Japanese Turnaround Situations, Short-Ideas, Azabu Research

Michael Allen

Japanese Turnaround Situations, Short-Ideas

Azabu Research

Azabu Research is a publishing and consulting firm focused on distressed equities in the Japanese market. We specialize in turnaround strategies, corporate combinations, divestitures, and restructuring.

Publisher of the Tokyo Turnaround Letter, which conducts the most thorough research possible of publicly available information, including forensic tests for fraudulent overstatement of assets and understatement of liabilities, as well as rigorous market and industry analysis to assess the underlying strengths of the company’s products or services, the appropriateness of the company’s turnaround strategy, and the skill of its current management team. The average length of a report exceeds 25 pages of text and tables, excluding any disclosures or executive summaries.

We have more than 30 years of experience in applying this process to distressed equities in Japan. Additionally, subscribers have free access to detailed, yet easily navigated earnings models for the target company as well as the top five comparable companies, and unlimited access to the analyst for follow-up questions.

Azabu Research also conducts be-spoke research on a project basis, and provides consulting services to companies looking to restructure, divest, make acquisitions, go public, or improve investor sentiment toward their stock.

Independent Research and Consulting Firm

Equity Bottom-Up

<ul>
<li>Until the latest accounting scandal, Nidec was just another stupidly over-valued company that chased too many rainbows and missed too many targets.</li>
<li>Now, finally, it has fallen to interesting valuations and there is a real incentive to fix the things that need fixing. </li>
<li>Nidec is a governance nightmare with poor oversight, a history of bad strategic decisions, and shoddy execution. If these are fixed, though, the upside is enormous.</li>
</ul>


Until the latest accounting scandal, Nidec was just another stupidly over-valued company that chased too many rainbows and missed too many targets.
Now, finally, it has fallen to interesting valuations and there is a real incentive to fix the things that need fixing. 
Nidec is a governance nightmare with poor oversight, a history of bad strategic decisions, and shoddy execution. If these are fixed, though, the upside is enormous.


Can Nidec (6594) Ever Wake Up from Its Compliance Nightmare?

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

Index Rebalance

<ul>
<li>The JPX has designated <a href="https://www.smartkarma.com/entities/nidec-corp" target="_blank" data-smartkarma-citation="entities:7245:1" rel="noopener">Nidec Corp (6594 JP)</a> as a 'Security on Special Alert' due to a disclaimer of opinion in the annual report (among other issues).</li>
<li>Nikkei has announced the deletion of <a href="https://www.smartkarma.com/entities/nidec-corp" target="_blank" data-smartkarma-citation="entities:7245:1" rel="noopener">Nidec Corp (6594 JP)</a> from the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a>. <a href="https://www.smartkarma.com/entities/ibiden-co-ltd" target="_blank" data-smartkarma-citation="entities:16630:1" rel="noopener">Ibiden Co Ltd (4062 JP)</a> will be added to the index.</li>
<li>
<a href="https://www.smartkarma.com/entities/nidec-corp" target="_blank" data-smartkarma-citation="entities:7245:1" rel="noopener">Nidec Corp (6594 JP)</a> should also be deleted from 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">TSE Tokyo Price Index TOPIX (TPX INDEX)</a>. Both index deletions should take the stock a lot lower from here.</li>
</ul>


The JPX has designated Nidec Corp (6594 JP) as a 'Security on Special Alert' due to a disclaimer of opinion in the annual report (among other issues).
Nikkei has announced the deletion of Nidec Corp (6594 JP) from the Nikkei 225 (NKY INDEX). Ibiden Co Ltd (4062 JP) will be added to the index.

Nidec Corp (6594 JP) should also be deleted from the TSE Tokyo Price Index TOPIX (TPX INDEX). Both index deletions should take the stock a lot lower from here.


Nikkei 225 Index Rebalance: 🚨Ibiden (4062 JP) To Replace Nidec (6594 JP) 🚨

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nidec-corp" target="_blank" data-smartkarma-citation="entities:7245:1" rel="noopener">Nidec (6594 JP)</a>'s deletion is a LOT of stock to sell. The <a href="https://www.smartkarma.com/entities/ibiden-co-ltd" target="_blank" data-smartkarma-citation="entities:16630:1" rel="noopener">Ibiden (4062 JP)</a>'s Nikkei 225 inclusion is huge. It'll make the stock enormously squeezy for a long while.</li>
<li>Palliser has a point. <a href="https://www.smartkarma.com/entities/lg-chem-ltd" target="_blank" data-smartkarma-citation="entities:3583:1" rel="noopener">LG Chem (051910 KS)</a> should pare down its <a href="https://www.smartkarma.com/entities/lg-energy-solution" target="_blank" data-smartkarma-citation="entities:33464:1" rel="noopener">LG Energy Solution (373220 KS)</a> stake, and buy back shares. Yet, would/will management stubbornly swat away any such proposal?</li>
<li>The latest twist in the <a href="https://www.smartkarma.com/entities/mayne-pharma-group-ltd" target="_blank" data-smartkarma-citation="entities:757:1" rel="noopener">Mayne Pharma (MYX AU)</a> saga as FIRB looks set to ding the transaction if there is a possibility Cosette closes a manufacturing site in Adelaide.</li>
</ul>



Nidec (6594 JP)'s deletion is a LOT of stock to sell. The Ibiden (4062 JP)'s Nikkei 225 inclusion is huge. It'll make the stock enormously squeezy for a long while.
Palliser has a point. LG Chem (051910 KS) should pare down its LG Energy Solution (373220 KS) stake, and buy back shares. Yet, would/will management stubbornly swat away any such proposal?
The latest twist in the Mayne Pharma (MYX AU) saga as FIRB looks set to ding the transaction if there is a possibility Cosette closes a manufacturing site in Adelaide.


