Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

DZT Research

DZT Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Quantitative Analysis

<ul>
<li>We analyzed the changes in margin trading positions of JPX stocks as of Aug 1st. The aggregated net margin trading position is USD16,072m.</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 Tokyo Electron, Advantest, Hitachi, SoftBank, Fujikura, Japan Tobacco, Sumitomo Mitsui Financial, IHI, Shimano, Capcom, Tokyo Electron, Advantest, Hitachi, Softbank, Fujikura, Japan Tobacco.</li>
</ul>


We analyzed the changes in margin trading positions of JPX stocks as of Aug 1st. The aggregated net margin trading position is USD16,072m.
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 Tokyo Electron, Advantest, Hitachi, SoftBank, Fujikura, Japan Tobacco, Sumitomo Mitsui Financial, IHI, Shimano, Capcom, Tokyo Electron, Advantest, Hitachi, Softbank, Fujikura, Japan Tobacco.


JPX Margin Trading Weekly (Aug 1st): Tokyo Electron, Advantest, Hitachi, SoftBank, Fujikura

Japan Specialist

Mark Chadwick

Equity Bottom-Up

<ul>
<li>Shimano beat Q1 profit expectations but stuck to cautious full-year guidance, signalling stabilisation in bike markets rather than a real recovery.</li>
<li>Margins improved, inventories stabilised — but Shimano’s profitability remains well below historic highs, with recovery likely to stay slow and steady.</li>
<li>Strong balance sheet, resilient pricing, limited US exposure: Shimano looks a defensive bet, even if management's guidance ends up on the optimistic side.</li>
</ul>


Shimano beat Q1 profit expectations but stuck to cautious full-year guidance, signalling stabilisation in bike markets rather than a real recovery.
Margins improved, inventories stabilised — but Shimano’s profitability remains well below historic highs, with recovery likely to stay slow and steady.
Strong balance sheet, resilient pricing, limited US exposure: Shimano looks a defensive bet, even if management's guidance ends up on the optimistic side.


<ul>
<li>US tariffs could sharply cut Shimano’s H2 operating profit by up to 57%, despite limited direct exposure, due to opaque supply chains via China and Taiwan.</li>
<li>Valuation would look stretched at 25x EV/EBIT versus historical 20x, if earnings fall short of current guidance.</li>
<li>Shimano’s ¥530bn net cash pile offers room to boost shareholder returns through buybacks or dividends.</li>
</ul>


US tariffs could sharply cut Shimano’s H2 operating profit by up to 57%, despite limited direct exposure, due to opaque supply chains via China and Taiwan.
Valuation would look stretched at 25x EV/EBIT versus historical 20x, if earnings fall short of current guidance.
Shimano’s ¥530bn net cash pile offers room to boost shareholder returns through buybacks or dividends.


Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>The changes to the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a> as part of the March rebalance should be announced in just over 2 weeks. We expect 2-3 changes at the review.</li>
<li>The forecast adds have massively outperformed the forecast deletes and the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei225 Index</a> over every time period going back 3 months with the largest outperformance in the last month.</li>
<li>Positioning appears to be stretched in one forecast add while there appears to be under positioning in a couple of the forecast deletes.</li>
</ul>


The changes to the Nikkei 225 (NKY INDEX) as part of the March rebalance should be announced in just over 2 weeks. We expect 2-3 changes at the review.
The forecast adds have massively outperformed the forecast deletes and the Nikkei225 Index over every time period going back 3 months with the largest outperformance in the last month.
Positioning appears to be stretched in one forecast add while there appears to be under positioning in a couple of the forecast deletes.


Nikkei 225 Index Rebalance: Performance of Potential Adds/Deletes & Positioning

<ul>
<li>
 Cautious but Credible – FY25 guidance underwhelms, but Shimano’s realism is justified. The bike market is recovering, even if 2025 will be a grind.</li>
<li>
 Sitting on a Cash Pile – ¥530 billion in net financial assets, yet capital returns remain restrained. Investors will be watching for bolder moves.</li>
<li>
 Quality Wins – mid-cycle ROIC north of 20% and end-market inventories normalising - a long-term winner at a fair price.</li>
</ul>



 Cautious but Credible – FY25 guidance underwhelms, but Shimano’s realism is justified. The bike market is recovering, even if 2025 will be a grind.

 Sitting on a Cash Pile – ¥530 billion in net financial assets, yet capital returns remain restrained. Investors will be watching for bolder moves.

 Quality Wins – mid-cycle ROIC north of 20% and end-market inventories normalising - a long-term winner at a fair price.


Shimano (7309) | A Slow but Steady Ascent

Japan

SHIMANO INC. manufactures and sells products for bicycling, snowboarding, and fishing.  The Company's products include running gears and brake parts for bicycles and rods, reels, and tackles for fishing.  The Company manufactures golf related products as well.  Shimano mainly exports to Asia, Europe, and the United States.

Price Gauge
52-week Range	0.00 - 0.00
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Shimano Inc (7309 JP)

JPX Margin Trading Weekly (Aug 1st): Tokyo Electron, Advantest, Hitachi, SoftBank, Fujikura

We analyzed JPX margin trading positions report for the past week and highlighted Tokyo Electron (8035 JP), Advantest (6857 JP), Hitachi (6501 JP),...

Ke Yan, CFA, FRM

Shimano (7309) | Coasting, Not Sprinting

Shimano's Q1 profits beat expectations, but cautious full-year guidance suggests a slow recovery in bike markets with margins improving and...

Mark Chadwick

Shimano (7309) | Gears Grinding

US tariffs could significantly impact Shimano's profits due to supply chain exposure, potentially leading to stretched valuation and potential for...

Mark Chadwick

Nikkei 225 Index Rebalance: Performance of Potential Adds/Deletes & Positioning

The forecast adds have strongly outperformed the forecast deletes over the last month. Positioning appears stretched in 1 add while there is under...

Brian Freitas

Shimano (7309) | A Slow but Steady Ascent

Shimano's cautious guidance for FY25 justified by recovering bike market, strong financial position, and quality performance. Investors watching...

Mark Chadwick

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

JPX Margin Trading Weekly (Aug 1st): Tokyo Electron, Advantest, Hitachi, SoftBank, Fujikura

We analyzed JPX margin trading positions report for the past week and highlighted Tokyo Electron (8035 JP), Advantest (6857 JP), Hitachi (6501 JP),...

Ke Yan, CFA, FRM

Shimano (7309) | Coasting, Not Sprinting

​Shimano's Q1 profits beat expectations, but cautious full-year guidance suggests a slow recovery in bike markets with margins improving and...

Mark Chadwick

Shimano (7309) | Gears Grinding

​US tariffs could significantly impact Shimano's profits due to supply chain exposure, potentially leading to stretched valuation and potential for...

Mark Chadwick

Nikkei 225 Index Rebalance: Performance of Potential Adds/Deletes & Positioning

The forecast adds have strongly outperformed the forecast deletes over the last month. Positioning appears stretched in 1 add while there is under...

Brian Freitas

Shimano (7309) | A Slow but Steady Ascent

​Shimano's cautious guidance for FY25 justified by recovering bike market, strong financial position, and quality performance. Investors watching...

Mark Chadwick

Shimano's Q1 profits beat expectations, but cautious full-year guidance suggests a slow recovery in bike markets with margins improving and...

US tariffs could significantly impact Shimano's profits due to supply chain exposure, potentially leading to stretched valuation and potential for...

Shimano's cautious guidance for FY25 justified by recovering bike market, strong financial position, and quality performance. Investors watching...