Global Materials | Industrials | Commodities

Rahul Jain

Equity Bottom-Up

<ul>
<li>JFE Holdings rebounded from COVID-era losses to deliver peak earnings in FY22, followed by a gradual normalization through FY25, with stable steel volumes but declining margins amid weak domestic demand.</li>
<li>The group is investing ¥970B (~$6.5B) through FY2030 across decarbonization, product upgrades (e.g., electrical steel, galvanizing), and overseas downstream expansion to sustain competitiveness.</li>
<li>Adjusting for its ₹910B (~¥1.7T) JSW stake, ~30% of EV, JFE trades at just 2.7x EV/EBITDA—deeply discounted vs peers like Nippon Steel and POSCO.</li>
</ul>


JFE Holdings rebounded from COVID-era losses to deliver peak earnings in FY22, followed by a gradual normalization through FY25, with stable steel volumes but declining margins amid weak domestic demand.
The group is investing ¥970B (~$6.5B) through FY2030 across decarbonization, product upgrades (e.g., electrical steel, galvanizing), and overseas downstream expansion to sustain competitiveness.
Adjusting for its ₹910B (~¥1.7T) JSW stake, ~30% of EV, JFE trades at just 2.7x EV/EBITDA—deeply discounted vs peers like Nippon Steel and POSCO.


JFE Holdings (5411 JP) – Stable Core, Strategic JSW Stake, and Deep-Value Opportunity

Thematic (Sector/Industry)

<ul>
<li>The U.S. has doubled tariffs on imported steel and aluminum to 50%, citing national security and domestic industry protection.</li>
<li>The move is expected to raise domestic prices, reduce imports, and increase costs for metal-intensive industries.</li>
<li>Winners include U.S.-based producers like Nucor, United States Steel, Cleveland Cliffs and Century Aluminum; losers are foreign exporters like Aloca, RioTinto, Nippon Steel, Ford, GM etc.</li>
</ul>


The U.S. has doubled tariffs on imported steel and aluminum to 50%, citing national security and domestic industry protection.
The move is expected to raise domestic prices, reduce imports, and increase costs for metal-intensive industries.
Winners include U.S.-based producers like Nucor, United States Steel, Cleveland Cliffs and Century Aluminum; losers are foreign exporters like Aloca, RioTinto, Nippon Steel, Ford, GM etc.


Tariff Surge 2025: Winners, Losers, and the Real Impact on U.S. Steel and Aluminium

European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>Nippon Steel proposes binding governance safeguards, including a U.S. CEO, majority-U.S. board, and a “golden share” for U.S. veto power on strategic decisions.</li>
<li>USW union opposition remains vocal, but Trump’s political pivot reframes the deal as a domestic partnership, easing labor and nationalist concerns.</li>
<li>Antitrust risk is low due to limited overlap; CFIUS clearance remains the key regulatory hurdle, with approval possible by late July or early August.</li>
</ul>


Nippon Steel proposes binding governance safeguards, including a U.S. CEO, majority-U.S. board, and a “golden share” for U.S. veto power on strategic decisions.
USW union opposition remains vocal, but Trump’s political pivot reframes the deal as a domestic partnership, easing labor and nationalist concerns.
Antitrust risk is low due to limited overlap; CFIUS clearance remains the key regulatory hurdle, with approval possible by late July or early August.


Steel Resolve: Nippon's Deal Gains Traction Amid Regulatory Reforging

<ul>
<li>Trump’s endorsement removes the political overhang, reigniting momentum for Nippon Steel’s $55/share all-cash offer.</li>
<li>Implied EV/EBITDA of 8.94x reflects ~$2–3B in strategic synergies over standalone valuation.</li>
<li>11.59% annualized return offers attractive arbitrage upside with manageable regulatory and execution risk.</li>
</ul>


Trump’s endorsement removes the political overhang, reigniting momentum for Nippon Steel’s $55/share all-cash offer.
Implied EV/EBITDA of 8.94x reflects ~$2–3B in strategic synergies over standalone valuation.
11.59% annualized return offers attractive arbitrage upside with manageable regulatory and execution risk.


