In today’s briefing:
- Nikkei 225 Index Rebalance: Baycurrent (6532) Replaces Mitsubishi Logistics (9301); Kokusai Elec👎
- Nikkei 225 Mar25 Rebal: BayCurrent (6532) IN, Mitsubishi Logi (9301) OUT (Re-IPO). Kokusai MIA
- Big Gap Between Companies that “don’t Have a Gap in Investors’ Viewpoints” and Those that Don’t
- Geechs (7060 JP) – IT Freelance Matching Business (Overseas)
- Dydo Drinco Inc (2590 JP): Full-year FY01/25 flash update
Nikkei 225 Index Rebalance: Baycurrent (6532) Replaces Mitsubishi Logistics (9301); Kokusai Elec👎
- In a big surprise, there is only one change for the Nikkei 225 (NKY INDEX) in March with BayCurrent Consulting (6532 JP) replacing Mitsubishi Logistics (9301 JP).
- The non-inclusion of Kokusai Electric (6525 JP) is a big surprise given that the stock was ranked among the top 75 stocks by liquidity. There could be selling near-term.
- BayCurrent Consulting (6532 JP) has been added at a 0.5 PAF and that will increase to 1 in September. Fast Retailing (9983 JP) could be capped yet again in September.
Nikkei 225 Mar25 Rebal: BayCurrent (6532) IN, Mitsubishi Logi (9301) OUT (Re-IPO). Kokusai MIA
- The March 2025 Nikkei 225 Average Review was announced last night. Something of a disaster for Team Quiddity. I had expected 2-3 ADDs and 2-3 DELETEs.
- We got only one change, and that was my second choice ADD and second choice DELETE. Top 75 name Kokusai Electric (6525 JP) was missing in action. BIG Disappointment. 🤔
- BayCurrent Consulting (6532 JP) is in at a PAF of 0.5, with an upweight end-Sep. Mitsubishi Logistics (9301 JP) is OUT. Fast Retailing (9983 JP) will see US$2.3bn of sells.
Big Gap Between Companies that “don’t Have a Gap in Investors’ Viewpoints” and Those that Don’t
- A common feature of the three companies that clearly indicated the conditions for implementing share repurchases and their position in the cash allocations is high foreign ownership.
- Japanese companies’ share buybacks are less than 10% of net income, but on a cash flow basis, taking depreciation into account, share buybacks would be much less.
- If the cost of capital was calculated, it shouldn’t be tremendous requirement to indicate cash allocation and share repurchase terms necessary for targeted return on capital and corporate value.
Geechs (7060 JP) – IT Freelance Matching Business (Overseas)
- On February 14, 2025, Geechs Inc. (hereafter, “the Company”) announced its Q3(9M) FY2025/3 earnings results.
- Net sales rose 5.2% YoY to JPY 18,705 mn, EBITDA rose 67% YoY to JPY 440 mn, and operating profit rose 503% YoY to JPY 348 mn.
- This reflected steady growth in the core IT freelance matching business (Japan), reduced losses in the IT freelance matching business (Overseas), improved profitability in the Seed Tech business, and an end to losses from G2 Studios (formerly the Game business) following its sale at the end of FY2024/3.
Dydo Drinco Inc (2590 JP): Full-year FY01/25 flash update
- Revenue for FY01/25 was JPY237.2bn (+11.2% YoY), with operating profit at JPY4.8bn (+28.3% YoY).
- Domestic Beverage business saw a revenue decline of 4.0% YoY to JPY145.5bn due to lower sales volume.
- International Beverage business revenue increased 112.8% YoY to JPY56.3bn, driven by Turkish operations and Wosana consolidation.
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