Japan

In today’s briefing:

MHI (7011) | Rockets and Renewables
ROE Isn’t Rising Because Managers Don’t Think of the Value of the Company and Meaning of the Listing
Mizuho – Expect Profit Guidance Surge | JGBs Up, JGBs Unrealized Losses Down | Credit Metrics Better

MHI (7011) | Rockets and Renewables

By Mark Chadwick

MHI reports impressive YoY growth in order intake, revenues, and profits across Energy Systems and Defense Equipment segments in Q2 2023.
Despite a 62% YTD stock price increase, strong order backlog and underlying drivers suggest resilience in a challenging economic climate.
The company benefits from global trends in decarbonization and increased national security spending, positioning itself as a leader in gas turbines and defense technology.

ROE Isn’t Rising Because Managers Don’t Think of the Value of the Company and Meaning of the Listing

Even after the “TSE’s request,” the average P/B of listed companies has not increased. In addition, ROE, which can be considered a driver for corporate value expansion, has remained flat.
Japanese managers tend to be caught up in formalistic thinking about whether or not a company is listed, and whether or not it’s listed on the highest market or not.
Instead of being caught up in formalistic thinking, I would like managers to seriously rethink the value of the company and what it means to be listed.

Mizuho – Expect Profit Guidance Surge | JGBs Up, JGBs Unrealized Losses Down | Credit Metrics Better

By Daniel Tabbush

Mizuho Financial Group (8411 JP) can see higher profit guidance change than many in Japan, the region, given its first quarter was 40% of full-year guidance
Riding JGB yields will support this, with less loans to total financial assets, and the bank has even seen its unrealized losses on JGBs decline. Good ALM.
Credit metrics are better. Its credit costs are in reversal. This can continue or at least remain low. This is supported by granular, macro data.

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Nov 06

Daily Brief Japan: Descente Ltd, Wacom Co Ltd, Saizeriya and more

In today’s briefing:

Descente (8114) : Itochu Still Buying and ANTA Gives You Earnings Hints
Wacom (6727 JP) – Large, Short-Dated, On-Market Buyback Against Dense Register
Saizeriya (7581 JP): Best Pick For Asia/China Restaurant Space

Descente (8114) : Itochu Still Buying and ANTA Gives You Earnings Hints

Descente Ltd (8114 JP) saw Itochu report it had continued its streak of consecutive days of buying, extending it to 115. Now they own 44.1% of voting rights.
ANTA gave hints to the progress of Descente China in the Interim Results, and Q3 Operational Update. Descente analysts are 20% ahead of guidance, but they’re probably low still.
Descente reports Q2 tomorrow. I expect the numbers and presentation to surprise at the Net Profit level. I expect a forecast revision.

Wacom (6727 JP) – Large, Short-Dated, On-Market Buyback Against Dense Register

Wacom splits its pen-tablet business into “Branded Business” and “Technology Solutions” which is not dissimilar to simply splitting based on customer type. TS is doing well. BB is not.
But BB is doing better than it was, which means a rebound in profit this year. After Q2 there is new guidance, probably soft. And there is a BIG buyback.
The buyback is large enough to take notice, even though practically it will be smaller than the headline. And a read of the MTMP “Wacom Chapter 3” is highly recommended.

Saizeriya (7581 JP): Best Pick For Asia/China Restaurant Space

By Steve Zhou, CFA

I continue to believe that Saizeriya is the best pick for gaining exposure to Asia/China restaurant space.
Saizeriya has a very clear business strategy and focus: price. The founder Yasuhiko Shogaki made it clear that price always comes first, and everything else second.
Looking ahead, the runway for growth in China is huge. The company is currently only in 3 cities for a total of 373 stores as of end-FY23 year ending August.

