Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

On 25th February, Japanese advertising company <a href="https://www.smartkarma.com/entities/hakuhodo-dy-holdings-inc" target="_blank" data-smartkarma-citation="entities:8736:1" rel="noopener">Hakuhodo Dy Holdings (2433 JP)</a><a href="https://ssl4.eir-parts.net/doc/2433/tdnet/1801424/00.pdf" target="_blank" rel="noopener">announced</a> a Tender Offer to acquire 78.1% of Taiwanese peer <a href="https://www.smartkarma.com/entities/growww-media-co-ltd" target="_blank" data-smartkarma-citation="entities:28876:1" rel="noopener">Growww Media (8497 TT)</a> for NT$1,853mn.The Offer has a 50% minimum acceptance condition. However, Target shareholders accounting for more than 50% of total shares have already agreed to tender their shares.Furthermore, the Deal requires approval of the Investment Commission of the Taiwan Ministry of Economic Affairs and is expected to close by 15th April 2020. However, in case the approval gets delayed, the Acquirer can extend the Offer Period by a maximum of 50 days. The Offer Price is NT$69.00/share and the consideration will be in the form of cash.<a href="https://www.smartkarma.com/entities/growww-media-co-ltd" target="_blank" data-smartkarma-citation="entities:28876:1" rel="noopener">Growww Media (8497 TT)</a>'s shares are currently at NT$67.90. With around two months left to completion, below we take a look at the fairness of the Offer, approval process of the Taiwan Ministry of Economic Affairs, and the consequent squeeze-out procedure.

On 25th February, Japanese advertising company Hakuhodo Dy Holdings (2433 JP)announced a Tender Offer to acquire 78.1% of Taiwanese peer Growww Media (8497 TT) for NT$1,853mn.The Offer has a 50% minimum acceptance condition. However, Target shareholders accounting for more than 50% of total shares have already agreed to tender their shares.Furthermore, the Deal requires approval of the Investment Commission of the Taiwan Ministry of Economic Affairs and is expected to close by 15th April 2020. However, in case the approval gets delayed, the Acquirer can extend the Offer Period by a maximum of 50 days. The Offer Price is NT$69.00/share and the consideration will be in the form of cash.Growww Media (8497 TT)'s shares are currently at NT$67.90. With around two months left to completion, below we take a look at the fairness of the Offer, approval process of the Taiwan Ministry of Economic Affairs, and the consequent squeeze-out procedure. 

Taiwan's GROWWW Media to Be Acquired by Hakuhodo (2433 JP)

'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

ja research

ja research is an independent research platform focused exclusively on Japanese equities. Leveraging data and graphic analysis provided by Japan Analytics, we provide insights on small and medium-sized companies that have been ignored by the sell-side as well as challenging conventional wisdom on larger companies. We also offer analyst and corporate access, the latter with translation if required. 

Thematic (Sector/Industry)

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/117/227/original/2020-02-11_05-05-13.png?1581376613" class="editor-image img-responsive" data-smartkarma-image-id="117227"></figure><div class="content-caption">Source • Japan Analytics</div>10TH FEBRUARY ROUNDUP - 189 results and 93 revision announcements had little impact on our aggregate Scores, although decliners still outweighed improvers by a factor of two times. Amongst larger caps, <a href="https://www.smartkarma.com/entities/mitsubishi-estate-co-ltd" target="_blank" data-smartkarma-citation="entities:566:1" rel="noopener">Mitsubishi Estate (8802 JP)</a> produced the best quarter-on-quarter change in Score, with <a href="https://www.smartkarma.com/entities/sundrug-co-ltd" target="_blank" data-smartkarma-citation="entities:12615:1" rel="noopener">Sundrug (9989 JP)</a> being one of the worst. Today is a public holiday (kenkoku kinen no hi), and so the next roundup will appear on Wednesday morning. <hr>• SECTOR TIMELINE •<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/117/228/original/2020-02-11_05-08-14.png?1581377317" class="editor-image img-responsive" data-smartkarma-image-id="117228"></figure><div class="content-caption">Source • Japan Analytics</div>SECTOR TIMELINE - Monday's main moves were upwards for Real Estate and Media (<a href="https://www.smartkarma.com/entities/hakuhodo-dy-holdings-inc" target="_blank" data-smartkarma-citation="entities:8736:1" rel="noopener">Hakuhodo DY (2433 JP)</a>) and downwards (again) for Other Commercial Products (<a href="https://www.smartkarma.com/entities/hamamatsu-photonics-kk" target="_blank" data-smartkarma-citation="entities:14074:1" rel="noopener">Hamamatsu Photonics (6965 JP)</a>) and Building Materials (<a href="https://www.smartkarma.com/entities/nichias-corp" target="_blank" data-smartkarma-citation="entities:14674:1" rel="noopener">Nichias (5393 JP)</a>).