Last Week In Event SPACE: Nidec/Ibiden, LG Chem, Mayne Pharma, Jardine Matheson

Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

<ul>
<li>JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.</li>
<li>The annual index review takes place in August every year. We look at the latest rankings of potential ADDs/DELs every month.</li>
<li>Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in August 2026 based on trading data as of end-October 2025.</li>
</ul>


JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
The annual index review takes place in August every year. We look at the latest rankings of potential ADDs/DELs every month.
Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in August 2026 based on trading data as of end-October 2025.


Quiddity JPX-Nikkei 400 Rebal 2026: End-Oct 2025 Ranks

Equity/Index & Cross Asset Volatility Specialist, Cameron Design

Jay Cameron

Equity/Index & Cross Asset Volatility Specialist

Cameron Design

We specialize in financial products and volatility. Our strategies balance speed, data, and risk control to capture opportunities across global markets. Our research leverages AI and data analytics to continuously refine our algorithms and adapt to evolving market dynamics.

Equity Derivatives

<ul>
<li>Japanese markets are seeing significant developments, including Nikkei 225 rebalancing with Nidec's removal due to alert and Ibiden's addition, impacting tracking funds, delta one trading strategies, and investors with position.</li>
<li>The BoJ's cautious normalization path continues to shape the JGB curve, with a notable steepening in the long end affecting asset-liability management.</li>
<li>We detail the trades and execution of the trade idea, which may require special attention this week especially on the rebalance.</li>
</ul>


Japanese markets are seeing significant developments, including Nikkei 225 rebalancing with Nidec's removal due to alert and Ibiden's addition, impacting tracking funds, delta one trading strategies, and investors with position.
The BoJ's cautious normalization path continues to shape the JGB curve, with a notable steepening in the long end affecting asset-liability management.
We detail the trades and execution of the trade idea, which may require special attention this week especially on the rebalance.


A Special Cross Asset Morning Update: Nidec, Ibiden, and BoJ This Week

Japan

NIDEC CORPORATION is the world's leading manufacturer of small precision motors mainly used in HDD and optical disk drives. The company has extended its focus to the home appliance and automotive markets. NIDEC is active in M&A and its subsidiaries include the world's leading manufacturers of LCD panel handling robots and camera shutters.

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Nidec Corp (6594 JP)

Can Nidec (6594) Ever Wake Up from Its Compliance Nightmare?

Nidec, once over-valued and plagued by governance issues, now presents a potential opportunity for improvement and potential upside.

Michael Allen

Nikkei 225 Index Rebalance: 🚨Ibiden (4062 JP) To Replace Nidec (6594 JP) 🚨

TOPIX trackers are estimated to sell a lot of Nidec shares at the close today. Ibiden is already up a lot and that could lead to inclusion in a...

Brian Freitas

Last Week In Event SPACE: Nidec/Ibiden, LG Chem, Mayne Pharma, Jardine Matheson

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

Quiddity JPX-Nikkei 400 Rebal 2026: End-Oct 2025 Ranks

We expect the HIGH-conviction Potential ADDs to outperform the HIGH-conviction Potential DELs. Nidec is no longer part of our potential ADDs.

Janaghan Jeyakumar, CFA

A Special Cross Asset Morning Update: Nidec, Ibiden, and BoJ This Week

A very busy and active week for Japan markets is expected in equities, while a BoJ meeting is on the way later on presenting cross asset trades and...

Jay Cameron

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Can Nidec (6594) Ever Wake Up from Its Compliance Nightmare?

​Nidec, once over-valued and plagued by governance issues, now presents a potential opportunity for improvement and potential upside.

Michael Allen

Nikkei 225 Index Rebalance: 🚨Ibiden (4062 JP) To Replace Nidec (6594 JP) 🚨

TOPIX trackers are estimated to sell a lot of Nidec shares at the close today. Ibiden is already up a lot and that could lead to inclusion in a...

Brian Freitas

Last Week In Event SPACE: Nidec/Ibiden, LG Chem, Mayne Pharma, Jardine Matheson

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

Quiddity JPX-Nikkei 400 Rebal 2026: End-Oct 2025 Ranks

We expect the HIGH-conviction Potential ADDs to outperform the HIGH-conviction Potential DELs. Nidec is no longer part of our potential ADDs.

Janaghan Jeyakumar, CFA

A Special Cross Asset Morning Update: Nidec, Ibiden, and BoJ This Week

A very busy and active week for Japan markets is expected in equities, while a BoJ meeting is on the way later on presenting cross asset trades and...

Jay Cameron

Nidec, once over-valued and plagued by governance issues, now presents a potential opportunity for improvement and potential upside.