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Nov 05

Daily Brief Japan: Daito Trust Construct, Nikkei 225, Astellas Pharma, TSE Tokyo Price Index TOPIX and more

In today’s briefing:

Daito Trust Construction (1878) – Big Buyback, Dense Register, 120% Payout This Year
EQD | Nikkei 225 (NKY)’s November Rally: How Far Can It GO?
Astellas Pharma (4503 JP): Underwhelming H1 Result; Massive Cut in FY24 Profit Guidance
Valuations Will Rise when the Management Changes To “Maximizing Shareholder Interest”

Daito Trust Construction (1878) – Big Buyback, Dense Register, 120% Payout This Year

Daito Trust last week announced H1 earnings, its 50% dividend payout ratio, and a ¥50bn stock buyback which results in a shareholder payout ratio of ~120% over the next year.
This should help to keep ROE high, and as it is a clear distribution of surplus, it should help keep the multiple up.
It is worth looking at shareholder structure to see how this buyback will be taken.

EQD | Nikkei 225 (NKY)’s November Rally: How Far Can It GO?

By Nico Rosti

The Nikkei closed the month of October down, 4 months down in a row (CC=-4), very OVERSOLD MONTHLY. The 30600 support indicated in our last MONTHLY insight did hold somehow.
We think the Nikkei could continue to rally in November, but this explosive, fast rally, at one point will have to retrace back, before it can continue up.
The index could rally for 2 months, into December. The target prices for the end of the rally are near 34000.

Astellas Pharma (4503 JP): Underwhelming H1 Result; Massive Cut in FY24 Profit Guidance

Astellas Pharma (4503 JP) reported just 0.6% YoY revenue growth to ¥767B in H1FY24, while operating profit plunged 57% YoY and net profit decreased 67% YoY.
Generic competition in Lexiscan impacted topline. Increase in SG&A expenses related to new drug launch and higher amortization of intangible assets, pulled down the operating as well as net profit.
Astellas has downwardly revised FY24 forecasts for profit items by more than 50% after taking into consideration the increases in higher expenses.

Valuations Will Rise when the Management Changes To “Maximizing Shareholder Interest”

The average P/B has remained flat since March end, when TSE requested improvements for companies with P/Bs below 1x, and TOPIX has risen in line with the rise in BPS.
Given the lack of progress in improving ROE, companies have many issues to resolve in improving returns through the appropriate allocation of cash and capital.
Since it’s no longer possible to show early results simply by leaving it to managers, the use of TOB/MBO will be a shortcut to raising shareholder returns and corporate value.

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Nov 04

Daily Brief Japan: Softbank Group, TSE Tokyo Price Index TOPIX, Otsuka Holdings and more

In today’s briefing:

SoftBank Group (9984 JP): Results Preview, Key Topics
Japan Bullishly Inflecting; Constructive Outlook Intact; Global Pullback Likely Over
Otsuka Holdings (4578 JP): Global Products Continue to Shine; Second Consequent 2023 Guidance Raise

SoftBank Group (9984 JP): Results Preview, Key Topics

By Victor Galliano

WeWork appears to be approaching bankruptcy; we expect SoftBank’s exposure to be at least USD1.4bn including credit lines
Arm Holdings post-IPO performance has been lacklustre, but we continue to believe that it remains dangerously over-valued against peers – and Arm provides 30% of the group’s equity value
We believe that JPY depreciation has supported SoftBank Group’s share price (given the high share of USD-denominated portfolio assets); in addition, we still see risks to current private company valuations

Japan Bullishly Inflecting; Constructive Outlook Intact; Global Pullback Likely Over

By Joe Jasper

The MSCI ACWI index ACWI-US briefly fell below major support at $90.50-$91.50, though we do not consider it a “decisive” breakdown and we now see a false breakdown (bullish).
On MSCI ACWI (local currency), a false breakdown appears to already be in place, which is bullish as long as the index does not break to a new low.
MSCI EM (EEM-US) continues to hold above $36.50-$37 support, while MSCI ACWI ex-US (ACWX-US) and EAFE (EFA-US) remain above supports at $45 and $65-$66, respectively. Pullback is likely over.

