In today’s briefing:
- Nissan Motor Placement – Discount Is Enticing but Track Record and Momentum Aren’t Great
- Ashimori Industry (3526 JP): Potential Endgames as Murakami Builds a Stake
- Double Tender Offer Volume of JTC by Affirma Capital (10.4 Million Additional Shares)
- Intel Announces the Potential for Further Dilution by the US Govt Unless It Keeps Fabs
- MHI (7011 JP) Q1 Beat: Record Backlog & Policy Tailwinds Support Premium Valuation
- An Option for Implementing Serious Corporate Governance Reforms to Achieve Results Are…
- Setting Goals Is Key to Achieving Corporate Governance Reform, Rather than the Means to Achieve Them
Nissan Motor Placement – Discount Is Enticing but Track Record and Momentum Aren’t Great
- Mercedes-Benz Pension Trust aims to raise around US$330m via selling its 3.8% stake in Nissan Motor (7201 JP).
- The discount seems enticing, however, the company’s recent share performance and longer term track record aren’t great.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Ashimori Industry (3526 JP): Potential Endgames as Murakami Builds a Stake
- Takateru Murakami, Yoshiaki Murakami’s son, reported a 10.88% ownership ratio in Ashimori Industry (3526 JP). The purchases were from 14 to 18 August, i.e., after the tender offer announcement.
- Takateru Murakami’s average buy-in price of JPY4,134.79 per share is broadly in line with the Toyoda Gosei (7282 JP)‘s JPY4,140 tender offer.
- Murakami’s disclosure suggests three possibilities: 1) force Toyoda Gosei to bump, 2) reach an agreement to rollover its shares into the BidCo or 3) a combination of 1 and 2.
Double Tender Offer Volume of JTC by Affirma Capital (10.4 Million Additional Shares)
- On 25 August, Affirma Capital announced that it will be doubling the tender offer volume of JTC from 10.43 million shares previously to 20.87 million shares (40.4% of outstanding shares).
- Affirma Capital’s stake in JTC will increase from the existing 29.2% to 69.5% after this second tender offer.
- There were a total of 21.5 million international visitors to Japan from January to June 2025, up 21% YoY. This is a record breaking figure.
Intel Announces the Potential for Further Dilution by the US Govt Unless It Keeps Fabs
- Semi-Cap names outperforming an otherwise dreary tape after TSMC announces no Chinese equipment in its 2nm lines for fear of US reprisals
- Yields rose on concerns it’s going to be a ‘one and done’ situation after September cuts
- Trend Micro looking interesting after rebounding off the lows yesterday – with OTC prints possibly pointing to a seller getting cleaned up after 2-months of woeful price action
MHI (7011 JP) Q1 Beat: Record Backlog & Policy Tailwinds Support Premium Valuation
- MHI posted Q1 FY25 revenue +7% and business profit +25% with resilient Energy/Aero margins.
- Orders/Backlog/Guidance: Order intake fell 4% on tough comps, but backlog hit a record ¥10.8 tn (2.1× cover); FY25 guidance of ¥4.95 tn revenue and ¥380 bn profit maintained.
- Valuation/Growth: Shares trade at ~19× FY27E EV/EBITDA vs peers at 10–15×, supported by 5–6% revenue CAGR and ~9–10% EPS CAGR through FY28.
An Option for Implementing Serious Corporate Governance Reforms to Achieve Results Are…
- Companies that have been unable to achieve growth in corporate value and stock price increases need to shift their management thinking toward sustainable growth in corporate value.
- When analyzing 1,793 companies in Metrical Universe by independent director ratio group, companies with an independent director ratio of 50% or more show excellent capital profitability and stock price valuation.
- One option for implementing serious corporate governance reforms in the next revision of the Corporate Governance Code is to raise the standards to a level that cannot be easily manipulated.
Setting Goals Is Key to Achieving Corporate Governance Reform, Rather than the Means to Achieve Them
- Only a few companies fulfill the objectives of Corporate Governance Code. The reason why many fail to achieve them is simply because they do not aim for those goals.
- The reason why many companies could not improve capital profitability can be explained by the fact that they had not made the sustainable expansion of corporate value a management goal.
- Even if a company cannot achieve capital profitability that exceeds its cost of capital, it will not be delisted, so many companies may still be seeing through the TSE’s seriousness.
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