In today’s briefing:
- Rakuten Bank (5838 JP) IPO: Listing in April, TPX Inclusion in May, MSCI SC in August
- Rakuten Bank (5838 JP) – Another Net-Bank IPO, This One With TOPIX and Other Index Inclusions
- Japan Banks: Markets Overreact to SVB’s Collapse
- ASICS (7936) | Running Is Recession Proof
- SGX Nikkei 225 Climate PAB Futures: A Cleaner Way to Invest in Japan
Rakuten Bank (5838 JP) IPO: Listing in April, TPX Inclusion in May, MSCI SC in August
- Rakuten Bank (EBANKZ JP)‘s listing has been approved by the JPX and the stock is expected to start trading on the Prime Market from 21 April.
- News reports indicate a raise of US$800mn (JPY 106.8bn) at the mid-point of the IPO range, valuing the company at JPY 305bn (US$2.3bn).
- The stock should be added to the TPX INDEX at the close on 30 May where trackers will need to buy over 14% of the stock issued in the IPO.
Rakuten Bank (5838 JP) – Another Net-Bank IPO, This One With TOPIX and Other Index Inclusions
- Today, Rakuten (4755 JP) and Rakuten Bank (5838 JP) announced that Rakuten Bank had received TSE approval to list (English) on TSE Prime, with expected listing date 21 April 2023.
- This had been in the works since July 2022, and they selected advisors in September 2022. The low end of the offer price range seems attractive. More diligence needed.
- There will be index inclusions. Unlike SBI Sumishin Net Bank (7163 JP) which is going to TSE Standard, Rakuten Bank is going to Prime.
Japan Banks: Markets Overreact to SVB’s Collapse
- Following the collapse of SVB and Signature Bank last week, Japan’s big four banks have fallen by around 15% due to their exposure to US government bonds.
- However, the Japanese banks have managed the interest rate risk far better than the collapsed US banks and therefore, we feel the price drop is unwarranted.
- With Japan likely to scrap its zero rates policy, we think this could be a rather intriguing opportunity to make generous gains on the long side in Japan’s banking sector.
ASICS (7936) | Running Is Recession Proof
- Good news from Nike’s Q3 report, which bodes well for Asics March quarter
- Why was Nike’s stock down? Margins were down 330bps on inventory mark downs
- Running is recession proof according to the footwear makers themselves
SGX Nikkei 225 Climate PAB Futures: A Cleaner Way to Invest in Japan
- SGX has launched futures on the Nikkei Climate 1.5°C Target Index. The index is based on the Nikkei225 and uses screens to remove stocks that do not meet certain criteria.
- The Nikkei Climate 1.5°C Target Index has a high degree of overlap and correlation and low tracking error with the Nikkei 225 (NKY INDEX).
- With increased interest in Climate/ESG investing, market participants can use the SGX-listed futures to get the same risk/reward characteristics as the Nikkei225 with atleast 50% lower Greenhouse Gas emission intensity.
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