Equity Long-Short

Mo Aziz

Equity Bottom-Up

<ul>
<li>PwC has declined to sign Nidec's accounts for a second consecutive year — a disclaimer of opinion that leaves ¥1.1tn of disclosed losses technically unaudited and unverified.</li>
<li>The 28 October TSE Special Alert review is a hard binary: resolution or formal delisting proceedings. Institutional mandates requiring audited financials cannot engage until PwC signs.</li>
<li>AVOID / REDUCE maintained; FV ¥2,000 on 8x normalised FY2027E EBITDA, discounted 30% for audit and delisting risk. The loss quantum is known — the audit gap is not.</li>
</ul>


PwC has declined to sign Nidec's accounts for a second consecutive year — a disclaimer of opinion that leaves ¥1.1tn of disclosed losses technically unaudited and unverified.
The 28 October TSE Special Alert review is a hard binary: resolution or formal delisting proceedings. Institutional mandates requiring audited financials cannot engage until PwC signs.
AVOID / REDUCE maintained; FV ¥2,000 on 8x normalised FY2027E EBITDA, discounted 30% for audit and delisting risk. The loss quantum is known — the audit gap is not.


NIDEC Corp (6594 JP): ¥1.1tn Written Off. PwC Still Won't Sign. AVOID This Headache

<ul>
<li>The ¥1tn impairment remains unconfirmed, but the market has already lost ¥500bn — pricing roughly half the reported accounting damage.</li>
<li>EV motors delivered &lt;40% of target revenue, China share has effectively disappeared, and the CEO exit leaves a governance vacuum.</li>
<li>AVOID / REDUCE: ¥2,000 target; wait for audit resolution as ¥2,405 still offers little margin of safety and downside remains asymmetric.</li>
</ul>


The ¥1tn impairment remains unconfirmed, but the market has already lost ¥500bn — pricing roughly half the reported accounting damage.
EV motors delivered &lt;40% of target revenue, China share has effectively disappeared, and the CEO exit leaves a governance vacuum.
AVOID / REDUCE: ¥2,000 target; wait for audit resolution as ¥2,405 still offers little margin of safety and downside remains asymmetric.


NIDEC Corp. (6594 JP): JP¥1tn Shock Has Not Finished the Job: Price Discovery Is Still Ahead

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) 🚨

Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>Tech laggards bought in the US showing many in the market scrambling to catch the upside after the rapid snapback from last weeks drop.</li>
<li>Server related strength after Cisco numbers may see sentiment for Nidec finally improving with its cooling modules business emerging as an earnings driver.</li>
<li>Strong numbers for Coherent confirm the positive trends for its optical transceiver business which points to continued upside for AI data center plays</li>
</ul>


Tech laggards bought in the US showing many in the market scrambling to catch the upside after the rapid snapback from last weeks drop.
Server related strength after Cisco numbers may see sentiment for Nidec finally improving with its cooling modules business emerging as an earnings driver.
Strong numbers for Coherent confirm the positive trends for its optical transceiver business which points to continued upside for AI data center plays


Japan Morning Connection: Sanken Electric, Nidec, Asahi Intecc

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.

Event-Driven

<ul>
<li>Urgent Regulatory Deadline: Nidec faces a critical deadline of September 26, 2025. Meeting this deadline is crucial to avoid regulatory consequences, including potential "Security on Alert" designation or stock suspension.</li>
<li>Underlying Strength Amidst Issues: Despite recent compliance issues that have impacted its stock, Nidec maintains a strong position as a global leader in electric motors with diversified revenue, projected growth.</li>
<li>Potential for Rebound: The current low valuation, may present a buying opportunity for long-term investors if the company successfully addresses its governance issues and restores investor confidence.</li>
</ul>


Urgent Regulatory Deadline: Nidec faces a critical deadline of September 26, 2025. Meeting this deadline is crucial to avoid regulatory consequences, including potential "Security on Alert" designation or stock suspension.
Underlying Strength Amidst Issues: Despite recent compliance issues that have impacted its stock, Nidec maintains a strong position as a global leader in electric motors with diversified revenue, projected growth.
Potential for Rebound: The current low valuation, may present a buying opportunity for long-term investors if the company successfully addresses its governance issues and restores investor confidence.


Nidec: Navigating Regulatory Challenges and Unlocking Value

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.

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

Nidec Corp (6594 JP)