Daily Brief Japan: Lifenet Insurance Company, Kawasaki Heavy Industries, Seven & I Holdings, Eiken Chemical, JPY, Japan System Techniques Co, D.Western Therapeutics Institute Inc. and more

• On Friday after the close, Lifenet Insurance Company (7157 JP) announced that it would move to TSE Prime on 25 July 2025. 
• That means it will go into TOPIX on 29 August 2025 at the close. There is a lot to buy. Under the old Quiddity TOPIX Inclusion matrix, it’s super green.
• It also has a very interesting shareholder structure which is worth looking at in detail.

• Kawasaki Heavy Industries (7012 JP) stock price has moved higher over the last few months, and the increased market cap should result in global index inclusion in August.
• Kawasaki Heavy Industries (7012 JP) has underperformed its larger peers, and the stock is trading cheaper than the average of its peers on most metrics. 
• There will be positioning in the stock that has been built up over the last month and a relative value trade could offer better risk reward here.

• Alimentation Couche-Tard just withdrew their offer to buy Seven&i for $47.2bn, and within two days, Seven’s share price is down 12.5% and ACT’s is up 10.6%.
• Seven’s management deluded itself into thinking it could match ACT’s returns by selling off non-core assets. This is pure financial gimmickry, and the market sees right through it.
• Seven will never see a deal as good as the one ACT offered, and failing to capitalize on should be investigated as a potential crime against common sense.

• ACT’s bid for Seven & I has been withdrawn and Seven will be better off long-term because of it – although we detail here how competitors are catching up fast.
• Once York HD has been split off, the company can at last focus on its crucial local CVS operation: Japan makes up 25% of revenues but almost 50% of profits.
• The potential is real and we are bullish on the long-term value but we would have been more bullish if the former CEO Ryuichi Isaka was still on board.

• Noritake – Despite strong profits from semiconductor ceramics, lack of strategy for underperforming segments and idle assets invites activist pressure for structural reform. 
• Square Enix – New turnaround plan lacks clear KPIs and capital discipline, prompting activists to demand sharper execution and improved shareholder returns. 
• Eiken Chemical – Activists gained board influence through compromise, advancing governance reform and signaling momentum toward a potential buyout.

• Default markets are taking a breather and cleansing weak hands, with global fiscal concerns affecting G10 markets.
• Japan’s upcoming upper house elections could impact fiscal situation and yen value.
• Dollar strength has been driven by mixed US data and policy news, with potential for dollar Bears to get a reprieve.

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• Japan System Techniques (hereafter, the Company) announced its full-year FY2025/3 results: Key consolidated figures included net sales of JPY 29,324 mn (+12.0% YoY), operating profit of JPY 3,188 mn (+14.2% YoY), ordinary profit of JPY 3,264 mn (+14.1% YoY), and profit attributable to owners of parent (hereafter, net profit) of JPY 2,443 mn (+17.1% YoY).
• The Company achieved a record high increase in net sales for the 14th consecutive year and operating profit for the 10th consecutive year, with ROE reaching 17.8%.
• The dividend per share for FY2025/3 was JPY 27.0, an increase of JPY 4.5 compared to JPY 22.5 in FY2024/3, an increase for the 4th consecutive year.

• DWTI announced after the close on July 15 that it has decided to add H-1129, an in-house discovered candidate compound, to its pipeline and develop it as a treatment for corneal and conjunctival diseases caused by immune disorders.
• ‘Corneal and conjunctival diseases’ refers to a general term for conditions characterized by inflammation or damage to the cornea and conjunctiva.
• The cornea is the dome- shaped transparent layer covering the iris, pupil and anterior chamber, which focuses and refracts light onto the retina.