Forged in Politics: Nippon’s $55 Bid for X Heats Up Again

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>For the month of March 2025, 13 new transactions (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$14bn.</li>
<li>The average premium for the new transactions announced (or first discussed) in March was ~53%, with a year-to-date average also of 55%.</li>
<li>The average premiums for transactions in 2024 (129 transactions), (2023 (117), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) were 43%, 39%, 41%, 33%, 31%, and 31% .</li>
</ul>


For the month of March 2025, 13 new transactions (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$14bn.
The average premium for the new transactions announced (or first discussed) in March was ~53%, with a year-to-date average also of 55%.
The average premiums for transactions in 2024 (129 transactions), (2023 (117), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) were 43%, 39%, 41%, 33%, 31%, and 31% .


(Mostly) Asia M&A, Mar 2025 Wrap: ENN Energy, Gold Road, Spartan, Aeon Delight, Sinarmas, Topcon

Japan

Nippon Steel Corp is an integrated steel maker. The Company produces various types of steel products used for industrial machinery & equipment and exports them worldwide.  Nippon Steel provides plant construction and urban development and also develops new businesses such as chemicals, ceramics, electronic equipment and information & communication systems.

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Nippon Steel Corporation (5401 JP)

JFE Holdings (5411 JP) – Stable Core, Strategic JSW Stake, and Deep-Value Opportunity

JFE Holdings sees peak earnings in FY22, plans investments in decarbonization and product upgrades to sustain competitiveness, trading at a...

Rahul Jain

Tariff Surge 2025: Winners, Losers, and the Real Impact on U.S. Steel and Aluminium

The U.S. Midwest aluminum premium spiked by 54% on Monday and 164% YTD to $0.58/lb on June 2, driven by new tariffs and typical early-month...

Rahul Jain

Steel Resolve: Nippon's Deal Gains Traction Amid Regulatory Reforging

Trump's reversal revives Nippon Steel’s $55 bid for U.S. Steel. With political resistance easing and CFIUS re-review pending, risk-reward remains...

Jesus Rodriguez Aguilar

Forged in Politics: Nippon’s $55 Bid for X Heats Up Again

Trump's reversal unblocks Nippon’s $55 bid for U.S. Steel. Synergies justify the premium; arbitrage setup offers 11.6% return with downside...

Jesus Rodriguez Aguilar

(Mostly) Asia M&A, Mar 2025 Wrap: ENN Energy, Gold Road, Spartan, Aeon Delight, Sinarmas, Topcon

For the month of March, 13 new deals were discussed on Smartkarma with an overall deal size of ~US$14bn. The average premium for the new deals...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

JFE Holdings (5411 JP) – Stable Core, Strategic JSW Stake, and Deep-Value Opportunity

​JFE Holdings sees peak earnings in FY22, plans investments in decarbonization and product upgrades to sustain competitiveness, trading at a...

Rahul Jain

Tariff Surge 2025: Winners, Losers, and the Real Impact on U.S. Steel and Aluminium

The U.S. Midwest aluminum premium spiked by 54% on Monday and 164% YTD to $0.58/lb on June 2, driven by new tariffs and typical early-month...

Rahul Jain

Steel Resolve: Nippon's Deal Gains Traction Amid Regulatory Reforging

Trump's reversal revives Nippon Steel’s $55 bid for U.S. Steel. With political resistance easing and CFIUS re-review pending, risk-reward remains...

Jesus Rodriguez Aguilar

Forged in Politics: Nippon’s $55 Bid for X Heats Up Again

Trump's reversal unblocks Nippon’s $55 bid for U.S. Steel. Synergies justify the premium; arbitrage setup offers 11.6% return with downside...

Jesus Rodriguez Aguilar

(Mostly) Asia M&A, Mar 2025 Wrap: ENN Energy, Gold Road, Spartan, Aeon Delight, Sinarmas, Topcon

For the month of March, 13 new deals were discussed on Smartkarma with an overall deal size of ~US$14bn. The average premium for the new deals...

David Blennerhassett

JFE Holdings sees peak earnings in FY22, plans investments in decarbonization and product upgrades to sustain competitiveness, trading at a...