Source • Japan Analytics10TH FEBRUARY ROUNDUP - 189 results and 93 revision announcements had little impact on our aggregate Scores, although decliners still outweighed improvers by a factor of two times. Amongst larger caps, Mitsubishi Estate (8802 JP) produced the best quarter-on-quarter change in Score, with Sundrug (9989 JP) being one of the worst. Today is a public holiday (kenkoku kinen no hi), and so the next roundup will appear on Wednesday morning. • SECTOR TIMELINE •Source • Japan AnalyticsSECTOR TIMELINE - Monday's main moves were upwards for Real Estate and Media (Hakuhodo DY (2433 JP)) and downwards (again) for Other Commercial Products (Hamamatsu Photonics (6965 JP)) and Building Materials (Nichias (5393 JP)). 

🇯🇵 JAPAN • Results & Revisions Daily Roundup - 10th February ▲7003 8802 2433 ▼6965 9989 6324

Equity Analyst, LightStream Research

Supun Walpola

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.

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/cyberagent-inc" target="_blank" data-smartkarma-citation="entities:8197:1" rel="noopener">Cyberagent Inc (4751 JP)</a> reported its FY09/19 full-year financial results last week. Consolidated revenue and OP were ¥454 (+8.1% YoY) and ¥31bn (+2.2% YoY) respectively for FY09/19.  Cyberagent's OP beat consensus by 3.7%, mainly due to a surprise reduction in losses from AbemaTV and lower advertisement spend in the Game business, but revenue fell below consensus by 0.6%. Both revenue and OP were on par with our estimates (see our previous note: <a href="https://www.smartkarma.com/insights/cyberagent-revises-the-op-guidance-upwards-by-5-share-price-up-14" target="_blank" data-smartkarma-citation="insights:31374" rel="noopener">CyberAgent Revises the OP Guidance Upwards by 5%; Share Price Up 14%</a>). </li>
<li>The market reaction for the results was mostly negative as Cyberagent's share price was down 14% last week (closing at ¥3,455 on Friday) since the release of the results. We believe this negative reaction would have been sparked by rather mediocre results of Internet Advertisement and Game businesses coupled with scepticism over whether AbemaTV could deliver its promised results. However, despite these concerns, we still remain bullish on the stock.</li>
</ul>



Cyberagent Inc (4751 JP) reported its FY09/19 full-year financial results last week. Consolidated revenue and OP were ¥454 (+8.1% YoY) and ¥31bn (+2.2% YoY) respectively for FY09/19.  Cyberagent's OP beat consensus by 3.7%, mainly due to a surprise reduction in losses from AbemaTV and lower advertisement spend in the Game business, but revenue fell below consensus by 0.6%. Both revenue and OP were on par with our estimates (see our previous note: CyberAgent Revises the OP Guidance Upwards by 5%; Share Price Up 14%). 
The market reaction for the results was mostly negative as Cyberagent's share price was down 14% last week (closing at ¥3,455 on Friday) since the release of the results. We believe this negative reaction would have been sparked by rather mediocre results of Internet Advertisement and Game businesses coupled with scepticism over whether AbemaTV could deliver its promised results. However, despite these concerns, we still remain bullish on the stock.


Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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

Recruit Holdings / Equity Capital Markets

Recruit Holdings announced a USD 3.8 bn globlal follow-on offering on August 28th, selling up to 121.5 million shares. In our previous insight (link <a href="https://www.smartkarma.com/insights/recruit-holdings-placement-first-major-sell-down-since-2016" target="_blank" rel="noopener">here</a>), we briefly covered the details of the deal, rationale of the sell down, the selling shareholders, comparison to previous deals. 
In this insight, we will cover the company's recent performance, SOTP based valuation, past Japan placement with a deal size of more than USD 1 billion, index event, future sell-down, and score the deal in our ECM framework.
We have previously covered some of the past offerings:
<ul>
<li class="">USD 2.3 billion raising in September 2016 (<a href="https://www.smartkarma.com/insights/recruit-holdings-time-to-hire-more-long-term-shareholders" target="_blank" rel="noopener">link</a>)</li>
<li class="">USD 263 million raising in January 2019 (<a href="https://www.smartkarma.com/insights/recruit-holdings-placement-a-tiny-long-overdue-sell-down" target="_blank" rel="noopener">link</a>)</li>
</ul>

Recruit Holdings announced a USD 3.8 bn globlal follow-on offering on August 28th, selling up to 121.5 million shares. In our previous insight (link here), we briefly covered the details of the deal, rationale of the sell down, the selling shareholders, comparison to previous deals. 
In this insight, we will cover the company's recent performance, SOTP based valuation, past Japan placement with a deal size of more than USD 1 billion, index event, future sell-down, and score the deal in our ECM framework.
We have previously covered some of the past offerings:

