Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

NTT (Nippon Telegraph & Telephone) / Event-Driven

<ul>
<li>Six weeks ago, LDP Policy Research Council chairman KAGIUDA led a discussion about full NTT privatisation to fund defence. Today he said serious deliberations begin in August. Shares fell today.</li>
<li>The LDP wants non-tax resources to increase defence/social spending. Selling would require a change in NTT Law, but the argument is that communications have changed/internationalised.</li>
<li>As discussed in <a href="https://www.smartkarma.com/insights/ntt-9432-jp-would-the-govt-sell-all-its-shares-why-how-how-long-overhang" target="_blank" data-smartkarma-citation="insights:104184" rel="noopener">NTT (9432 JP) - Would the Govt Sell All Its Shares? Why? How? How Long? Overhang?</a>, there are questions on overhang. BUT... presumably there are mitigants. </li>
</ul>


Six weeks ago, LDP Policy Research Council chairman KAGIUDA led a discussion about full NTT privatisation to fund defence. Today he said serious deliberations begin in August. Shares fell today.
The LDP wants non-tax resources to increase defence/social spending. Selling would require a change in NTT Law, but the argument is that communications have changed/internationalised.
As discussed in NTT (9432 JP) - Would the Govt Sell All Its Shares? Why? How? How Long? Overhang?, there are questions on overhang. BUT... presumably there are mitigants. 


NTT (9432) - LDP Consideration of Full Sale Is Not Necessarily Overhang

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nippon-telegraph-telephone-corporation" target="_blank" data-smartkarma-citation="entities:623:1" rel="noopener">NTT (Nippon Telegraph &amp; Telephone) (9432 JP)</a> is splitting its stock 25:1 on record date 30 June 2023. That means it goes ex- at the new price on 29 June.</li>
<li>The day before, the stock is up nearly 5% on heavy volume. This is likely punters buying before it splits so one round lot will be &lt;¥20,000 vs ~¥420,000 yesterday.</li>
<li>But there is a new attraction for retail, somewhat un-noticed. </li>
</ul>



NTT (Nippon Telegraph &amp; Telephone) (9432 JP) is splitting its stock 25:1 on record date 30 June 2023. That means it goes ex- at the new price on 29 June.
The day before, the stock is up nearly 5% on heavy volume. This is likely punters buying before it splits so one round lot will be &lt;¥20,000 vs ~¥420,000 yesterday.
But there is a new attraction for retail, somewhat un-noticed. 


NTT's Really Big/Weird Stock Split Goes Ex- 29 June 2023. Now With D-Points!

Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

NTT (Nippon Telegraph & Telephone) / Equity Bottom-Up

<ul>
<li>Nikkei reported last week that <a href="https://www.smartkarma.com/entities/nippon-telegraph-telephone-corporation" target="_blank" data-smartkarma-citation="entities:623:1" rel="noopener">NTT (Nippon Telegraph &amp; Telephone) (9432 JP)</a> is developing a generative AI and plans to offer services to the company’s corporate clients by Next March.</li>
<li>Over the recent years, NTT has been extensively investing on AI, robotics and other data-driven products and services to boost its top line growth as its core business is saturating.</li>
<li>AI and semiconductors are two key policy areas of Japanese government for development as the country is dealing with population and other demographic changes.</li>
</ul>


Nikkei reported last week that NTT (Nippon Telegraph &amp; Telephone) (9432 JP) is developing a generative AI and plans to offer services to the company’s corporate clients by Next March.
Over the recent years, NTT has been extensively investing on AI, robotics and other data-driven products and services to boost its top line growth as its core business is saturating.
AI and semiconductors are two key policy areas of Japanese government for development as the country is dealing with population and other demographic changes.


