Research from Asian Century Stocks, Asian Century Stocks

Michael Fritzell

Research from Asian Century Stocks

Providing financial journalism in the Asia-Pacific

Asian Century Stocks

Asian Century Stocks is a newsletter providing financial journalism for companies and stocks in the Asia-Pacific. 
The Asian Century Stocks logotype “百” stands for “one hundred” or a “century”. The economic centre of gravity is moving towards Asia. Yet most global investors are missing out.

Equity Bottom-Up

<ul>
<li>Japan's leading developer of talent management software, used by companies to manage their staff. Key selling points include staff deployment, periodic evaluations, surveys, training, internal recruitment</li>
<li>Low valuation at 2.1x EV/Sales, long-term operating margin guidance of 20%+ on top of predictable 20-30% sustainable growth</li>
<li>Near-Term catalysts include the recent releases of labor management service “Roum Mate”, budget control system called “Yojitsutic”</li>
</ul>


Japan's leading developer of talent management software, used by companies to manage their staff. Key selling points include staff deployment, periodic evaluations, surveys, training, internal recruitment
Low valuation at 2.1x EV/Sales, long-term operating margin guidance of 20%+ on top of predictable 20-30% sustainable growth
Near-Term catalysts include the recent releases of labor management service “Roum Mate”, budget control system called “Yojitsutic”


Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>Japan's tech market sees major movement with Carlyle's 120% premium bid for Kaonavi, highlighting the stark valuation gap between Japanese and US SaaS companies.</li>
<li>Many Japanese software firms trade at significantly lower multiples (4x) versus US peers (8x), attracting private equity attention.</li>
<li>Japanese stocks ended the week up around 1%. Global macro concerns and inflation lifting bond yields and raising concern over a stronger yen. </li>
</ul>


Japan's tech market sees major movement with Carlyle's 120% premium bid for Kaonavi, highlighting the stark valuation gap between Japanese and US SaaS companies.
Many Japanese software firms trade at significantly lower multiples (4x) versus US peers (8x), attracting private equity attention.
Japanese stocks ended the week up around 1%. Global macro concerns and inflation lifting bond yields and raising concern over a stronger yen. 


Japan Strategy Weekly | Carlyle's Kaonavi Deal Signals a Shift in Japanese Valuations

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Another Japanese smallcap takeover at a huge premium. Must be a day ending in "y." It is a thing recently. </li>
<li>Interestingly, this is NOT an MBO. It is an LBO. Carlyle is buying out <a href="https://www.smartkarma.com/entities/kaonavi-inc" target="_blank" data-smartkarma-citation="entities:29703:1" rel="noopener">Kaonavi Inc (4435 JP)</a> at ¥4,380/share which is 19x book and 89x EBIT. Nice price.</li>
<li>I expect this gets done easily because the co-CEO with 28.7% and Recruit with 20.6% are putting in. There's another easy 9.7%. One more holder and this is done.</li>
</ul>


Another Japanese smallcap takeover at a huge premium. Must be a day ending in "y." It is a thing recently. 
Interestingly, this is NOT an MBO. It is an LBO. Carlyle is buying out Kaonavi Inc (4435 JP) at ¥4,380/share which is 19x book and 89x EBIT. Nice price.
I expect this gets done easily because the co-CEO with 28.7% and Recruit with 20.6% are putting in. There's another easy 9.7%. One more holder and this is done.


Kaonavi (4435 JP) - Small HR Software Co Gets 121% Premium LBO from Carlyle

Smartkarma AI Primers, Smartkarma

αSK Primers

Smartkarma AI Primers

Smartkarma

Smartkarma unites the fragmented investment industry, connecting institutional investors, independent research providers, and corporates within a single network.

Research Reinvented

<ul>
 <li>Kaonavi is a leading Japanese provider of cloud-based talent management software, capitalizing on the nation's push for digital transformation and HR efficiency.</li>
 <li>The company has demonstrated a strong track record of revenue growth, driven by an expanding customer base and the increasing adoption of HR technology in Japan to combat labor shortages.</li>
 <li>A significant recent development is the acquisition by private equity firm Carlyle Group, which is expected to accelerate growth and strategic initiatives by taking the company private and providing substantial resources.</li>
</ul>This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.