Otsuka Holdings (4578 JP): Global Products Continue to Shine; Second Consequent 2023 Guidance Raise

During 9M2023, Otsuka Holdings (4578 JP) reported revenue growth of 17% YoY to ¥1,479B, driven by 21% YoY revenue growth in pharmaceutical segment due to 16% growth in global products.
Despite the recording of impairment losses, operating profit increased 77% YoY to ¥203B, leading to a 460 bps expansion of margin to 13.7%. Net profit zoomed 46% YoY to ¥162B.
The company has raised 2023 revenue guidance, second time this year. Otsuka now expects 2023 revenue to grow 14% YoY to ¥1,985B, 4% ahead of prior guidance of ¥1,905B.

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Nov 03

Daily Brief Japan: Kyocera Corp, Keisei Electric Railway Co, CyberAgent Inc, TSE Tokyo Price Index TOPIX, Japan Hotel Reit Investment and more

In today’s briefing:

Kyocera (6971) And Their $10bn KDDI Stake – Did They Get CorpGov Religion?
Keisei Electric: Results Unimpressive, Yet Investor Activism Appeal Remains
CyberAgent: Gaming Shows Some Recovery but New Releases Yet to Shift Momentum for Games
What Is the Path for Resolving the Challenges of Life Insurance Companies’ Policy Shareholdings?
Japan REITs: Long Japan Hotel REIT and Short Nippon Building Fund on Industry Fundamentals

Kyocera (6971) And Their $10bn KDDI Stake – Did They Get CorpGov Religion?

By Shifara Samsudeen, ACMA, CGMA

Yesterday, Kyocera Corp (6971 JP) announced Q2 results and lowered its full-year forecast. Then the CEO said it was “reconsidering” what to do with KDDI shares (after an AGM disaster).
The company had already planned to borrow ¥500bn against the KDDI stake to return capital to shareholders. That was in the price 5+ months ago.
The new hope is that Kyocera just got Corporate Governance Religion. I have my doubts, and even if it did, you have to look carefully at their ambitious plans.

Keisei Electric: Results Unimpressive, Yet Investor Activism Appeal Remains

By Oshadhi Kumarasiri

Keisei Electric Railway Co (9009 JP)‘s FQ2 earnings, released on October-31st, surpassed revenue and OP expectations, yet the company revised down its revenue and OP guidance by ¥8.8bn and ¥200m.
Despite this, the share price has surged over 10% in recent days, likely influenced by activist investor Palliser Capital’s interest and a significant 30% increase in annual dividend guidance.
However, during earnings, the company remained silent about the activist investor’s proposal to reduce its Oriental Land (4661 JP) ownership below 15%.

CyberAgent: Gaming Shows Some Recovery but New Releases Yet to Shift Momentum for Games

CA reported 4Q and full-year FY09/2023 results today. 4Q revenue increased 5% YoY while OP dropped more than 50% during the quarter. Revenues beat consensus while OP fell behind.
Games revenues further decreased YoY during the quarter (improved QoQ) while it managed to report an OP which was possible due to UMA MUSUME’s game anniversary.
Though CA released a new game in September and few lined-up for release, until the company releases a hit title like UMA MUSUME, we expect the recovery to be slow.

What Is the Path for Resolving the Challenges of Life Insurance Companies’ Policy Shareholdings?

It should be noted that some companies that state that they do not possess takeover defenses also indicate that they will take “appropriate measures.”
Addition of ROE and % of independent directors to the approval/disapproval of takeover defense agenda is likely an afterthought to add these conditions to favor the introduction of takeover defense.
It’ll take several years before life insurance companies show signs of change in voting. It’ll be interesting to see how they come to terms with their corporate clients and stewardship.

