Expert on Japan Retail and Consumer Markets, JapanConsuming

Michael Causton

Expert on Japan Retail and Consumer Markets

Real Insight on Japanese Consumer Markets

JapanConsuming

JapanConsuming is a specialist research firm producing intelligence on Japanese retail and consumer markets. Founded in 2000, JapanConsuming has become the leading provider of insights on Japanese retailers and consumer trends to retailers, brands, government agencies and investors. As well as a highly regarded monthly report on the market, JapanConsuming produces in-depth reports on retail sectors, seminars on key trends and telephone consulting to investors on trends and retailers.

JapanConsuming was founded by Michael Causton and Roy Larke. 

Event-Driven

<ul>
<li>ACT's bid for Seven &amp; I has been withdrawn and Seven will be better off long-term because of it – although we detail here how competitors are catching up fast.</li>
<li>Once York HD has been split off, the company can at last focus on its crucial local CVS operation: Japan makes up 25% of revenues but almost 50% of profits.</li>
<li>The potential is real and we are bullish on the long-term value but we would have been more bullish if the former CEO Ryuichi Isaka was still on board.</li>
</ul>


ACT's bid for Seven &amp; I has been withdrawn and Seven will be better off long-term because of it – although we detail here how competitors are catching up fast.
Once York HD has been split off, the company can at last focus on its crucial local CVS operation: Japan makes up 25% of revenues but almost 50% of profits.
The potential is real and we are bullish on the long-term value but we would have been more bullish if the former CEO Ryuichi Isaka was still on board.


The Final ACT Comedy of Errors Opens the Way for Real Value to Emerge at Seven & I

Thematic (Sector/Industry)

<ul>
<li>Consumer distribution has been transformed since 2020 through accelerated concentration of market share. While some has come about through organic growth, the real drivers have been M&amp;A and MBOs. </li>
<li>The result is a realignment of the retail leader board as companies like PPI, Welcia and Trial buy their way to the top, while others, notably Seven &amp; I, shrink.</li>
<li>Here we identify the retail leaders in driving consolidation going forward, and the intensifying pressure on both smaller retailers and the wholesalers that supply them.</li>
</ul>


Consumer distribution has been transformed since 2020 through accelerated concentration of market share. While some has come about through organic growth, the real drivers have been M&amp;A and MBOs. 
The result is a realignment of the retail leader board as companies like PPI, Welcia and Trial buy their way to the top, while others, notably Seven &amp; I, shrink.
Here we identify the retail leaders in driving consolidation going forward, and the intensifying pressure on both smaller retailers and the wholesalers that supply them.


[Japan M&A] Who Owns Who: The Growing Concentration of Power in Japanese Consumer Markets

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Yesterday a news article from Bloomberg suggested 7&amp;i was "considering" an MBO. <a href="https://www.smartkarma.com/entities/seven-i-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:1041:1" rel="noopener">Seven &amp; I Holdings (3382 JP)</a> later confirmed they had received a non-binding proposal from ITO Junro/family.</li>
<li>The initial number was ¥9trln. If market cap? High. If EV, too low. That would have implied a price just over the first "grossly inadequate" ACT price.</li>
<li>There is a lot we don't know. This changes the landscape. It probably shifts the range trade, but it will shift more when we get more clarity on ITO-san's price.</li>
</ul>


Yesterday a news article from Bloomberg suggested 7&amp;i was "considering" an MBO. Seven &amp; I Holdings (3382 JP) later confirmed they had received a non-binding proposal from ITO Junro/family.
The initial number was ¥9trln. If market cap? High. If EV, too low. That would have implied a price just over the first "grossly inadequate" ACT price.
There is a lot we don't know. This changes the landscape. It probably shifts the range trade, but it will shift more when we get more clarity on ITO-san's price.


7&I (3382 JP) - An ITO Family MBO? With Itochu? At ¥9trln? Maybe. Information Is Scarce

Equity Bottom-Up

<ul>
<li>Just as they did before, Japanese convenience stores are taking a US idea and making it Japanese, in this case retail media, which looks set to be huge in Japan.</li>
<li>Seven &amp; I believes it will be a ¥3 trillion business and Familymart, which is leading in this new profit machine, expects ¥5 billion in media income in 3 years.</li>
<li>The options for highly personalised targeting and behavioural analysis will transform brand advertising and marketing – but even more the bottom line of convenience stores.</li>
</ul>


Just as they did before, Japanese convenience stores are taking a US idea and making it Japanese, in this case retail media, which looks set to be huge in Japan.
Seven &amp; I believes it will be a ¥3 trillion business and Familymart, which is leading in this new profit machine, expects ¥5 billion in media income in 3 years.
The options for highly personalised targeting and behavioural analysis will transform brand advertising and marketing – but even more the bottom line of convenience stores.


