Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<a href="https://www.smartkarma.com/entities/j-trust-co-ltd" target="_blank" data-smartkarma-citation="entities:20246:1" rel="noopener">J Trust Co Ltd (8508 JP)</a> made waves in the past week, <a href="https://disclosure.edinet-fsa.go.jp/E01EW/download?uji.verb=W0EZA104CXP001003Action&amp;uji.bean=ee.bean.parent.EECommonSearchBean&amp;PID=W1E63011&amp;SESSIONKEY=1622421759294&amp;lgKbn=2&amp;pkbn=0&amp;skbn=1&amp;dskb=&amp;askb=&amp;dflg=0&amp;iflg=&amp;preId=1&amp;mul=8699&amp;lpr=on&amp;cal=1&amp;era=R&amp;yer=&amp;mon=&amp;pfs=4&amp;row=100&amp;idx=0&amp;str=&amp;kbn=1&amp;flg=&amp;syoruiKanriNo=&amp;s=S100LDOU" target="_blank" rel="noopener">announcing</a> on the 24th it had bought 5.09% of <a href="https://www.smartkarma.com/entities/sawada-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:7311:1" rel="noopener">Sawada Holdings (8699 JP)</a>, <a href="https://disclosure.edinet-fsa.go.jp/E01EW/download?uji.verb=W0EZA104CXP001003Action&amp;uji.bean=ee.bean.parent.EECommonSearchBean&amp;PID=W1E63011&amp;SESSIONKEY=1622421759294&amp;lgKbn=2&amp;pkbn=0&amp;skbn=1&amp;dskb=&amp;askb=&amp;dflg=0&amp;iflg=&amp;preId=1&amp;mul=8699&amp;lpr=on&amp;cal=1&amp;era=R&amp;yer=&amp;mon=&amp;pfs=4&amp;row=100&amp;idx=0&amp;str=&amp;kbn=1&amp;flg=&amp;syoruiKanriNo=&amp;s=S100LE2B" target="_blank" rel="noopener">announcing</a> on the 26th it had reached 6.12%, and <a href="https://disclosure.edinet-fsa.go.jp/E01EW/download?uji.verb=W0EZA104CXP001003Action&amp;uji.bean=ee.bean.parent.EECommonSearchBean&amp;PID=W1E63011&amp;SESSIONKEY=1622421759294&amp;lgKbn=2&amp;pkbn=0&amp;skbn=1&amp;dskb=&amp;askb=&amp;dflg=0&amp;iflg=&amp;preId=1&amp;mul=8699&amp;lpr=on&amp;cal=1&amp;era=R&amp;yer=&amp;mon=&amp;pfs=4&amp;row=100&amp;idx=0&amp;str=&amp;kbn=1&amp;flg=&amp;syoruiKanriNo=&amp;s=S100LEXW" target="_blank" rel="noopener">announcing</a> on Friday 28 May after the close that it had reached 9.0% with 3.685mm shares (full length urls below in appendix).The shares rallied hard, from ¥940 to ¥1,050+ which was above the Tender Offer Price offered by Meta Capital/Upsilon Investment Partners. What J Trust has told the world in its filings about how and when it bought, and about its reasons for investment may tell you something about what to expect going forward. The possibility of J Trust launching a Tender Offer exists but there are LOTS of hurdles between now and then. More below the fold.

J Trust Co Ltd (8508 JP) made waves in the past week, announcing on the 24th it had bought 5.09% of Sawada Holdings (8699 JP), announcing on the 26th it had reached 6.12%, and announcing on Friday 28 May after the close that it had reached 9.0% with 3.685mm shares (full length urls below in appendix).The shares rallied hard, from ¥940 to ¥1,050+ which was above the Tender Offer Price offered by Meta Capital/Upsilon Investment Partners. What J Trust has told the world in its filings about how and when it bought, and about its reasons for investment may tell you something about what to expect going forward. The possibility of J Trust launching a Tender Offer exists but there are LOTS of hurdles between now and then. More below the fold. 