Japan REITs: Long Japan Hotel REIT and Short Nippon Building Fund on Industry Fundamentals

By Jacob Cheng

In this insight, among the J-REIT universe, we explore the pair trade idea of LONG Japan Hotel REIT and SHORT Nippon Building Fund
Among the real estate subsectors, we expect hotels continue to see superior performance on the back of tourism recovery, while office market will continue to be weak
Both JHR and NBF are large caps with good trading liquidity. In terms of valuation, we see more upside in JHR (20%) than NBF (0%)

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Nov 02

Daily Brief Japan: Hokuhoku Financial Group, Resona Holdings, Daiichi Sankyo and more

In today’s briefing:

Japan H1 Bank Earnings: Interest/Fees Up, Expenses/Credit Costs Down – Opportunity Abounds, Still
Japanese Banks – Nearing the Yield Curve Control End-Game
Daiichi Sankyo (4568 JP): Landmark ADC Deal Pushes FY24 Revenue Guidance Higher

Japan H1 Bank Earnings: Interest/Fees Up, Expenses/Credit Costs Down – Opportunity Abounds, Still

40% of Banks outside the Top 7 (none of which offered H1 guidance) in the TOPIX Banks Index have now changed H1 guidance or reported H1. 2 reported both up.
92% of the others have revised up H1 net income guidance a weighted average of 47%. Net Interest Income, Corporate fees/comms are up, expenses and credit costs are down.
Big tables with data, reasons for guidance changes, and buyback history of each presented below.

Japanese Banks – Nearing the Yield Curve Control End-Game

By Victor Galliano

The latest BoJ adjustment to its yield curve control lifts the hard yield ceiling of 1% on 10 year JGBs, making it “a reference” and allowing yields to exceed it
10 year JGB yields are close to 1%, with Japanese bond yields steepening further which is positive for Japanese banks, especially those with a high share of floating-rate credit exposures
We stick with our positive views on Resona, Mizuho, SMFG and Hachijuni; we add Concordia to our buy list for its high share of floating rate credit exposure

Daiichi Sankyo (4568 JP): Landmark ADC Deal Pushes FY24 Revenue Guidance Higher

Daiichi Sankyo (4568 JP) reported strong H1FY24 results, with double-digit growth in revenue, core operating profit, and net profit, mainly driven by its global mainstay product Enhertu.
Daiichi Sankyo and Merck entered into a global development and commercialization agreement for three of Daiichi Sankyo’s drug candidates, for a total potential consideration of up to $22 billion.
Daiichi Sankyo has raised FY24 revenue, core operating profit, and net profit forecast by 7%, 11%, and 17%, respectively. FY24 revenue is expected to grow 21% YoY to ¥1,550 billion.

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Nov 01

Daily Brief Japan: Socionext, TOPIX-Banks Index, Fanuc Corp, Alfresa Holdings, TSE Tokyo Price Index TOPIX and more

In today’s briefing:

March 2024 Nikkei 225 Rebal – Socionext, Disco and a Consumer Goods Stock (Ryohin Keikaku?) To ADD
Ueda’s BOJ Looking Like Ueda’s Pre-BOJ Opinions, but Normalisation Is “A Work in Progress.”
Fanuc (6954) | Not Out of the Woods Yet
Alfresa Holdings (2784 JP): Better-Than-Expected H1FY24 Performance; FY24 Guidance Raised
Fewer TOPIX Remaining Companies Show the Difficulty of Producing Convincing Disclosures

March 2024 Nikkei 225 Rebal – Socionext, Disco and a Consumer Goods Stock (Ryohin Keikaku?) To ADD

In March 2024 Nikkei 225 Rebal – Look for Zozo, Ryohin Keikaku, and Maybe a Socionext Split I suggested Socionext (6526 JP) needed a stock split to get in.
Today after the close, Socionext reported H1, guided up full-year earnings (still too conservative), raised its div, and announced a 5:1 stock split for Jan1 2024.
DISCO Corp (6146 JP) is now likely to be a top 75, which leaves the question of which Consumer Goods stock would likely be added.

