Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>In March 2023, <a href="https://www.smartkarma.com/entities/japan-post-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:359:1" rel="noopener">Japan Post Holdings (6178 JP)</a> sold ¥1.1trln of shares in <a href="https://www.smartkarma.com/entities/japan-post-bank-co-ltd" target="_blank" data-smartkarma-citation="entities:838:1" rel="noopener">Japan Post Bank (7182 JP)</a>, lowering its stake considerably, raising float. <a href="https://www.smartkarma.com/insights/japan-post-bank-7182-the-october-topix-ffw-adjustment" target="_blank" rel="noopener">There will be a TOPIX upweight</a>. </li>
<li>In May, with earnings, they announced their <a href="https://www.japanpost.jp/en/ir/news/jpn/pdf/20230515_en04.pdf" target="_blank" rel="noopener">intention to buy back ¥300bn of shares</a> or up to 10% of shares out. Today, they <a href="https://www.japanpost.jp/en/ir/news/jpn/pdf/20230814_en01.pdf" target="_blank" rel="noopener">announced the details</a>. ¥300bn through March end.</li>
<li>In a ¥300bn ToSTNeT-3 tomorrow, the govt will sell back ¥105.7bn. That leaves a residual worth examining. So we examine.</li>
</ul>


In March 2023, Japan Post Holdings (6178 JP) sold ¥1.1trln of shares in Japan Post Bank (7182 JP), lowering its stake considerably, raising float. There will be a TOPIX upweight. 
In May, with earnings, they announced their intention to buy back ¥300bn of shares or up to 10% of shares out. Today, they announced the details. ¥300bn through March end.
In a ¥300bn ToSTNeT-3 tomorrow, the govt will sell back ¥105.7bn. That leaves a residual worth examining. So we examine.


Japan Post Holdings (6178) Starts Its Bigly Buyback With a Sale from the MOF-Boffins

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, 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.

<ul>
<li>With <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota (7203 JP)</a> having sold some of its stake in <a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso</a>, <a href="https://www.smartkarma.com/entities/kddi-corp" target="_blank" data-smartkarma-citation="entities:639:1" rel="noopener">KDDI</a> and <a href="https://www.smartkarma.com/entities/harmonic-drive-systems-inc" target="_blank" data-smartkarma-citation="entities:10238:1" rel="noopener">Harmonic Drive</a> this year, it has firmly set the ball rolling for unwinding some of its cross-shareholding.</li>
<li>Toyota has a shareholding in around 60 listed companies, with its combined disposable stake worth over US$26bn.</li>
<li>In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.</li>
</ul>


With Toyota (7203 JP) having sold some of its stake in Denso, KDDI and Harmonic Drive this year, it has firmly set the ball rolling for unwinding some of its cross-shareholding.
Toyota has a shareholding in around 60 listed companies, with its combined disposable stake worth over US$26bn.
In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.


Toyota Cross-Shareholding - To Say a Whole Lot Is Left Would Be a US$26bn Understatement

David Blennerhassett

<ul>
<li>
<a href="https://www.smartkarma.com/entities/rakuten-bank-ltd" target="_blank" data-smartkarma-citation="entities:35638:1" rel="noopener">Rakuten Bank (5838 JP)</a>'s TOPIX inclusion is this week. And the Real World Float has gotten smaller since the offering. And some of those people aren't going to sell near-term.</li>
<li>
<a href="https://www.smartkarma.com/entities/swire-pacific-ltd-cl-a" target="_blank" data-smartkarma-citation="entities:10433:1" rel="noopener">Swire Pacific (A) (19 HK)</a>'s P/B is back down to 0.31x as <a href="https://www.smartkarma.com/entities/cathay-pacific-airways-ltd" target="_blank" data-smartkarma-citation="entities:243:1" rel="noopener">Cathay Pacific Airways (293 HK)</a> tackles alleged language bias by flight attendants. </li>
<li>Understanding real money demand on the <a href="https://www.smartkarma.com/entities/rakuten-group-inc" target="_blank" data-smartkarma-citation="entities:31:1" rel="noopener">Rakuten (4755 JP)</a> story is key. If there is any, that makes deal overhang smaller than it looks. </li>
</ul>



Rakuten Bank (5838 JP)'s TOPIX inclusion is this week. And the Real World Float has gotten smaller since the offering. And some of those people aren't going to sell near-term.

Swire Pacific (A) (19 HK)'s P/B is back down to 0.31x as Cathay Pacific Airways (293 HK) tackles alleged language bias by flight attendants. 
Understanding real money demand on the Rakuten (4755 JP) story is key. If there is any, that makes deal overhang smaller than it looks. 


Last Week In Event SPACE: Rakuten Bank/Group, Cathay/Swire Pacific, Japan Post

<ul>
<li>At 0.3x, <a href="https://www.smartkarma.com/entities/japan-post-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:359:1" rel="noopener">Japan Post Holdings (6178 JP)</a> is top of the heap in terms of dollar "UpValue" to move to PBR 1.0x under Japan's governance changes. </li>
<li>Preceding my comments on Japan Post are the current setup/unwind tables for Asia-Pacific Holdcos. </li>
<li>These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.</li>
</ul>


At 0.3x, Japan Post Holdings (6178 JP) is top of the heap in terms of dollar "UpValue" to move to PBR 1.0x under Japan's governance changes. 
Preceding my comments on Japan Post are the current setup/unwind tables for Asia-Pacific Holdcos. 
These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.


StubWorld: Japan Post Holdings Coming Up "Cheap"

<ul>
<li>As per Reuters, <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota Motor (7203 JP)</a> could look to sell up to 10% of <a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso Corp (6902 JP)</a> to raise around US$4.7bn before the end of the year.</li>
<li>Toyota is the company’s largest shareholder and its largest customer.</li>
<li>In this note, we will talk about the deal dynamics.</li>
</ul>


As per Reuters, Toyota Motor (7203 JP) could look to sell up to 10% of Denso Corp (6902 JP) to raise around US$4.7bn before the end of the year.
Toyota is the company’s largest shareholder and its largest customer.
In this note, we will talk about the deal dynamics.


Denso Corp Placement - Possible Placement by Toyota to Raise US$4.7bn

Japan

Japan Post Holdings Co. Ltd. operates post stations, banks, and insurance business. The Company offers letters and goods transportation services, stamp sales, deposits, loans, and insurance products.

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Japan Post Holdings (6178 JP)

Japan Post Holdings (6178) Starts Its Bigly Buyback With a Sale from the MOF-Boffins

JPH (6178 JP) today announced they had bought back 126.428mm shares for ¥132.118bn in from 15-31 August. 103.1mm shs in the ToSTNeT-3, and 23.35mm...

Travis Lundy

Toyota Cross-Shareholding - To Say a Whole Lot Is Left Would Be a US$26bn Understatement

KDDI has just announced that it will conduct a buyback at JPY3,896/share in which Toyota Motors plans to tender 49.8m shares or just around 2.3% of...

Sumeet Singh

Last Week In Event SPACE: Rakuten Bank/Group, Cathay/Swire Pacific, Japan Post

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

StubWorld: Japan Post Holdings Coming Up "Cheap"

Own cheap large caps which own stocks of companies which are themselves liquid. JPH has the highest dollar value of gain in value of RW Float to...

David Blennerhassett

Denso Corp Placement - Possible Placement by Toyota to Raise US$4.7bn

As per Reuters, Toyota Motor (7203 JP) could look to sell up to 10% of Denso Corp (6902 JP) to raise around US$4.7bn before the end of the year.

Sumeet Singh

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