Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Bottom-Up

<ul>
<li>Sankyo is a leading Japanese maker of Pachinko and Pachislot machines. The company has a consistent record of generating positive free cash flow and operating cash flow.</li>
<li>It trades at 6x EV/EBITDA (2025E) and P/E of 9.5x (2025E). Its net margin improved from 9.9% in 2021 to 21.8% in 2022, and 27% in 2024.</li>
<li>Sankyo has also been aggressively buying back its shares in the past five years. We believe Sankyo could continue to outperform the market in the next 1-2 years. </li>
</ul>


Sankyo is a leading Japanese maker of Pachinko and Pachislot machines. The company has a consistent record of generating positive free cash flow and operating cash flow.
It trades at 6x EV/EBITDA (2025E) and P/E of 9.5x (2025E). Its net margin improved from 9.9% in 2021 to 21.8% in 2022, and 27% in 2024.
Sankyo has also been aggressively buying back its shares in the past five years. We believe Sankyo could continue to outperform the market in the next 1-2 years. 


Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Buybacks are a central part of Corporate Japan's effort to improve corporate/capital governance. Lots of cross-holders want/need to sell. Lots of companies want to reduce excess equity.</li>
<li>This earnings season has seen a LOT of new buybacks announced. ¥7.3trln in the last month and that doesn't even include the biggest buybacks extant by March-end companies.</li>
<li>We are experimenting with new ways of displaying data/analytics for buybacks in Japan. To that end, we have a new tool. We hope users find it useful. We invite feedback.</li>
</ul>


Buybacks are a central part of Corporate Japan's effort to improve corporate/capital governance. Lots of cross-holders want/need to sell. Lots of companies want to reduce excess equity.
This earnings season has seen a LOT of new buybacks announced. ¥7.3trln in the last month and that doesn't even include the biggest buybacks extant by March-end companies.
We are experimenting with new ways of displaying data/analytics for buybacks in Japan. To that end, we have a new tool. We hope users find it useful. We invite feedback.


[Japan Buybacks] ¥7.3trln of Buybacks Announced In the Last Month - Data on Each, Plus History

<ul>
<li>On 12 May, Sankyo Co Ltd (6417 JP) announced a big share buyback worth 13.66% of total issued shares (excluding treasury shares).</li>
<li>Aggregate amount of the purchase cost is up to 60 billion yen (9.7% of its current market cap).</li>
<li>We continue to have a Positive view of Sankyo which continues to demonstrate its commitment to deliver higher shareholder returns through aggressive share buybacks.</li>
</ul>


On 12 May, Sankyo Co Ltd (6417 JP) announced a big share buyback worth 13.66% of total issued shares (excluding treasury shares).
Aggregate amount of the purchase cost is up to 60 billion yen (9.7% of its current market cap).
We continue to have a Positive view of Sankyo which continues to demonstrate its commitment to deliver higher shareholder returns through aggressive share buybacks.


Sankyo Co: Big Buyback + Five Years Left Until Opening of Mega MGM Osaka Integrated Casino Resort

<ul>
<li>On 12 May 2025, <a href="https://www.smartkarma.com/entities/sankyo-co-ltd" target="_blank" data-smartkarma-citation="entities:12385:1" rel="noopener">Sankyo Co Ltd (6417 JP)</a> announced earnings (Revenue -3.7%yoy, OP +1.5%, Net Profit +0.4%) with guidance for March 2026 showing Revs, OP, and NP all falling.</li>
<li>OP and NP would fall 14.4% and 18.5% respectively. The dividend is expected to fall ¥10 to ¥90/share which would be a 41.6% payout ratio.</li>
<li>The company also announced a BIG BUYBACK - Up to ¥60bn buying up to 30.0mm shares (13.66%), starting today and going through 31 March 2026.</li>
</ul>


On 12 May 2025, Sankyo Co Ltd (6417 JP) announced earnings (Revenue -3.7%yoy, OP +1.5%, Net Profit +0.4%) with guidance for March 2026 showing Revs, OP, and NP all falling.
OP and NP would fall 14.4% and 18.5% respectively. The dividend is expected to fall ¥10 to ¥90/share which would be a 41.6% payout ratio.
The company also announced a BIG BUYBACK - Up to ¥60bn buying up to 30.0mm shares (13.66%), starting today and going through 31 March 2026.


[Japan Buyback] Sankyo (6417) - Starts Buying Bigly. Again. Re-Levered It Has A Super-High ROE

APAC IPOs & Placements, Aequitas Research

Nicholas Tan

APAC IPOs & Placements

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.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/metaplanet-inc" target="_blank" data-smartkarma-citation="entities:2130:1" rel="noopener">Metaplanet (3350 JP)</a> is looking to raise around US$1bn from a primary placement.</li>
<li>The deal is a relatively small one, representing 4.8 days of the stock’s three month ADV, despite being 22.8% of total shares outstanding.</li>
<li>In this note, we look at Metaplanet and its peers.</li>
</ul>



Metaplanet (3350 JP) is looking to raise around US$1bn from a primary placement.
The deal is a relatively small one, representing 4.8 days of the stock’s three month ADV, despite being 22.8% of total shares outstanding.
In this note, we look at Metaplanet and its peers.


Metaplanet Placement: A Look at Other Treasury Play Issuances and Performance

Japan

SANKYO CO., LTD. develops, manufactures, and sells pachinko, pachinko slot machines, related parts, and other peripheral devices.  The main products include Fever Zeus Series.  The Company also operates amusement related businesses.

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Sankyo Co Ltd (6417 JP)

Asian Dividend Gems: Sankyo Co

Sankyo is a leading Japanese maker of Pachinko and Pachislot machines. The company has a strong track record of generating positive free cash flow...

Douglas Kim

[Japan Buybacks] ¥7.3trln of Buybacks Announced In the Last Month - Data on Each, Plus History

Japan saw ¥7.3trln of buybacks announced in the March-end earnings season. Here we offer a tool to see them all, and past buyback patterns of each...

Travis Lundy

Sankyo Co: Big Buyback + Five Years Left Until Opening of Mega MGM Osaka Integrated Casino Resort

On 12 May, Sankyo Co announced a big share buyback worth 13.66% of total issued shares (excluding treasury shares). Aggregate amount of the...

Douglas Kim

[Japan Buyback] Sankyo (6417) - Starts Buying Bigly. Again. Re-Levered It Has A Super-High ROE

Sankyo Corp is a good business in an unloved industry. Multiples are low. Cashflows are often great, until they are not. This company is super cash...

Travis Lundy

Metaplanet Placement: A Look at Other Treasury Play Issuances and Performance

Metaplanet is looking to raise around US$1bn from a primary placement. In this note, we look at Metaplanet and its peers.

Nicholas Tan

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