Ueda’s BOJ Looking Like Ueda’s Pre-BOJ Opinions, but Normalisation Is “A Work in Progress.”

In July the BOJ lifted the YCC range to allow flexibility at 0.5% and a red line at 1.0%. Today it moved the “reference” to 1.0% with no red line.
This allows 10yr yields to move higher, but the Board’s insistence on negative rates and YCC staying in place tells you steeper for longer makes shorting long JGBs tough.
The move today helps encourage the market mechanism to take control of dampening volatility, the same way it did when the BOJ stepped away from ETF buying in 2021.

Fanuc (6954) | Not Out of the Woods Yet

By Mark Chadwick

Q2 2023 results for FANUC Group showed a 3.7% decrease in consolidated net sales, a 24.5% drop in consolidated operating income, and mixed performance in its divisions.
Some positives: operating profit exceeding analyst expectations and an operating margin increase to 17.2%. However, declining robot orders, challenges in the US region, and high inventory remain concerns
We believe that the stock is currently trading around fair value (20x EV/EBIT). However, we still see risks to the downside given macro concerns

Alfresa Holdings (2784 JP): Better-Than-Expected H1FY24 Performance; FY24 Guidance Raised

Alfresa Holdings (2784 JP)‘s H1FY24 revenue, operating profit, and net profit are expected to exceed the previous expectations due to greater-than-expected growth in the ethical pharmaceuticals business.
Encouraged by the growth in the pharmaceutical market and better-than-expected H1FY24 performance, the company has raised FY24 revenue, operating profit, and net profit guidance by 4%, 30%, and 36%, respectively.
New FY24 guidance implies, H2FY24 revenue run-rate will be similar to H1F24, while H2FY24 operating profit will accelerate to ¥20.1 billion from ¥15.9 billion in H1FY24.

Fewer TOPIX Remaining Companies Show the Difficulty of Producing Convincing Disclosures

439 companies that will be excluded from TOPIX aren’t expected to face further selling pressure, but 43 companies that remain in TOPIX may have a positive impact in the future.
Only 43 companies (8.9%) succeeded in exceeding 10 billion yen in tradable market capitalization; compared to 22.3% rise in TOPIX, the stock performance of the TOPIX exclusion candidates were lackluster.
These companies with small market capitalizations represent a challenge that has made it difficult for them to attract investor attention and to come up with convincing disclosures.

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Oct 31

Daily Brief Japan: Nippon Electric Glass, Teraoka Seisakusho, Mitsubishi Motors, Panasonic Corp, TSE Tokyo Price Index TOPIX, Nihon M&A Center and more

In today’s briefing:

BIG Nippon Electric Glass (5214) Buyback, Possibly Offset by Cross-Holder Selling
Offensively Low-Priced MBO for Teraoka Seisakusho (4987) – Yet Another SmallCap Governance Disaster
Quiddity JPX-Nikkei 400 Rebal 2024: End-Oct 2023
Panasonic (6752) | Panic-Sonic
Meaningful If “P/B Below 1x” Is a Change of Mindset that Makes Managers Decide to Take an MBO
Nihon M&A: Earnings Show Some Recovery; but Could Miss Full-Year OP Guidance

BIG Nippon Electric Glass (5214) Buyback, Possibly Offset by Cross-Holder Selling

Nippon Electric Glass (5214 JP) is going through a rebuilding year. Lots of restructuring expenses and I expect there will be more.
The company today announced the outline of its next Mid-Term Management Plan for the 5 years to 2028. It will announce details in early Feb 2024 with results.
In that, there is ¥50bn of buybacks through Dec2026, of which ¥20bn will be made in the next 4mos. That is about 11-14% of ADV assuming the price jumps.