Be Careful of Expectations on Sawada (8699)

Silver Point

Thomas J. Monaco

Independent Insight Provider

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Equity Bottom-Up

* Domestic Japanese lending business has new customer acquisition tracking above target, reflecting positive changes in the current environment for unsecured loans. The absolute JPY balance increases at Aiful (8515.JP) remains the highest within the consumer finance industry. * Aiful’s Thai business will be profitable by FY 3/19 and is expected to represent 7% of consolidated profits by FY 3/20.  Further, media reports suggest that Aiful is considering listing its Thai subsidiary. * The drawdown…

* Domestic Japanese lending business has new customer acquisition tracking above target, reflecting positive changes in the current environment for unsecured loans. The absolute JPY balance increases at Aiful (8515.JP) remains the highest within the consumer finance industry. * Aiful’s Thai business will be profitable by FY 3/19 and is expected to represent 7% of consolidated profits by FY 3/20.  Further, media reports suggest that Aiful is considering listing its Thai subsidiary. * The drawdown…

* Problems at Group Lease (GL.TB) became more apparent with Ernst &amp; Young’s scathing 2016 audit report which questioned the integrity of inter-company loans, more liberal accounting policies, and the 30% purchase of a Sri Lankan company from a related party at a 120% market premium.* Among other items, an independent research report further alleged that Group Lease purposely misled investors, Ernst &amp; Young, and the Stock Exchange of Thailand (SET). Our own research suggests that each…

* Problems at Group Lease (GL.TB) became more apparent with Ernst &amp; Young’s scathing 2016 audit report which questioned the integrity of inter-company loans, more liberal accounting policies, and the 30% purchase of a Sri Lankan company from a related party at a 120% market premium.* Among other items, an independent research report further alleged that Group Lease purposely misled investors, Ernst &amp; Young, and the Stock Exchange of Thailand (SET). Our own research suggests that each…

Asean-focused. Ex-Head of Thai Research

Athaporn Arayasantiparb, CFA

Thematic (Sector/Industry)

Recently, MCorp Review listened to a talk by E8 Consulting on open source and its applications in building fintech platforms and developing investing strategies and found it quite interesting. Firstly, they defined open source and explained why it was so useful. Typically, open source is free and bound by certain license terms; it allows various users to change the source code and develop commercial applications for it. Probably, the best example of this is how Bloomberg terminals, a highly…

Recently, MCorp Review listened to a talk by E8 Consulting on open source and its applications in building fintech platforms and developing investing strategies and found it quite interesting. Firstly, they defined open source and explained why it was so useful. Typically, open source is free and bound by certain license terms; it allows various users to change the source code and develop commercial applications for it. Probably, the best example of this is how Bloomberg terminals, a highly…

Over the past 20 years, Thailand faced two financial crisis, namely Tom Yum Goong in 1997 and Lehman in 2008. Discounting the political nonsense that is just part of life down here, we think there are five important lessons to take away, regarding: 1) the importance of investors; 2) liabilities-cash flow matching; 3) sticking to core competencies as well as avoiding : 4) currency pegs to dollars (or any currency); and 5) capital controls. No event in Thai business history has transformed the landscape more than the 1997 crisis. In this review, we highlight a few anecdotes of those who survived and those who didn't (at least not in their original forms).

Over the past 20 years, Thailand faced two financial crisis, namely Tom Yum Goong in 1997 and Lehman in 2008. Discounting the political nonsense that is just part of life down here, we think there are five important lessons to take away, regarding: 1) the importance of investors; 2) liabilities-cash flow matching; 3) sticking to core competencies as well as avoiding : 4) currency pegs to dollars (or any currency); and 5) capital controls. No event in Thai business history has transformed the landscape more than the 1997 crisis. In this review, we highlight a few anecdotes of those who survived and those who didn't (at least not in their original forms).

Five Biggest Lessons from Thai Financial Crisis

Thailand

Group Lease Public Company Limited provides motorcycle hire purchase in Bangkok, asset financing and personal loan.  The company also provides related services such as registration and insurance services.

Group Lease Public (GL TB)

Be Careful of Expectations on Sawada (8699)

J Trust has gone to 9% on Sawada. J Trust has a history in EM Asian financial assets. It even has a small business in Mongolia. But JT being a new...

Travis Lundy

Aiful – Sawasdee Ka

* Domestic Japanese lending business has new customer acquisition tracking above target, reflecting positive changes in the current environment for...

Thomas J. Monaco

Group Lease - Lessons from Icharus

* Problems at Group Lease (GL.TB) became more apparent with Ernst & Young’s scathing 2016 audit report which questioned the integrity of...

Thomas J. Monaco

EB on Open Source & Investing

Recently, MCorp Review listened to a talk by E8 Consulting on open source and its applications in building fintech platforms and developing...

Athaporn Arayasantiparb, CFA

Five Biggest Lessons from Thai Financial Crisis

Over the past 20 years, Thailand faced two financial crisis, namely Tom Yum Goong in 1997 and Lehman in 2008. Discounting the political nonsense...

Athaporn Arayasantiparb, CFA