Japan Experts, Extraordinary Performance, Astris Advisory Japan

Astris Advisory Japan

Japan Experts, Extraordinary Performance

Our Corporate Advisory service is designed to give clients access to a wider range of investors. These include Japan specialists as well as global investors. The goal is to help achieve a fair equity valuation.

Equity Bottom-Up

<ul>
<li>Capital recycling activity likely to increase as macro uncertainty fades – Although Q1-3 FY12/25 results show weakening margins, we think the margin dilution is temporary and will recover in the longer- term as the Company monetizes its current real estate portfolio and recycle the capital towards new investments.</li>
<li>With more certainty on Japan’s fiscal policy under new Prime Minister Takaichi and signs that the US-Japan trade relationship is on a more positive trajectory, deal activity in the Tokyo CRE market is likely to pick up in the coming quarters.</li>
<li>We believe Loadstar Capital is in a strong position to capitalize on the increase in deal activity to monetize its real estate properties and redeploy capital towards its pipeline of acquisition targets.</li>
</ul>


Capital recycling activity likely to increase as macro uncertainty fades – Although Q1-3 FY12/25 results show weakening margins, we think the margin dilution is temporary and will recover in the longer- term as the Company monetizes its current real estate portfolio and recycle the capital towards new investments.
With more certainty on Japan’s fiscal policy under new Prime Minister Takaichi and signs that the US-Japan trade relationship is on a more positive trajectory, deal activity in the Tokyo CRE market is likely to pick up in the coming quarters.
We believe Loadstar Capital is in a strong position to capitalize on the increase in deal activity to monetize its real estate properties and redeploy capital towards its pipeline of acquisition targets.


Loadstar Capital K.K. (3482) - Opportunities for Capital Deployment Ahead

<ul><li>Loadstar Capital is unique among listed Japanese real estate peers in its use of leverage, velocity of capital deployment, and shareholder alignment.</li><li>We believe the Company is much more akin to a real estate private equity fund in its approach towards capital allocation and focus on asset monetization.</li><li>Importantly, Loadstar’s founder, Mr. Tatsushi Iwano, continues to hold 20% of the Company, reflecting management’s alignment with shareholders and belief that Loadstar can continue to sustain its growth. </li></ul>

Loadstar Capital is unique among listed Japanese real estate peers in its use of leverage, velocity of capital deployment, and shareholder alignment.We believe the Company is much more akin to a real estate private equity fund in its approach towards capital allocation and focus on asset monetization.Importantly, Loadstar’s founder, Mr. Tatsushi Iwano, continues to hold 20% of the Company, reflecting management’s alignment with shareholders and belief that Loadstar can continue to sustain its growth. 

Loadstar Capital K.K. (3482 JP) - A Disciplined High Velocity Real Estate Investor

Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

<ul>
<li>Some low liquidity stocks in the TOPIX Index carry a liquidity factor of 0.75x resulting in their actual index weights being smaller than their default weights.</li>
<li>These names are reviewed every April and if the liquidity factor of a stock gets removed, the stock will enjoy buying flows from passive trackers of TOPIX.</li>
<li>In this insight, we take a look at Quiddity's final predictions for the names that are likely to see their Liquidity Factors removed in April 2023.</li>
</ul>


Some low liquidity stocks in the TOPIX Index carry a liquidity factor of 0.75x resulting in their actual index weights being smaller than their default weights.
These names are reviewed every April and if the liquidity factor of a stock gets removed, the stock will enjoy buying flows from passive trackers of TOPIX.
In this insight, we take a look at Quiddity's final predictions for the names that are likely to see their Liquidity Factors removed in April 2023.


TOPIX Index Upweights: Final Predictions for The "The Big April Basket” 2023

<ul>
<li>The Tokyo Stock Exchange (TSE) calculates Free-Float Weight (FFW) for each listed company and uses this value as a key component of TOPIX Index Calculation. </li>
<li>For companies with "low liquidity" the FFW will be multiplied by a fixed liquidity factor of 0.75 to derive the final FFW used for index calculation. </li>
<li>Every April, the application of this liquidity factor is reviewed by the TSE. In this insight, we take an early look at what could happen in April 2023.</li>
</ul>


The Tokyo Stock Exchange (TSE) calculates Free-Float Weight (FFW) for each listed company and uses this value as a key component of TOPIX Index Calculation. 
For companies with "low liquidity" the FFW will be multiplied by a fixed liquidity factor of 0.75 to derive the final FFW used for index calculation. 
Every April, the application of this liquidity factor is reviewed by the TSE. In this insight, we take an early look at what could happen in April 2023.


TOPIX Index Upweights: An Early Preview Of "The Big April Basket" 2023

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

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<li>
<a href="https://www.smartkarma.com/entities/mercari-inc" target="_blank" data-smartkarma-citation="entities:27149:1" rel="noopener">Mercari Inc (4385 JP)</a> will be added to the <a href="https://www.smartkarma.com/entities/tokyo-stock-exchange-tokyo-price-index-topix" target="_blank" data-smartkarma-citation="entities:22910:1" rel="noopener">Tokyo Stock Exchange Tokyo Price Index Topix (TPX INDEX)</a> at the close on 28 July.</li>
<li>There are a lot of FFW changes, mainly reductions. This leads to large funding inflows on the large index stocks.</li>
<li>We estimate the inclusion of Mercari and the FFW changes will lead to a one-way turnover of 0.56% leading to a one-way trade of JPY 442.23bn (US$3.25bn).</li>
</ul>



Mercari Inc (4385 JP) will be added to the Tokyo Stock Exchange Tokyo Price Index Topix (TPX INDEX) at the close on 28 July.
There are a lot of FFW changes, mainly reductions. This leads to large funding inflows on the large index stocks.
We estimate the inclusion of Mercari and the FFW changes will lead to a one-way turnover of 0.56% leading to a one-way trade of JPY 442.23bn (US$3.25bn).


TOPIX July Rebalance: Mercari Inclusion, FFW Changes, US$6.5bn To Trade

Japan

Loadstar Capital K.K. offers real estate services. The Company provides real estate crowdfunding, brokerage, consulting, and other services.

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Loadstar Capital (3482 JP)

Loadstar Capital K.K. (3482) - Opportunities for Capital Deployment Ahead

We believe Loadstar Capital is in a strong position to capitalize on the increase in deal activity to monetize its real estate properties and...

Astris Advisory Japan

Loadstar Capital K.K. (3482 JP) - A Disciplined High Velocity Real Estate Investor

Loadstar Capital is unique among listed Japanese real estate peers in its use of leverage, velocity of capital deployment, and shareholder alignment.

Astris Advisory Japan

TOPIX Index Upweights: Final Predictions for The "The Big April Basket” 2023

This insight (from Feb 2023) discusses the annual TOPIX Liquidity Factor (LF) removal event (which we call the "Big April Basket"). It might be a...

Janaghan Jeyakumar, CFA

TOPIX Index Upweights: An Early Preview Of "The Big April Basket" 2023

Daiei Kankyo, Socionext, Sun* , Mercari, Loadstar Capital, Bewith, Medley, and Appier Group are our high-conviction names that could see their...

Janaghan Jeyakumar, CFA

TOPIX July Rebalance: Mercari Inclusion, FFW Changes, US$6.5bn To Trade

Mercari will be added to the TPX at the close on 28 July. There are a lot of FFW changes that will result in one-way turnover of 0.56% leading to a...

Brian Freitas

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