Offensively Low-Priced MBO for Teraoka Seisakusho (4987) – Yet Another SmallCap Governance Disaster

A small specialty adhesives maker – Teraoka Seisakusho (4987 JP) has had an MBO proposed and approved. At 0.54x book. NetCash+securities+2.5mos of net A/R+inventory = 99% of Takeover Market Cap.
Borrow 2x EBITDA, pay out the cash and securities, and this is being done at <0.3x remaining book. The takeover is 100+% bank funded. It’s ridiculous.
For this to get stopped, however, someone has to go activist on a smallcap where retail owns the entire float and friends and family own 55% to start.

Quiddity JPX-Nikkei 400 Rebal 2024: End-Oct 2023

By Janaghan Jeyakumar, CFA

JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the potential forward inclusions and removals every month.
Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in August 2024 based on trading data as of end-October 2023.

Panasonic (6752) | Panic-Sonic

By Mark Chadwick

Panasonic’s Q2 results showed flat consolidated sales of Y2,090 billion, with a 24% YoY increase in adjusted operating profit.
FY3/24 outlook was revised down with sales and operating profit reductions across segments, notably in Lifestyle and Energy
Our concerns include the company’s complex structure, low overall profitability, uncertainties about valuing IRA credits, and challenges stemming from economic conditions, leading to pessimism about Panasonic’s stock price

Meaningful If “P/B Below 1x” Is a Change of Mindset that Makes Managers Decide to Take an MBO

By Shifara Samsudeen, ACMA, CGMA

Although it’s important that the quality of companies be maintained and improved through metabolism, the number of listed companies has consistently increased due to the many IPOs and few delistings.
Many founders used IPOs as a tax-saving measure, and many managers were not thoughtful enough to increase shareholder profits, which is why there were many IPOs and few delistings.
Delisting through MBO or TOB for parent and subsidiary listed subsidiaries is much more effective than “TSE request” in reducing the number of companies with P/B below 1x.

Nihon M&A: Earnings Show Some Recovery; but Could Miss Full-Year OP Guidance

Nihon M&A Center (2127 JP) ’s 2Q revenues decreased YoY while OP remained flat. However, both revenue and OP beat consensus estimates driven by improvement in revenue per M&A transaction.
There was strong improvement in revenue per transaction driven by enhanced efforts and growth in no. of large deals, however, M&A revenues declined due to drop in no. of deals.
Nihon has so far achieved only 36% of its OP target and it seems unlikely for the company to reach its full-year OP guidance, suggesting there is further downside.

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Oct 30

Daily Brief Japan: Kenedix Office Investment Co, Nikkei 225, JSR Corp, M3 Inc and more

In today’s briefing:

KDX (8972) – The Kenedix REIT Merger After a Disastrous Index Inclusion Trade
EQD | If the Nikkei Begings to Rally, Where Will It Encounter Resistance?
Merger Arb Mondays (30 Oct) – JSR, Eoflow, Azure Minerals, Symbio, Hollysys, Haitong Intl
M3: Margins Continue to Dip and Likely to Miss Full Year Guidance

KDX (8972) – The Kenedix REIT Merger After a Disastrous Index Inclusion Trade

By Shifara Samsudeen, ACMA, CGMA

The merger between Kenedix Office Investment Co (8972 JP), Kenedix Retail REIT (3453 JP), and Kenedix Residential Investment (3278 JP) is done. Newco starts trading this week as KDX.
The trade was fine until I wrote 9 days ago there was still room to run. It fell the next day, bounced 3%, then got CRUSHED into the index upweight.
NEWREIT is now as cheap relative to its Pro-Forma Peer Group as it was at announcement.

EQD | If the Nikkei Begings to Rally, Where Will It Encounter Resistance?

By Nico Rosti

Last week, the Nikkei closed down at 30991.69 (CC=-2). The index’s sell-off could end in November, marking a temporary bottom from which a rally could start.
MRM models say that if the Nikkei bounces this week, it could rise for 3 weeks and reach a price area between 31624 (Q3/CC=+1) and 32892 (Q3/Gen.Pattern Boxplot).
The upcoming rally comes as a reaction to quite OVERSOLD conditions, as previously discussed, but could be followed by another pullback. This insight points to where the rally may end.