USD 2.3 billion raising in September 2016 (link)
USD 263 million raising in January 2019 (link)


Recruit Holding Placement: Thoughts on Valuation, Past Placements, and Index Event

<a href="https://www.smartkarma.com/entities/cyberagent-inc" target="_blank" data-smartkarma-citation="entities:8197:1" rel="noopener">Cyberagent Inc (4751 JP)</a> reported 3Q FY09/19 financial results last week (on Wednesday, 24th July 2019). CyberAgent reported revenue of ¥113.6bn (+8.8% YoY) and OP of ¥9.4bn (+38.3% YoY) for 3Q FY09/19. Both revenue and OP beat consensus by 1.3% and 53.9% respectively. CyberAgent revised its full-year OP guidance upwards by ¥9bn (+4.5%) from ¥20bn to ¥29bn. CyberAgent's share price reacted positively for this, closing at ¥4,565 on Monday (29th July), up by 14% from last Tuesday's (23rd July) close.

Cyberagent Inc (4751 JP) reported 3Q FY09/19 financial results last week (on Wednesday, 24th July 2019). CyberAgent reported revenue of ¥113.6bn (+8.8% YoY) and OP of ¥9.4bn (+38.3% YoY) for 3Q FY09/19. Both revenue and OP beat consensus by 1.3% and 53.9% respectively. CyberAgent revised its full-year OP guidance upwards by ¥9bn (+4.5%) from ¥20bn to ¥29bn. CyberAgent's share price reacted positively for this, closing at ¥4,565 on Monday (29th July), up by 14% from last Tuesday's (23rd July) close.

CyberAgent Revises the OP Guidance Upwards by 5%; Share Price Up 14%

Japan

HAKUHODO DY HOLDINGS INCORPORATED is a holding company established through the merger of Hakuhodo Inc., Daiko Advertising Inc., and Yomiko Advertising Inc. The Company, through its subsidiaries, provides comprehensive advertising services.

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Hakuhodo Dy Holdings (2433 JP)

Taiwan's GROWWW Media to Be Acquired by Hakuhodo (2433 JP)

On 25th February, Japanese advertising company Hakuhodo Dy Holdings (2433 JP)announced a Tender Offer to acquire 78.1% of Taiwanese peer Growww...

Janaghan Jeyakumar, CFA

🇯🇵 JAPAN • Results & Revisions Daily Roundup - 10th February ▲7003 8802 2433 ▼6965 9989 6324

10TH FEBRUARY ROUNDUP - 189 results and 93 revision announcements had little impact on our aggregate Scores, although decliners still outweighed...

Campbell Gunn

CyberAgent (4751 JP): Buy the Dip?

Cyberagent Inc (4751 JP) reported its FY09/19 full-year financial results last week. Consolidated revenue and OP were ¥454 (+8.1% YoY) and ¥31bn...

Supun Walpola

Recruit Holding Placement: Thoughts on Valuation, Past Placements, and Index Event

Recruit Holdings announced a USD 3.8 bn globlal follow-on offering on August 28th, selling up to 121.5 million shares. In our previous insight...

Ke Yan, CFA, FRM

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Taiwan's GROWWW Media to Be Acquired by Hakuhodo (2433 JP)

On 25th February, Japanese advertising company Hakuhodo Dy Holdings (2433 JP)announced a Tender Offer to acquire 78.1% of Taiwanese peer Growww...

Janaghan Jeyakumar, CFA

🇯🇵 JAPAN • Results & Revisions Daily Roundup - 10th February ▲7003 8802 2433 ▼6965 9989 6324

10TH FEBRUARY ROUNDUP - 189 results and 93 revision announcements had little impact on our aggregate Scores, although decliners still outweighed...

Campbell Gunn

CyberAgent (4751 JP): Buy the Dip?

Cyberagent Inc (4751 JP) reported its FY09/19 full-year financial results last week. Consolidated revenue and OP were ¥454 (+8.1% YoY) and ¥31bn...

Supun Walpola

Recruit Holding Placement: Thoughts on Valuation, Past Placements, and Index Event

Recruit Holdings announced a USD 3.8 bn globlal follow-on offering on August 28th, selling up to 121.5 million shares. In our previous insight...

Ke Yan, CFA, FRM

CyberAgent Revises the OP Guidance Upwards by 5%; Share Price Up 14%

Cyberagent Inc (4751 JP) reported 3Q FY09/19 financial results last week (on Wednesday, 24th July 2019). CyberAgent reported revenue of ¥113.6bn...

Supun Walpola