Japanese Turnaround Situations, Short-Ideas, Azabu Research

Michael Allen

Japanese Turnaround Situations, Short-Ideas

Azabu Research

Azabu Research is a publishing and consulting firm focused on distressed equities in the Japanese market. We specialize in turnaround strategies, corporate combinations, divestitures, and restructuring.

Publisher of the Tokyo Turnaround Letter, which conducts the most thorough research possible of publicly available information, including forensic tests for fraudulent overstatement of assets and understatement of liabilities, as well as rigorous market and industry analysis to assess the underlying strengths of the company’s products or services, the appropriateness of the company’s turnaround strategy, and the skill of its current management team. The average length of a report exceeds 25 pages of text and tables, excluding any disclosures or executive summaries.

We have more than 30 years of experience in applying this process to distressed equities in Japan. Additionally, subscribers have free access to detailed, yet easily navigated earnings models for the target company as well as the top five comparable companies, and unlimited access to the analyst for follow-up questions.

Azabu Research also conducts be-spoke research on a project basis, and provides consulting services to companies looking to restructure, divest, make acquisitions, go public, or improve investor sentiment toward their stock.

Independent Research and Consulting Firm

Equity Bottom-Up

<ul>
<li>Capacity utilization at Sumco's largest customer, TSMC, jumped 10% in Q2, with another core customer, Renesas, showing consecutive improvements.</li>
<li>Surging AI chip demand and geopolitical shifts favoring non-Chinese suppliers are set to boost demand for high-end silicon wafers.</li>
<li>The stock trades at 0.7x book and 4.9x EV/EBITDA. These are levels we think the stock can make a meaningful upward advance from if the improvement in customer inventories broadens.</li>
</ul>


Capacity utilization at Sumco's largest customer, TSMC, jumped 10% in Q2, with another core customer, Renesas, showing consecutive improvements.
Surging AI chip demand and geopolitical shifts favoring non-Chinese suppliers are set to boost demand for high-end silicon wafers.
The stock trades at 0.7x book and 4.9x EV/EBITDA. These are levels we think the stock can make a meaningful upward advance from if the improvement in customer inventories broadens.


APAC IPOs & Placements, Aequitas Research

Akshat Shah

APAC 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.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/wistron-corp" target="_blank" data-smartkarma-citation="entities:2189:1" rel="noopener">Wistron Corp (3231 TT)</a> is looking to raise up to US$922m in its global depository receipts (GDRs) offering.</li>
<li>Similar to previous GDR listings, the firm has undergone a long drawn out process prior to launching the deal, having to jump through a number of board/shareholder/regulatory approval loops.</li>
<li>In this note, we run the deal through our ECM framework and comment on deal dynamics.</li>
</ul>



Wistron Corp (3231 TT) is looking to raise up to US$922m in its global depository receipts (GDRs) offering.
Similar to previous GDR listings, the firm has undergone a long drawn out process prior to launching the deal, having to jump through a number of board/shareholder/regulatory approval loops.
In this note, we run the deal through our ECM framework and comment on deal dynamics.


Wistron GDR Offering - Well Flagged US$922m Offering, Discount Slightly Wider than Recent Deals

Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

TSMC (Taiwan Semiconductor Manufacturing) - ADR / Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing) - ADR

<ul>
<li>Google’s Pixel Chips to Go All-In on TSMC After Using Samsung Foundry Previously</li>
<li>TSMC (2330.TT; TSM.US): TSMC Provides Updates at 2025 Technology Symposium in Hsinchu Today. </li>
<li>GlobalWafers (6488.TT): Shareholders’ Meeting Held; US Tariff Effects Pending; SiC Chances Ahead. </li>
</ul>


Google’s Pixel Chips to Go All-In on TSMC After Using Samsung Foundry Previously
TSMC (2330.TT; TSM.US): TSMC Provides Updates at 2025 Technology Symposium in Hsinchu Today. 
GlobalWafers (6488.TT): Shareholders’ Meeting Held; US Tariff Effects Pending; SiC Chances Ahead. 


Taiwan Tech Weekly: Google's Pixel Going All-In on TSMC; TSMC 2025 Symposium Key Take-Aways

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

Yang Ming Marine Transport / Index Rebalance

<ul>
<li>There are 10 changes for the TIP Taiwan Value High Dividend Index in May. The Yuanta Taiwan Value High Dividend ETF (00940 TT) has an AUM of US$4.4bn.</li>
<li>Estimated one-way turnover is 25.2% and there are 12 stocks with over 4 days of ADV to trade. The rebalance commenced yesterday and will end on Friday.</li>
<li>An equal weighted basket of inclusions has outperformed an equal weighted basket of deletions over the last month. That could continue near-term as the ETF continues to rebalance their portfolio.</li>
</ul>


There are 10 changes for the TIP Taiwan Value High Dividend Index in May. The Yuanta Taiwan Value High Dividend ETF (00940 TT) has an AUM of US$4.4bn.
Estimated one-way turnover is 25.2% and there are 12 stocks with over 4 days of ADV to trade. The rebalance commenced yesterday and will end on Friday.
An equal weighted basket of inclusions has outperformed an equal weighted basket of deletions over the last month. That could continue near-term as the ETF continues to rebalance their portfolio.


