In today’s briefing:
- Kokusai Electric (6525) – Upcoming Lockup Expiry And BIG Index Demand
- SHIFT (3697) The Next – Potential Big Index Add
- Nikkei 225 Index Rebalance Preview (Mar 2025): SHIFT Splits; Updated Ranking, Capping & Funding
- BayCurrent Consulting (6532) – High Growth, OK Multiple, Big Index Inclusion Coming Up?
- Muji Growing Fast but Not to ¥3 Trillion by 2030
- Aequitas 2025 Asia IPO Pipeline – Japan and South Korea
- BASE Inc (4477 JP): “Shopify of Japan” at 0.8x EV/Sales
- MIRAI Corporation (3476) – Stringent Cost Control and Expansion of Variable Rents for Hotels
Kokusai Electric (6525) – Upcoming Lockup Expiry And BIG Index Demand
- Kokusai Electric (6525 JP) was IPOed in September 2023. The stock was cheap. It rose sharply, tripling in 9 months. At the ATH, the pre-IPO owners launched a HUGE secondary.
- It was like a second IPO. The stock dipped, rallied, plummeted into pricing. Stayed there for two days, and in 6 months, the shares have halved.
- Lockup expiry is next week, and there is a likely large index event in ~10 weeks.
SHIFT (3697) The Next – Potential Big Index Add
- Shift Inc (3697 JP) is a high-growth stock in the software services, testing, consulting, development business. They have a big specialist TAM ahead of them.
- Revenue is up 50-fold in 10 years. OP is up 85-fold in that period. Revenue is guided +17.5% in the year to Aug 2025. OP is guided +28%.
- There is an event coming up shortly which could trigger an imminent index inclusion. It’s worth a look.
Nikkei 225 Index Rebalance Preview (Mar 2025): SHIFT Splits; Updated Ranking, Capping & Funding
- The review period for the Nikkei 225 Index March rebalance ends in 3 weeks. There could be one outright change and one or two others driven by sector balance.
- Shift Inc (3697 JP) will have a 15:1 stock split next week and that puts the stock in the list of potential inclusions over the next couple of rebalances.
- The recent drop in Fast Retailing (9983 JP)‘s stock price will lead to a single step drop in the PAF. That means less passive selling and a smaller funding buy.
BayCurrent Consulting (6532) – High Growth, OK Multiple, Big Index Inclusion Coming Up?
- BayCurrent Consulting (6532 JP) is a high-growth consulting company. This year sees 22% annual revenue growth and 25% OP growth to Feb 2025. Q3 results come out tomorrow.
- The stock has a fairly large and concentrated active institutional holder base, though interestingly, the foreign active insto base is very long-tailed. LOTS of investors hold this.
- The company is likely to see an index inclusion imminently which will over time mean a buy of more than a third of Maximum Real World Float.
Muji Growing Fast but Not to ¥3 Trillion by 2030
- Ryohin Keikaku made a big splash in 2021 when it announced a sales target of ¥3 trillion by 2030, more than a six-fold increase.
- Following a reshuffling of management, targets have been slashed but growth rates still remain impressive with a near doubling of sales by 2030.
- At home, the push into food is working and at last, overseas markets are getting the attention they deserve. The next Uniqlo?
Aequitas 2025 Asia IPO Pipeline – Japan and South Korea
- In this note, we will take a look at the Asia Pacific IPO pipeline for 2025, with a look at Japan & Korea after having looked at HK & India.
- This list has been compiled on a best effort basis from tracking the company filings and through various other sources.
- The deals you see in this note are only a part of our full IPO pipeline tracker. Feel free to drop us a message for additional information on these IPOs.
BASE Inc (4477 JP): “Shopify of Japan” at 0.8x EV/Sales
BASE Inc (4477 JP — US$234 million) is an e-commerce technology company based in Tokyo, Japan.
The software helps small merchants open stores online and manage their operations. BASE is often likened to “Shopify of Japan” due to similarities in their product offerings.
However, investors have become skeptical about BASE, with the stock now trading at just 0.8x EV/Sales — a massive discount to Shopify’s 13.3x.
MIRAI Corporation (3476) – Stringent Cost Control and Expansion of Variable Rents for Hotels
- FP10/24 results exceeded company guidance for net operating income (NOI) and dividend per unit (DPU).
- The notable improvement of NOI (+11.6% vs. FP10/23, +4.8% vs FP4/24) is attributable to a lower expense ratio than initial expectations (actual 32.5%, guidance 34.0%) due to lower rental business expenses and repair costs, higher variable rent on the back of a strong tailwind in the hotel sector (actual ¥173 million vs. guidance ¥149 million), and other one-off rental income.
- Other expenses such as outsourcing costs and utility bills were well controlled, reflecting MIRAI’s asset management ability.
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