Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Bottom-Up

<ul>
<li>In this insight, we discuss a pair trade involving a basket of Korean consumer stocks (long) and  a basket of Japanese consumer stocks (short) over the next 3-6 months.</li>
<li>The 10 Korean names (long basket) include Samyang Food, APR, Amorepacific Corp, Korean Air, CJ Corp, Classys, Nongshim, Shinsegae, Hotel Shilla, and Lotte Tour Development. </li>
<li>The 10 Japanese names (short basket) include Fast Retailing, Oriental Land, Kao Corp, Seibu Holdings, ANA Holdings, Shiseido, J.Front Retailing, Kose Corp, Pola Orbis Holdings, and Kyoritsu Maintenance. </li>
</ul>


In this insight, we discuss a pair trade involving a basket of Korean consumer stocks (long) and  a basket of Japanese consumer stocks (short) over the next 3-6 months.
The 10 Korean names (long basket) include Samyang Food, APR, Amorepacific Corp, Korean Air, CJ Corp, Classys, Nongshim, Shinsegae, Hotel Shilla, and Lotte Tour Development. 
The 10 Japanese names (short basket) include Fast Retailing, Oriental Land, Kao Corp, Seibu Holdings, ANA Holdings, Shiseido, J.Front Retailing, Kose Corp, Pola Orbis Holdings, and Kyoritsu Maintenance. 


A Pair Trade Basket Of Korean Consumer/Leisure Stocks (Long) And Japanese Names (Short)

Equity Analyst, LightStream Research

Oshadhi Kumarasiri

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.

<ul>
<li>During 2QFY24, Tokyo Disneyland and Tokyo DisneySea both saw a QoQ decline in Google search interest.</li>
<li>This suggests to us that there might be an earnings miss when <a href="https://www.smartkarma.com/entities/oriental-land-co-ltd" target="_blank" data-smartkarma-citation="entities:13517:1" rel="noopener">Oriental Land (4661 JP)</a> reports its FQ2 results on October 30, 2023.</li>
<li>Additionally, there are potential downside risks to both FY24 and medium-term consensus projections following a revised FY24 guidance announcement.</li>
</ul>


During 2QFY24, Tokyo Disneyland and Tokyo DisneySea both saw a QoQ decline in Google search interest.
This suggests to us that there might be an earnings miss when Oriental Land (4661 JP) reports its FQ2 results on October 30, 2023.
Additionally, there are potential downside risks to both FY24 and medium-term consensus projections following a revised FY24 guidance announcement.


Oriental Land: Google Search Signals Potential Miss; Guidance Could Challenge Consensus Optimism

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Keisei Electric Railway Co / Event-Driven

<ul>
<li>In October 2023 and then in early 2024, activist Palliser Capital demanded that <a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> sell down its stake in <a href="https://www.smartkarma.com/entities/oriental-land-co-ltd" target="_blank" data-smartkarma-citation="entities:13517:1" rel="noopener">Oriental Land (4661 JP)</a> to sub-15%.</li>
<li>Keisei in March sold 1% of OLC but in doing so, rejected the concept of removing equity affiliate status. They could go to a level just &gt;15%, or just &gt;20%. </li>
<li>Today, OLC announced a ToSTNeT-3 buyback of 18mm shares - the total for the 2yrs to Mar-26 <a href="https://www.olc.co.jp/en/news/news_olc/auto_20240426578292/pdfFile.pdf" target="_blank" rel="noopener">announced</a> (p19) in April. Keisei will sell and will stay above 20%. </li>
</ul>


In October 2023 and then in early 2024, activist Palliser Capital demanded that Keisei Electric Railway Co (9009 JP) sell down its stake in Oriental Land (4661 JP) to sub-15%.
Keisei in March sold 1% of OLC but in doing so, rejected the concept of removing equity affiliate status. They could go to a level just &gt;15%, or just &gt;20%. 
Today, OLC announced a ToSTNeT-3 buyback of 18mm shares - the total for the 2yrs to Mar-26 announced (p19) in April. Keisei will sell and will stay above 20%. 