TIP Taiwan Value High Dividend Index Rebalance: 10 Changes Implemented This Week; US$2.2bn Trade

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Event-Driven

<ul>
<li>In this insight, we discuss about SK Inc (034730 KS) which is considering on selling the controlling stake of SK Siltron.</li>
<li>If SK is successful in selling 70.6% stake in SK Siltron for about 5 trillion won, it could result in more than 3 trillion won cash inflow for SK Inc. </li>
<li>Our base case valuation of SK Inc is NAV of 13.9 trillion won (NAV per share of 192,217 won), representing a 61% upside from current levels.</li>
</ul>


In this insight, we discuss about SK Inc (034730 KS) which is considering on selling the controlling stake of SK Siltron.
If SK is successful in selling 70.6% stake in SK Siltron for about 5 trillion won, it could result in more than 3 trillion won cash inflow for SK Inc. 
Our base case valuation of SK Inc is NAV of 13.9 trillion won (NAV per share of 192,217 won), representing a 61% upside from current levels.


Potential Sale of a Controlling Stake in SK Siltron to Hahn & Co

Taiwan

Globalwafers Co., Ltd. specializes in silicon wafer manufacturing and also provides solar wafers and crystal rods. The Company possesses a complete production line from ingot growth, slicing, etching, diffusion, polishing to epitaxy. Their products include Epi wafers, polished wafers, etched wafers, ultra thin wafers and deep diffusion wafers.

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Globalwafers (6488 TT)

Sumco (3436): So, This Is How Slumps Die

Unprecidented growth in customer inventory is what started Sumco's slump, but now customers are reporting increased capacity utilization, driven by...

Michael Allen

Wistron GDR Offering - Well Flagged US$922m Offering, Discount Slightly Wider than Recent Deals

Wistron Corporation (Wistron) is looking to raise up to US$922m in its global depository receipts (GDRs) offering. In this note, we run the deal...

Akshat Shah

Taiwan Tech Weekly: Google's Pixel Going All-In on TSMC; TSMC 2025 Symposium Key Take-Aways

Google is switching to TSMC for its Pixel chips, TSMC provides updates at technology symposium, GlobalWafers shareholders meeting held with US...

Vincent Fernando, CFA

TIP Taiwan Value High Dividend Index Rebalance: 10 Changes Implemented This Week; US$2.2bn Trade

There are 10 index changes in May. Estimated one-way turnover is 25.2% and trade is US$2.2bn. 12 stocks with over 4x ADV to trade. Multiple stocks...

Brian Freitas

Potential Sale of a Controlling Stake in SK Siltron to Hahn & Co

If SK is successful in selling 70.6% stake in SK Siltron for about 5 trillion won, it could result in more than 3 trillion won cash inflow for SK Inc.

Douglas Kim

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Sumco (3436): So, This Is How Slumps Die

Unprecidented growth in customer inventory is what started Sumco's slump, but now customers are reporting increased capacity utilization, driven by...

Michael Allen

Wistron GDR Offering - Well Flagged US$922m Offering, Discount Slightly Wider than Recent Deals

Wistron Corporation (Wistron) is looking to raise up to US$922m in its global depository receipts (GDRs) offering. In this note, we run the deal...

Akshat Shah

Taiwan Tech Weekly: Google's Pixel Going All-In on TSMC; TSMC 2025 Symposium Key Take-Aways

​Google is switching to TSMC for its Pixel chips, TSMC provides updates at technology symposium, GlobalWafers shareholders meeting held with US...

Vincent Fernando, CFA

TIP Taiwan Value High Dividend Index Rebalance: 10 Changes Implemented This Week; US$2.2bn Trade

There are 10 index changes in May. Estimated one-way turnover is 25.2% and trade is US$2.2bn. 12 stocks with over 4x ADV to trade. Multiple stocks...

Brian Freitas

Potential Sale of a Controlling Stake in SK Siltron to Hahn & Co

If SK is successful in selling 70.6% stake in SK Siltron for about 5 trillion won, it could result in more than 3 trillion won cash inflow for SK Inc.

Douglas Kim

Google is switching to TSMC for its Pixel chips, TSMC provides updates at technology symposium, GlobalWafers shareholders meeting held with US...