extended share capital (post follow-on offering) of Money Forward (MF) and the company’s shares closed at JPY6,370 per share on the day of the announcement (from JPY6,370 per share at the end of Friday’s close). At the above price, Money Forward will raise about JPY31.85bn (US$291.5m). The offer price will be determined between 05th August to 10th August at a 0-10% discount.

The Japanese cloud-based SaaS provider Money Forward (3994 JP)  has announced an international offering of 5m shares on 02nd July 2021. The new share issue will account for approx. 9.4% of the extended share capital (post follow-on offering) of Money Forward (MF) and the company’s shares closed at JPY6,370 per share on the day of the announcement (from JPY6,370 per share at the end of Friday’s close). At the above price, Money Forward will raise about JPY31.85bn (US$291.5m). The offer price will be determined between 05th August to 10th August at a 0-10% discount. 

Money Forward Follow-On: Burning Cash to Grow Users to Reach Profits; Limited Upside

Japan Specialist

Mark Chadwick

Equity Bottom-Up

<div><ul>
<li>
Money Forward has announced a New Share Offering to international investors.  
</li>
<li>The company will raise approximately ¥31 billion assuming a 3% discount to today's close. </li>
<li>
The proceeds will be used for customer acquisition/SG&amp;A and M&amp;A. 
</li>
<li>The share offering sets the company up for further rapid expansion over the next 3 years. </li>
</ul></div>



Money Forward has announced a New Share Offering to international investors.  

The company will raise approximately ¥31 billion assuming a 3% discount to today's close. 

The proceeds will be used for customer acquisition/SG&amp;A and M&amp;A. 

The share offering sets the company up for further rapid expansion over the next 3 years. 


Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

In this insight, we take a look at the monthly performance of the trading opportunities surrounding TOPIX Index Rebalance events. During the month, we witnessed the Inclusion Events of cloud-based business accounting software company <a href="https://www.smartkarma.com/entities/money-forward-inc" target="_blank" data-smartkarma-citation="entities:25919:1" rel="noopener">Money Forward (3994 JP)</a>, water treatment technology company <a href="https://www.smartkarma.com/entities/nomura-micro-science-co-ltd" target="_blank" data-smartkarma-citation="entities:11317:1" rel="noopener">Nomura Micro Science (6254 JP)</a>, and printed circuit board manufacturer <a href="https://www.smartkarma.com/entities/meiko-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:20004:1" rel="noopener">Meiko Electronics (6787 JP)</a>. Furthermore, as 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/july-topix-ffw-rebalancing-trade" target="_blank" data-smartkarma-citation="insights:54275" rel="noopener">July TOPIX FFW Rebalancing Trade</a>, there were quarterly float adjustments for some constituents of the TOPIX Index which opened up a few trading opportunities. Below is a closer look at each of these situations.

In this insight, we take a look at the monthly performance of the trading opportunities surrounding TOPIX Index Rebalance events. During the month, we witnessed the Inclusion Events of cloud-based business accounting software company Money Forward (3994 JP), water treatment technology company Nomura Micro Science (6254 JP), and printed circuit board manufacturer Meiko Electronics (6787 JP). Furthermore, as discussed by Travis Lundy in July TOPIX FFW Rebalancing Trade, there were quarterly float adjustments for some constituents of the TOPIX Index which opened up a few trading opportunities. Below is a closer look at each of these situations. 