Oriental Land ToSTNeT-3 Buyback From Keisei (9009) - It's In the Plan And Looks Better Than It Is

<ul>
<li>Over two decades, <a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> has been the subject of softer and harder activist efforts to have Keisei monetise its stake in affiliate Oriental Land (4661).</li>
<li>The most recent efforts were by Palliser last fall, briefly discussed <a href="https://www.smartkarma.com/insights/keisei-electric-rail-9009-a-buyback-but-it-s-likely-to-be-crossholders-selling-in-tostnet-3" target="_blank" rel="noopener">here</a> two weeks ago when Keisei announced a buyback. </li>
<li>Today, Keisei <a href="https://contents.xj-storage.jp/xcontents/AS01810/961e9d0f/2b7a/4eef/89ba/091c3bf36d72/140120240305549065.pdf" target="_blank" rel="noopener">announced</a> (Japanese only) an Accelerated Block Offering of 1% of Oriental Land shares. The accompanying announcement is worth reading. It's pretty clear.</li>
</ul>


Over two decades, Keisei Electric Railway Co (9009 JP) has been the subject of softer and harder activist efforts to have Keisei monetise its stake in affiliate Oriental Land (4661).
The most recent efforts were by Palliser last fall, briefly discussed here two weeks ago when Keisei announced a buyback. 
Today, Keisei announced (Japanese only) an Accelerated Block Offering of 1% of Oriental Land shares. The accompanying announcement is worth reading. It's pretty clear.


Oriental Land (4661) Placement by Keisei Rail (9009) Says "That's the Door"

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Quantitative Analysis

<ul>
<li>We analyzed the changes in margin trading positions of JPX stocks as of Oct 31st. The aggregated net margin trading position is USD18,547m.</li>
<li>We tabulate league tables for top/bottom net long/short of margin trading by value, net margin buy as multiple of ADT.</li>
<li>We highlight net margin buy/sell changes in Advantest, Kobe Bussan, Disco, Mitsubishi UFJ Financial, Fujikura, Kioxia, Keyence, Tokyo Electron, IHI, Socionext, Advantest, Kobe Bussan, Disco, Mitsubishi Ufj Financial, Fujikura.</li>
</ul>


We analyzed the changes in margin trading positions of JPX stocks as of Oct 31st. The aggregated net margin trading position is USD18,547m.
We tabulate league tables for top/bottom net long/short of margin trading by value, net margin buy as multiple of ADT.
We highlight net margin buy/sell changes in Advantest, Kobe Bussan, Disco, Mitsubishi UFJ Financial, Fujikura, Kioxia, Keyence, Tokyo Electron, IHI, Socionext, Advantest, Kobe Bussan, Disco, Mitsubishi Ufj Financial, Fujikura.


JPX Margin Trading Weekly (Oct 31st): Advantest, Kobe Bussan, Disco, Mitsubishi UFJ Financial

Japan

ORIENTAL LAND CO., LTD. operates Tokyo Disney Resort.  The Company also operates restaurants within the complex and sells Disney merchandise.

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Oriental Land (4661 JP)

A Pair Trade Basket Of Korean Consumer/Leisure Stocks (Long) And Japanese Names (Short)

In this insight, we discuss a pair trade involving a basket of Korean consumer stocks (long) and a basket of Japanese consumer stocks (short) over...

Douglas Kim

Oriental Land: Google Search Signals Potential Miss; Guidance Could Challenge Consensus Optimism

Oriental Land released its Q2 report today, with both revenue and operating profit falling below consensus expectations as we had anticipated....

Oshadhi Kumarasiri

Oriental Land ToSTNeT-3 Buyback From Keisei (9009) - It's In the Plan And Looks Better Than It Is

Oriental Land today announced that its planned FY24-25 2yr buyback of 18mm shares will happen tomorrow in a ToSTNeT-3 buyback. 1%. It keeps Keisei...

Travis Lundy

Oriental Land (4661) Placement by Keisei Rail (9009) Says "That's the Door"

Keisei Rail today announced the offering/sale of 16+mm shares (1.0%) of Oriental Land. There will be a special div as a result. The announcement...

Travis Lundy

JPX Margin Trading Weekly (Oct 31st): Advantest, Kobe Bussan, Disco, Mitsubishi UFJ Financial

We analyzed JPX margin trading positions report for the past week and highlighted Advantest (6857 JP), Kobe Bussan (3038 JP), Disco (6146 JP),...

Ke Yan, CFA, FRM

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