  Kaonavi is a leading Japanese provider of cloud-based talent management software, capitalizing on the nation's push for digital transformation and HR efficiency.
  The company has demonstrated a strong track record of revenue growth, driven by an expanding customer base and the increasing adoption of HR technology in Japan to combat labor shortages.
  A significant recent development is the acquisition by private equity firm Carlyle Group, which is expected to accelerate growth and strategic initiatives by taking the company private and providing substantial resources.
This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.

David Blennerhassett

<ul>
<li>At a zero net debt zero net cash (securities liquidated) Adjusted Price/Earnings Ratio of 11.3x expected Net Income, the multiple offered <a href="https://www.smartkarma.com/entities/makino-milling-machine-co" target="_blank" data-smartkarma-citation="entities:5200:1" rel="noopener">Makino Milling Machine (6135 JP)</a> is not a knock-out.</li>
<li>
<a href="https://www.smartkarma.com/entities/enn-energy-holdings-ltd" target="_blank" data-smartkarma-citation="entities:316:1" rel="noopener">ENN Energy (2688 HK)</a> investors hoping for a clean (er) exit, or where the back-end terms were clearly defined, will be disappointed. And minorities are active in this name. Avoid</li>
<li>New Trump Tariffs are not based on any actual tariffs, or non-tariff measures. The simple/explicit assumption is that if you run a trade surplus with the US, you are cheating.</li>
</ul>


At a zero net debt zero net cash (securities liquidated) Adjusted Price/Earnings Ratio of 11.3x expected Net Income, the multiple offered Makino Milling Machine (6135 JP) is not a knock-out.

ENN Energy (2688 HK) investors hoping for a clean (er) exit, or where the back-end terms were clearly defined, will be disappointed. And minorities are active in this name. Avoid
New Trump Tariffs are not based on any actual tariffs, or non-tariff measures. The simple/explicit assumption is that if you run a trade surplus with the US, you are cheating.


Last Week in Event SPACE: Makino, ENN Energy, Trump Tariffs, HKBN

Japan

kaonavi,inc. provides human resources management cloud services. The Company offers talent database, organization tree diagram, employee list and questionnaire, and evaluation workflow, as well as employee data graph and information sort, application programming interface cooperation, and other services. kaonavi serves clients across Japan.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Kaonavi Inc (4435 JP)

Kaonavi (4435 JP)

Recruit’s talent management SaaS platform at 2.1x EV/Sales with business model margins of 20%+ and sustainable growth well above 20%

Asian Century Stocks

Japan Strategy Weekly | Carlyle's Kaonavi Deal Signals a Shift in Japanese Valuations

Carlyle's bid for Kaonavi underscores valuation gap between Japanese and US SaaS companies, attracting private equity interest. Japanese stocks up...

Mark Chadwick

Kaonavi (4435 JP) - Small HR Software Co Gets 121% Premium LBO from Carlyle

Carlyle launches a 121% premium tender offer on a smallcap growth co. The co-CEO is selling out. Recruit too. This is a future bolt-on for Carlyle.

Travis Lundy

Primer: Kaonavi Inc (4435 JP) - Apr 2026

Kaonavi is a leading Japanese provider of cloud-based talent management software, capitalizing on the nation's push for digital transformation...

αSK Primers

Last Week in Event SPACE: Makino, ENN Energy, Trump Tariffs, HKBN

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Kaonavi (4435 JP)

Recruit’s talent management SaaS platform at 2.1x EV/Sales with business model margins of 20%+ and sustainable growth well above 20%

Asian Century Stocks

Japan Strategy Weekly | Carlyle's Kaonavi Deal Signals a Shift in Japanese Valuations

​Carlyle's bid for Kaonavi underscores valuation gap between Japanese and US SaaS companies, attracting private equity interest. Japanese stocks up...

Mark Chadwick

Kaonavi (4435 JP) - Small HR Software Co Gets 121% Premium LBO from Carlyle

Carlyle launches a 121% premium tender offer on a smallcap growth co. The co-CEO is selling out. Recruit too. This is a future bolt-on for Carlyle.

Travis Lundy

Primer: Kaonavi Inc (4435 JP) - Apr 2026

Kaonavi is a leading Japanese provider of cloud-based talent management software, capitalizing on the nation's push for digital transformation...

αSK Primers

Last Week in Event SPACE: Makino, ENN Energy, Trump Tariffs, HKBN

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

Carlyle's bid for Kaonavi underscores valuation gap between Japanese and US SaaS companies, attracting private equity interest. Japanese stocks up...