Merger Arb Mondays (30 Oct) – JSR, Eoflow, Azure Minerals, Symbio, Hollysys, Haitong Intl

By Arun George

We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
Highest spreads – 111 Inc (YI US), Eoflow (294090 KS), Hollysys Automation Technologies (HOLI US), Symbio Holdings (SYM AU), JSR Corp (4185 JP), Healius (HLS AU), Haitong International.
Lowest spreads – Pact Group Holdings (PGH AU), Origin Energy (ORG AU), Chindata Group (CD US), Allkem Ltd (AKE AU), T&K Toka Co Ltd (4636 JP), Azure Minerals (AZS AU).

M3: Margins Continue to Dip and Likely to Miss Full Year Guidance

M3 Inc (2413 JP) reported 2QFY03/2023 results on Friday. Revenues increased 3.0YoY while OP decreased 7.1% YoY, both revenues and OP fell below consensus estimates by 0.2% and 4.7% respectively.
Medical Platform’s earnings continue to deteriorate while we are yet to see a meaningful improvement in overseas segment’s earnings to drive the next phase of growth for m3.
Given continued decrease in profits, we think the company will struggle to meet its full-year guidance suggesting there is further downside to m3’s share price.

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Oct 29

Daily Brief Japan: GMO Payment Gateway, Kokusai Electric , TSE Tokyo Price Index TOPIX and more

In today’s briefing:

Index Rebalance & ETF Flow Recap: KS200, KQ150, Yuanta Div+, LIT, HSCI, IDX, Japan Positioning
ECM Weekly (29th Oct 2023) – Kokusai, J&T, Midea, Wuxi XDC, Cirrus, Cello World, Honasa, SIA
% of Female Board Members Asks “Seriousness” Of Improving Profitability and Governance Etc.
Only 20% of Current CEOs in Japan Expected to Have a Female CEO Within 10 Years

Index Rebalance & ETF Flow Recap: KS200, KQ150, Yuanta Div+, LIT, HSCI, IDX, Japan Positioning

By Brian Freitas

The coming week has a lot of review periods ending – KOSPI 200, KOSDAQ 150, CSI 300, CSI 500, SSE50, STAR50, ChiNext and SENSEX, among others.
The TOPIX rebalance will be implemented on Monday while the Global X Lithium & Battery Tech ETF (LIT US) and IDX indices will rebalance at the close on Tuesday.
There were outflows from Emerging Market ETFs including iShares Emerging Markets (EEM), iShares Core Emerging Mar (IEMG), Schwab Emerging Markets Equi (SCHE) and IShares Edge Min Vol Emerging Markets ETF (EEMV).

ECM Weekly (29th Oct 2023) – Kokusai, J&T, Midea, Wuxi XDC, Cirrus, Cello World, Honasa, SIA

By Sumeet Singh

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
In the IPO space, Kokusai Electric (6525 JP) provided some relief in the ECM space, even as J&T Global Express (1519 HK) didn’t do much.
Given the earnings seasons, there weren’t any placement during the week. We did look at Singapore Airlines (SIA SP)‘s upcoming placement lockup expiry.

% of Female Board Members Asks “Seriousness” Of Improving Profitability and Governance Etc.

While necessary talent should be sought from both outside and inside the company, it is not good for the company’s future if the most of internal executive directors are male.
The appointment of women and foreign board members is an effective way to transform the board of directors to ensure transparency and objectivity, without compromising the traditional atmosphere of familiarity.
Companies with a higher percentage of female board members tend to be more proactive in their corporate governance practices and more diligent about improving profitability and stock valuation.

Only 20% of Current CEOs in Japan Expected to Have a Female CEO Within 10 Years