Daily Brief Japan: Capcom Co Ltd, BASE Inc, Yaskawa Electric and more

In today’s briefing:

Nikkei 225 Index Rebalance: Capcom (9697 JP) Gets a Boss-Level Upgrade

JX Advanced Metals (5016), Kokusai Electric (6525) and Capcom Co Ltd (9697) replace Konica Minolta (4902), Archion (543A) and Kanadevia (7004) in the Nikkei 225 Index.
With the new methodology, the index committee appears to be focused on adding stocks with high liquidity and restoring sector balance to align the index with the methodology.
With sector imbalance still rife, there could be 3 more changes for the index in March with more inclusions from the Information and Communications sector likely.

On 28 August, BASE Inc (4477 JP) announced an offer by SBI Holdings (8473 JP) to acquire up to 23.8m shares (20.00% stake) at JPY340, a 7.6% premium to the undisturbed price.
There is no minimum acceptance condition. The shares are trading above the offer price, either due to expectations of a bump or to the SBI alliance benefiting the back-end valuation.
A price bump is likely as the offer is light on several metrics, the two substantial shareholders are unlikely to tender, and the Board has taken a neutral stance.

Physical AI optionality: Yaskawa’s ¥250bn investment plan and humanoid strategy position its servo, drive and actuator businesses to benefit from the Physical AI growth cycle.
Earnings inflection: Management targets ¥650bn revenue and ¥90bn OP by FY2029, with margins improving toward 15% as AI robotics and data-center demand ramp.
Attractive risk/reward: Shares are down 40% from their YTD high and trade below historical multiples, offering ~33% upside, though humanoid adoption and FA capex remain key risks.

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