Japan Experts, Extraordinary Performance, Astris Advisory Japan

Astris Advisory Japan

Japan Experts, Extraordinary Performance

Our Corporate Advisory service is designed to give clients access to a wider range of investors. These include Japan specialists as well as global investors. The goal is to help achieve a fair equity valuation.

Equity Bottom-Up

<ul><li>Q1-4 FY12/23 results were weaker than our estimates with the company revising down FY guidance.</li><li>Orders for the mainstay electric discharge machines fell 24% YoY in Q4 FY12/23 with China demand remaining sluggish.</li><li>However, there are positive indications that the company aims to transform its business model by conducting cost reductions, streamlining the balance sheet, and bringing greater focus to its business strategy. </li></ul>

Q1-4 FY12/23 results were weaker than our estimates with the company revising down FY guidance.Orders for the mainstay electric discharge machines fell 24% YoY in Q4 FY12/23 with China demand remaining sluggish.However, there are positive indications that the company aims to transform its business model by conducting cost reductions, streamlining the balance sheet, and bringing greater focus to its business strategy. 

Sodick (6143) - Aiming to Revitalize the Business Model

<ul><li>Major change of gameplan – Q1-3 FY12/2023 results were weaker than expected with the company revising down FY guidance, and withdrawing both current medium and long-term plans given highly challenging business conditions.</li><li>An overview plan of structural reforms has been unveiled, focusing on becoming a more resilient and profitable business, realigning product lines, and rebuilding sales and production setups.</li><li>Although an ambitious initiative with a wide scope, we believe that this will have a positive impact of significantly accelerating transformation initiatives, and transitioning the company to a more optimal business model.</li></ul>

Major change of gameplan – Q1-3 FY12/2023 results were weaker than expected with the company revising down FY guidance, and withdrawing both current medium and long-term plans given highly challenging business conditions.An overview plan of structural reforms has been unveiled, focusing on becoming a more resilient and profitable business, realigning product lines, and rebuilding sales and production setups.Although an ambitious initiative with a wide scope, we believe that this will have a positive impact of significantly accelerating transformation initiatives, and transitioning the company to a more optimal business model.

Sodick (6143 JP) - Revisiting the Strategy and Accelerating Structural Reforms

<div><div><div><div><ul><li>Digging in for the duration – continuing weak demand from China contributed significantly to weak Q1-2 FY12/2023 numbers, with sales declining 14.8% YoY and resulting in an operating loss.</li><li>The key issue is that customers are experiencing low utilization rates at production facilities, and hence do not require new capacity.</li><li>Sodick revised its guidance for FY12/2023, with expectations of similar market conditions persisting into H2 FY12/2023. </li></ul></div></div></div></div>

Digging in for the duration – continuing weak demand from China contributed significantly to weak Q1-2 FY12/2023 numbers, with sales declining 14.8% YoY and resulting in an operating loss.The key issue is that customers are experiencing low utilization rates at production facilities, and hence do not require new capacity.Sodick revised its guidance for FY12/2023, with expectations of similar market conditions persisting into H2 FY12/2023. 

Sodick (6143) - Aiming to Steer Through Current Circumstances

Executive Director, Metrical Inc

Aki Matsumoto

Executive Director

Independent Leading Corporate Governance Research

Metrical Inc

METRICAL INC. is an independent leading Corporate Governance research firm in Japan where Corporate Governance is increasingly recognized as an important element on corporate management in these days. Thus, CG research and solutions would become an essential component of global capital markets and play important to contribute to transparency of the markets and maximize shareholders’ value in Japan. 

METRICAL INC. provides Corporate Governance research and analysis including rating services, and  also offers investment research and IR services with solutions and customized profound research on CG and IR issues.

<ul>
<li>There has been no end to the tragic incidents of people losing their lives due to long working hours. I will try to think about this case.</li>
<li>I believe this issue is not just a matter of how to work, but also a human rights issue that calls into question whether we are treating employees as human.</li>
<li>The "S" in ESG does not refer to each issue, but rather to how seriously the company addresses and tackles the fundamental human rights issue first.</li>
</ul>


There has been no end to the tragic incidents of people losing their lives due to long working hours. I will try to think about this case.
I believe this issue is not just a matter of how to work, but also a human rights issue that calls into question whether we are treating employees as human.
The "S" in ESG does not refer to each issue, but rather to how seriously the company addresses and tackles the fundamental human rights issue first.


Japan's Governance: Human Rights and Long Working Hours Issues: Sodick (6143)

Director, Pearl Hill Advisors

Nicholas Tanner

Director

Pearl Hill Advisors

<p><strong>Forecasts are conservative, the shares are on about 11x this and it looks to us that profits will continue to grow over the next 2 years. There is a chance that some of the 12% outstanding it owns in itself may be cancelled as well. We are happy to buy the shares here. </strong></p><p>70% of Sodick’s sales are electro-discharge machines (EDM’s). These are used to make molds or die casts, in particular plastic molds for very small and sophisticated products. The company has a 30% global share competing with…</p>

Forecasts are conservative, the shares are on about 11x this and it looks to us that profits will continue to grow over the next 2 years. There is a chance that some of the 12% outstanding it owns in itself may be cancelled as well. We are happy to buy the shares here. 70% of Sodick’s sales are electro-discharge machines (EDM’s). These are used to make molds or die casts, in particular plastic molds for very small and sophisticated products. The company has a 30% global share competing with…

Japan

Sodick Co., Ltd. develops, manufactures, and sells electric machines and equipment.  The Company's product line includes computerized numerical control electrical discharge machine (EDM), super high precision wire cut EDM, CAD/CAM system for mold design and production, injection molding machine, and high speed manual drilling machine.

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Sodick Co Ltd (6143 JP)

Sodick (6143) - Aiming to Revitalize the Business Model

Q1-4 FY12/23 results were weaker than our estimates with the company revising down FY guidance. Orders for the mainstay electric discharge machines...

Astris Advisory Japan

Sodick (6143 JP) - Revisiting the Strategy and Accelerating Structural Reforms

Q1-3 FY12/2023 results were weaker than expected with the company revising down FY guidance, and withdrawing both current medium and long-term...

Astris Advisory Japan

Sodick (6143) - Aiming to Steer Through Current Circumstances

Digging in for the duration – continuing weak demand from China contributed significantly to weak Q1-2 FY12/2023 numbers, with sales declining...

Astris Advisory Japan

Japan's Governance: Human Rights and Long Working Hours Issues: Sodick (6143)

There are many companies that mention work-life balance in the ESG statements. I think it is important to seriously address the fundamental issue...

Metrical Inc

Sodick (6143) - Still a BUY

Forecasts are conservative, the shares are on about 11x this and it looks to us that profits will continue to grow over the next 2 years. There is...

Pearl Hill Advisors

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