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>Nisshinbo is aiming for a radical transformation from old-fashioned textile business to high-tech, aiming for 80% revenue from defense and high-end tech within 3-5 years </li>
<li>New President Yasuji Ishii promises swift decision-making and a comprehensive restructuring plan by February 2026, targeting 10% RoE, up from a 8% deficit at the trough.</li>
<li>Nisshinbo trades at 70% of book value but should easily trade up to 1.5x if it achieves its Roe target.</li>
</ul>


Nisshinbo is aiming for a radical transformation from old-fashioned textile business to high-tech, aiming for 80% revenue from defense and high-end tech within 3-5 years 
New President Yasuji Ishii promises swift decision-making and a comprehensive restructuring plan by February 2026, targeting 10% RoE, up from a 8% deficit at the trough.
Nisshinbo trades at 70% of book value but should easily trade up to 1.5x if it achieves its Roe target.


Can Nisshinbo (3105) Become a Superstock?

Research Coverage of Japanese Listed Companies, Shared Research Inc

Shared Research

Research Coverage of Japanese Listed Companies

Shared Research Inc

Pioneering research coverage of Japanese listed companies. Now customizable and interactive for global institutional investors. Corporate access reimagined.

<ul><li>The company posted sales of JPY254.7bn (+6.1% YoY) and operating profit of JPY18.4bn (+174.3% YoY), with increased profits in Wireless and Communications and Real Estate.</li><li>The FY12/25 forecast anticipates sales of JPY506.0bn (+2.3% YoY) and operating profit of JPY19.7bn (+18.8% YoY), with a revised net income forecast of JPY11.0bn (+7.0% YoY).</li><li>Structural reform in Wireless and Communications is prioritized, with an early retirement program and extraordinary losses impacting net income.</li></ul>

The company posted sales of JPY254.7bn (+6.1% YoY) and operating profit of JPY18.4bn (+174.3% YoY), with increased profits in Wireless and Communications and Real Estate.The FY12/25 forecast anticipates sales of JPY506.0bn (+2.3% YoY) and operating profit of JPY19.7bn (+18.8% YoY), with a revised net income forecast of JPY11.0bn (+7.0% YoY).Structural reform in Wireless and Communications is prioritized, with an early retirement program and extraordinary losses impacting net income.

Nisshinbo Holdings (3105 JP): 1H FY12/25 flash update

<ul><li>The company reported JPY151.2bn in sales (+15.6% YoY) and JPY21.3bn operating profit (+161.3% YoY), with Wireless and Communications and Real Estate offsetting Micro Devices' decline.</li><li>Wireless and Communications sales reached JPY81.1bn (+10.1% YoY), driven by radar systems and marine systems, despite mobility business decline.</li><li>Real Estate sales increased to JPY14.9bn, with significant profit from residential and commercial property sales in Japan.</li></ul>

The company reported JPY151.2bn in sales (+15.6% YoY) and JPY21.3bn operating profit (+161.3% YoY), with Wireless and Communications and Real Estate offsetting Micro Devices' decline.Wireless and Communications sales reached JPY81.1bn (+10.1% YoY), driven by radar systems and marine systems, despite mobility business decline.Real Estate sales increased to JPY14.9bn, with significant profit from residential and commercial property sales in Japan.

Nisshinbo Holdings (3105 JP): Q1 FY12/25 flash update

<ul><li>FY12/24 sales reached 102.0% of forecast; operating profit 110.5%, recurring profit 128.4%, and net income 102.8%.</li><li>FY12/25 forecast: sales JPY506.0bn (+2.3% YoY), operating profit JPY19.7bn (+18.8% YoY), net income JPY18.3bn (+78.1% YoY).</li><li>Wireless and Communications segment expects increased sales and profit due to demand for disaster prevention systems and defense-related business.</li></ul>

FY12/24 sales reached 102.0% of forecast; operating profit 110.5%, recurring profit 128.4%, and net income 102.8%.FY12/25 forecast: sales JPY506.0bn (+2.3% YoY), operating profit JPY19.7bn (+18.8% YoY), net income JPY18.3bn (+78.1% YoY).Wireless and Communications segment expects increased sales and profit due to demand for disaster prevention systems and defense-related business.

Nisshinbo Holdings (3105 JP): Full-year FY12/24 flash update

Global Materials | Industrials | Commodities

Rahul Jain

Thematic (Sector/Industry)

<ul>
<li>Japan’s defence renaissance is underway, driven by structural budget growth toward 2%+ of GDP.</li>
<li>Multi-Decade tailwinds in missiles, cyber, and naval systems will reshape the domestic defence industry.</li>
<li>Investors should balance national champions with mid-cap leverage plays to capture both visibility and alpha.</li>
</ul>


Japan’s defence renaissance is underway, driven by structural budget growth toward 2%+ of GDP.
Multi-Decade tailwinds in missiles, cyber, and naval systems will reshape the domestic defence industry.
Investors should balance national champions with mid-cap leverage plays to capture both visibility and alpha.


Japan Defence Supercycle: Multi-Decade Tailwinds, Near-Term Catalysts

Japan

Nisshinbo Holdings Inc. manufactures cotton fabrics, synthetic textiles, and chemical products used in apparel and industrial materials.  The Company also makes a variety of paper products, electronics products for wireless communication devices and semiconductors, and specialized machines for industrial manufacturing. In addition, Nisshinbo makes brakes for automobiles.

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Nisshinbo Holdings (3105 JP)

Can Nisshinbo (3105) Become a Superstock?

Nisshinbo aims for a radical transformation to defense and high-tech juggernaut with new president promising swift decision-making and more than...

Michael Allen