How Seven Eleven and Other Conbinis Are Sitting on a Retail Media Goldmine

David Blennerhassett

<ul>
<li>Back in October 2023, a consortium including <a href="https://www.smartkarma.com/entities/first-pacific-co-ltd" target="_blank" data-smartkarma-citation="entities:173:1" rel="noopener">First Pacific (142 HK)</a> took <a href="https://www.smartkarma.com/entities/metro-pacific-investments-co" target="_blank" data-smartkarma-citation="entities:1054:1" rel="noopener">Metro Pacific Investments Co (MPI PM)</a> private. First Pac's 46.2% share at delisting was worth ~US$1.25bn.</li>
<li>Following <a href="https://www.smartkarma.com/entities/mitsui-co-ltd" target="_blank" data-smartkarma-citation="entities:20799:1" rel="noopener">Mitsui (8031 JP)</a>-backed Mit-Pacific's possible stake in a tollway operator held by MPIC, First Pac's 43.2% holding in MPIC, including the 47.5% stake in Meralco, is potentially worth ~US$3.21bn.</li>
<li>The question is whether this recent development from Mitsui has any bearing. First Pac's discount to NAV is elevated versus its historical trading range. </li>
</ul>


Back in October 2023, a consortium including First Pacific (142 HK) took Metro Pacific Investments Co (MPI PM) private. First Pac's 46.2% share at delisting was worth ~US$1.25bn.
Following Mitsui (8031 JP)-backed Mit-Pacific's possible stake in a tollway operator held by MPIC, First Pac's 43.2% holding in MPIC, including the 47.5% stake in Meralco, is potentially worth ~US$3.21bn.
The question is whether this recent development from Mitsui has any bearing. First Pac's discount to NAV is elevated versus its historical trading range. 


First Pacific (142 HK): Even More Value In The Stub

Japan

MITSUI & CO., LTD. is a general trading company.  The Company has operating groups including Iron and Steel, Non-Ferrous Metals, Machinery, Chemicals, Foods, Energy, Textiles, and General Merchandise.  Mitsui also operates real estate and overseas development projects.

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Mitsui & Co Ltd (8031 JP)

The Final ACT Comedy of Errors Opens the Way for Real Value to Emerge at Seven & I

ACT's bid for Seven & I withdrawn, company to focus on crucial CVS operation in Japan for long-term growth, potential vast but more bullish if...

Michael Causton

[Japan M&A] Who Owns Who: The Growing Concentration of Power in Japanese Consumer Markets

Consumer distribution has shifted post-2020, with market concentration driven by M&A and MBOs. We identify the leaders of this consolidation,...

Michael Causton

7&I (3382 JP) - An ITO Family MBO? With Itochu? At ¥9trln? Maybe. Information Is Scarce

An MBO for Seven & i by the ITO family? Maybe. And the number was big (¥3450/sh), unless it was small (¥2,300/sh), and we don't know which. But it...

Travis Lundy

How Seven Eleven and Other Conbinis Are Sitting on a Retail Media Goldmine

Japanese CVS are adapting retail media and expect this to be a ¥3 trillion business with highly personalised targeting and behavioural analysis...

Michael Causton

First Pacific (142 HK): Even More Value In The Stub

First Pac's NAV discount has narrowed, and trading around multi-year lows. There is clear value in the NAV. And trading volume is up. But absent a...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

The Final ACT Comedy of Errors Opens the Way for Real Value to Emerge at Seven & I

​ACT's bid for Seven & I withdrawn, company to focus on crucial CVS operation in Japan for long-term growth, potential vast but more bullish if...

Michael Causton

[Japan M&A] Who Owns Who: The Growing Concentration of Power in Japanese Consumer Markets

​Consumer distribution has shifted post-2020, with market concentration driven by M&A and MBOs. We identify the leaders of this consolidation,...

Michael Causton

7&I (3382 JP) - An ITO Family MBO? With Itochu? At ¥9trln? Maybe. Information Is Scarce

An MBO for Seven & i by the ITO family? Maybe. And the number was big (¥3450/sh), unless it was small (¥2,300/sh), and we don't know which. But it...

Travis Lundy

How Seven Eleven and Other Conbinis Are Sitting on a Retail Media Goldmine

​Japanese CVS are adapting retail media and expect this to be a ¥3 trillion business with highly personalised targeting and behavioural analysis...

Michael Causton

First Pacific (142 HK): Even More Value In The Stub

First Pac's NAV discount has narrowed, and trading around multi-year lows. There is clear value in the NAV. And trading volume is up. But absent a...

David Blennerhassett

ACT's bid for Seven & I withdrawn, company to focus on crucial CVS operation in Japan for long-term growth, potential vast but more bullish if...

Consumer distribution has shifted post-2020, with market concentration driven by M&A and MBOs. We identify the leaders of this consolidation,...

Japanese CVS are adapting retail media and expect this to be a ¥3 trillion business with highly personalised targeting and behavioural analysis...