In today’s briefing:
- TOPIX Inclusions: Who Is Ready (Feb 2025)
- WellNeo Sugar (2117) To Buy Toyo Sugar (2107) – Too Cheap, No Synergies Paid, but Too Small
- Yamaha Corp (7951) BIG Buyback May Be Followed By More Later
- Crooz Sells Online Mall Business to Korea’s Nugu
- Tokyo Electron (TEL): Maintains Its FY25 Guidance and Provides a Cautious 2025 Outlook
- Mercari (4385) | Profitability on the Rise with More Levers to Pull
- Allegro MicroSystems: The E-Mobility, ADAS Integration & Other Major Growth Drivers
- Gamecard Joyco Holdings (6249 JP): Q3 FY03/25 flash update
- Tokyo Electron (8035 JP): Q3 FY03/25 flash update
- GMO Pepabo Inc (3633 JP): Full-year FY12/24 flash update
TOPIX Inclusions: Who Is Ready (Feb 2025)
- Quiddity’s “Who is Ready” series of insights aims to objectively identify names listed on the Tokyo Stock Exchange that are potential additions to the TOPIX Index in future.
- Japan Eyewear Holdings (5889 JP) and Core Concept Technologies Inc (4371 JP) continue to be in our watchlist of pre-event candidates for TOPIX Inclusions.
- Separately, the TOPIX Liquidity factor removal event will take place in April 2025 and there could be some positive index flows for Tokyo Metro (9023 JP) during this event.
WellNeo Sugar (2117) To Buy Toyo Sugar (2107) – Too Cheap, No Synergies Paid, but Too Small
- WellNeo Sugar (2117) today announced a deal to buy Toyo Sugar Refining (2107 JP) at a 27% premium. This is a small ¥11bn deal where insiders own 45%.
- Normally I wouldn’t even talk about a deal this small but this one has something going for it. Two things actually.
- And readers will have to read all the way down to the conclusions to find out the key one, but the setup is that it is too cheap.
Yamaha Corp (7951) BIG Buyback May Be Followed By More Later
- Yesterday, Yamaha Corp (7951 JP) announced Q3 earnings (results, presentation, metrics), a change in full-year guidance (revs unch’d, OP -10.8%, NP -25%), and a large buyback.
- 9M Revenue up yoy but China sales slower OP up yoy (audio business, SG&A cuts), but FY revised lower due to restructuring (impairment, retirement expenses). Looks worse than it is.
- The buyback is interesting, and large. And investors should be aware of the modalities.
Crooz Sells Online Mall Business to Korea’s Nugu
- Crooz’s Shop-list.com used to be one of the fastest growing online fashion malls in Japan but, just before Covid, it hit a wall and hasn’t recovered since.
- Now it will be merged with Korean fashion mall, Nugu, and its real value as a database of young female consumers will become clear.
- This should help Nugu grow to GTVs of ¥100 billion from Japan alone but will leave Crooz as a small bit player in digital services.
Tokyo Electron (TEL): Maintains Its FY25 Guidance and Provides a Cautious 2025 Outlook
- Cautious 2025 outlook: SEAJ and other Japanese SPE firms have toned down 2025 expectations. TEL mentions a flat total end-demand.
- In 2024, spending was concentrated in leading edge (AI) and China. In 2025, Intel and Samsung Logic Capex declines, China should decline. The bright spots are TSMC and HBM Capex.
- Consensus expectations are low, but rightly so. The stock is at average PEx. Neutral territory.
Mercari (4385) | Profitability on the Rise with More Levers to Pull
- Record Margins: Q2 OP surged 82% YoY to ¥7.1b, with Japan profitability up and losses narrowing in Fintech and the US.
- US Breakeven Play: Aggressive cost-cutting led to 12ppt margin improvement; if growth stalls, a sale or exit could boost margins by 200bps.
- Fintech Upside: Losses peaked last year, with 16ppt OPM improvement; breaking even could add 400bps to group margins.
Allegro MicroSystems: The E-Mobility, ADAS Integration & Other Major Growth Drivers
- Allegro MicroSystems reported third-quarter fiscal year 2025 revenues of $178 million, exceeding the midpoint of its guidance.
- The company posted a non-GAAP earnings per share of $0.07, also above the anticipated outlook.
- Despite these accomplishments, the company’s quarterly sales declined 5% sequentially and 30% year-over year.
Gamecard Joyco Holdings (6249 JP): Q3 FY03/25 flash update
- Sales increased by 11.0% year-on-year, reaching JPY31.9 billion, according to Shared Research based on company data.
- Operating profit decreased by 7.8% year-on-year to JPY8.4 billion, with recurring profit also down by 6.4%.
- Net income attributable to owners of the parent fell by 3.9% year-on-year, totaling JPY6.1 billion.
Tokyo Electron (8035 JP): Q3 FY03/25 flash update
- Cumulative Q3 FY03/25 revenue was JPY1.78tn (+38.4% YoY), with operating profit at JPY513.5bn (+65.1% YoY).
- Full-year forecast for FY03/25 revised: revenue JPY2.40tn, operating profit JPY680.0bn, net income JPY526.0bn.
- New SPE sales forecast: JPY1.83tn, with logic foundry JPY1.17tn, non-volatile memory JPY119.6bn, DRAM JPY545.1bn.
GMO Pepabo Inc (3633 JP): Full-year FY12/24 flash update
- Full-year FY12/24 revenue increased YoY, driven by price revisions in recurring revenue businesses and reduced bad debt expenses.
- FY12/25 forecast expects revenue growth from price revisions and high-priced plans, with a dividend increase to JPY67.0/share.
- New medium-term policy targets FY12/27 revenue of JPY12.6bn and operating profit of JPY1.26bn, with increased payout ratio.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