NTT: Developing Industry-Specific AI Offerings as AI Becomes One of Government's Key Focus Areas

<ul>
<li>Today, <a href="https://www.smartkarma.com/entities/monex-group-inc" target="_blank" data-smartkarma-citation="entities:14211:1" rel="noopener">Monex Group Inc (8698 JP)</a> and <a href="https://www.smartkarma.com/entities/nippon-telegraph-telephone-corporation" target="_blank" data-smartkarma-citation="entities:623:1" rel="noopener">NTT (Nippon Telegraph &amp; Telephone) (9432 JP)</a>'s NTT Docomo announced a Capital and Business Alliance Agreement. It is a complicated deal.</li>
<li>Monex GROUP will create a holdco which owns Monex Inc (the broker) and sell 51% to Docomo. Docomo will consolidate. Monex Group will own 49% as an equity method affiliate.</li>
<li>Monex GROUP will then double its dividend, maybe buy back shares, and expects to grow as Docomo pushes and Monex invests. But what remains is a mixed bag.</li>
</ul>


Today, Monex Group Inc (8698 JP) and NTT (Nippon Telegraph &amp; Telephone) (9432 JP)'s NTT Docomo announced a Capital and Business Alliance Agreement. It is a complicated deal.
Monex GROUP will create a holdco which owns Monex Inc (the broker) and sell 51% to Docomo. Docomo will consolidate. Monex Group will own 49% as an equity method affiliate.
Monex GROUP will then double its dividend, maybe buy back shares, and expects to grow as Docomo pushes and Monex invests. But what remains is a mixed bag.


NTT Docomo's Deal with Monex (8698); The Goal Is Bigger and Better but Not Compelling Yet

Telco/Internet specialist

Kirk Boodry

Redex Research

Thematic (Sector/Industry)

<ul>
<li>Google will invest $735mn (¥105bn) through 2023 on Japan infrastructure including its first local data center and additional subsea capacity</li>
<li>The Google CEO met with Prime Minister Kishida and the announcement scores political points but it also makes sense with a material JP business and the weak yen</li>
<li>Google is probably Japan's largest Internet advertising company with an estimated ¥685bn in FY21 sales</li>
</ul>


Google will invest $735mn (¥105bn) through 2023 on Japan infrastructure including its first local data center and additional subsea capacity
The Google CEO met with Prime Minister Kishida and the announcement scores political points but it also makes sense with a material JP business and the weak yen
Google is probably Japan's largest Internet advertising company with an estimated ¥685bn in FY21 sales


Google in Japan - Infrastructure Investments Highlight Japan Growth and Forex Shift

Japan

Nippon Telegraph and Telephone Corporation provides a variety of telecommunication services, including telephone, telegraph, leased circuits, data communication, terminal equipment sales, and related services. The Company provides both local and long distance telephone services within Japan.

NTT (Nippon Telegraph & Telephone) (9432 JP)

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NTT (Nippon Telegraph & Telephone) (9432 JP)

NTT (9432) - LDP Consideration of Full Sale Is Not Necessarily Overhang

NTT dropped today outright and vs peers on news that the LDP is moving forward with "serious consideration" about a full selldown to fund defence...

Travis Lundy

NTT's Really Big/Weird Stock Split Goes Ex- 29 June 2023. Now With D-Points!

NTT 's 25:1 share split is ex- 29 Jun, a round lot will be < ¥20k. Surprisingly, the split does not affect the D-Points shareholder loyalty...

Travis Lundy

NTT: Developing Industry-Specific AI Offerings as AI Becomes One of Government's Key Focus Areas

NTT is developing a generative AI to offer to corporate clients. AI and semiconductors are two key focus areas of the govt which should benefit NTT...

Shifara Samsudeen, ACMA, CGMA

NTT Docomo's Deal with Monex (8698); The Goal Is Bigger and Better but Not Compelling Yet

NTT Docomo is going to take control of Monex Group's securities business leaving Monex with a 49% interest, some cash, the TradeStation biz,...

Travis Lundy

Google in Japan - Infrastructure Investments Highlight Japan Growth and Forex Shift

Increased investment in Japan makes sense as its business is growing and the dollar has strengthened. In-country facilities should mean better...

Kirk Boodry

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