Cloud-based business accounting software company <a href="https://www.smartkarma.com/entities/money-forward-inc" target="_blank" data-smartkarma-citation="entities:25919:1" rel="noopener">Money Forward (3994 JP)</a>  <a href="https://s3-ap-northeast-1.amazonaws.com/mf-wp/wp-content/uploads/20210607153424/Notice-Regarding-Approval-of-Stock-Market-Listing-Transfer-to-the-First-Section-of-the-Tokyo-Stock-Exchange.pdf" target="_blank" rel="noopener">announced</a> on 7th June 2021 that they had received approval to move from the Mothers Section to the First Section of the Tokyo Stock Exchange which triggers inclusion into the TOPIX Index. Previously, this situation was covered in <a href="https://www.smartkarma.com/insights/topix-inclusion-money-forward-3994-jp" target="_blank" data-smartkarma-citation="insights:52690" rel="noopener">TOPIX Inclusion: Money Forward (3994 JP)</a>. On 15th July 2021, <a href="https://www.smartkarma.com/entities/money-forward-inc" target="_blank" data-smartkarma-citation="entities:25919:1" rel="noopener">Money Forward (3994 JP)</a> announced earnings for the quarter ending May 2021. Below is a closer look at how the stock has traded since the TSE1 promotion was announced and the upside potential for the remainder of the event timeline.

Cloud-based business accounting software company Money Forward (3994 JP)  announced on 7th June 2021 that they had received approval to move from the Mothers Section to the First Section of the Tokyo Stock Exchange which triggers inclusion into the TOPIX Index. Previously, this situation was covered in TOPIX Inclusion: Money Forward (3994 JP). On 15th July 2021, Money Forward (3994 JP) announced earnings for the quarter ending May 2021. Below is a closer look at how the stock has traded since the TSE1 promotion was announced and the upside potential for the remainder of the event timeline. 

TOPIX Inclusion: Money Forward (3994) Could Outperform Freee (4478) Until End of Month

<a href="https://www.smartkarma.com/entities/money-forward-inc" target="_blank" data-smartkarma-citation="entities:25919:1" rel="noopener">Money Forward (3994 JP)</a>  has not experienced any slowdown in customer acquisition or revenue growth due to the COVID pandemic, unlike many Japanese SaaS providers. It is a testament to the company's strong business model and go-to-market strategy. As a result, consolidated sales in Q2 rose 42% year over year to ¥3.99 billion. Although the stock has done well, rising 40% year to date, it remains cheap when compared with its Japanese peer, <a href="https://www.smartkarma.com/entities/freee-kk" target="_blank" data-smartkarma-citation="entities:28424:1" rel="noopener">freee (4478 JP)</a> .

Money Forward (3994 JP)  has not experienced any slowdown in customer acquisition or revenue growth due to the COVID pandemic, unlike many Japanese SaaS providers. It is a testament to the company's strong business model and go-to-market strategy. As a result, consolidated sales in Q2 rose 42% year over year to ¥3.99 billion. Although the stock has done well, rising 40% year to date, it remains cheap when compared with its Japanese peer, freee (4478 JP) .

Japan

freee K.K. develops software products. The Company produces cloud based accounting softwares, automatic online accounting systems, and other products. freee provides its services throughout Japan.

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Freee (4478 JP)

Money Forward Follow-On: Burning Cash to Grow Users to Reach Profits; Limited Upside

MF’s stock price is under pressure following its index inclusion and we believe there will be limited upside to MF’s current share price even at a...

Shifara Samsudeen, FCMA, CGMA

Money Forward (3994) | It's a Big Deal

New share offering is aggressive - ¥31b is around three times Annual Recurring Revenue. Still, it is just a 10% share dilution and is well liked by...

Mark Chadwick

TOPIX Inclusion Trade Summary: July 2021

In this insight, we discuss the performance of trading opportunities surrounding TOPIX Index Rebalance events. In July, Money Forward, Nomura...

Janaghan Jeyakumar, CFA

TOPIX Inclusion: Money Forward (3994) Could Outperform Freee (4478) Until End of Month

Money Forward shares are yet to outperform local rival freee with just 9 more trading days for the TOPIX Inclusion Event. The timing could be great...

Janaghan Jeyakumar, CFA

Money Forward (3994) | Evolving Rapidly

Money Forward (3994 JP) has not experienced any slowdown in customer acquisition or revenue growth due to the COVID pandemic, unlike many Japanese...

Mark Chadwick

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