In today’s briefing:
- Nikkei 225 Index Rebalance Sep25: Performance of Potential Adds/Deletes & Positioning
- Ibiden Q1 FY25: Strong Beat, Upgraded Outlook, Attractive Valuation
- JX Advanced Metals – Q1 FY2025: Strong Beat, Guidance Raised, Valuations Supportive
- How Effective Will the Changes in Listing Criteria Be, Amid a Long Grace Period and Secured Listing?
Nikkei 225 Index Rebalance Sep25: Performance of Potential Adds/Deletes & Positioning
- The changes to the Nikkei 225 (NKY INDEX) as part of the September rebalance should be announced in just over 2 weeks. We expect 2 changes at the review.
- BayCurrent Consulting‘s PAF will double, Fast Retailing‘s CPAF will stay the same, and Sony Financial Group will be deleted from the index following its spinoff from Sony Corp (6758 JP).
- Sanrio (8136 JP)‘s improved liquidity increases the probability of index inclusion, and the stock could be added to the index at the next rebalance if it misses in September.
Ibiden Q1 FY25: Strong Beat, Upgraded Outlook, Attractive Valuation
- Results: Q1 FY25 sales grew +10.5% YoY with OP surging +56%, led by AI/data-center substrate demand and margin gains.
- Earnings Upgrade & Outlook: FY25–27 EPS/EBITDA raised 9–12% on stronger substrates and resilient ceramics, implying ~18–19% CAGR ahead.
- Valuations: Trading at 21× FY25E P/E and 5.9× EV/EBITDA, Ibiden offers structural growth at compressed multiples versus AI peers.
JX Advanced Metals – Q1 FY2025: Strong Beat, Guidance Raised, Valuations Supportive
- Results: Q1 FY25 revenue rose 12% YoY to ¥191.3bn with operating profit up 22% and net profit up 33%, driven by robust semiconductor and ICT materials growth.
- Guidance & Revisions: FY25 guidance lifted to ¥760bn revenue/¥110bn OP; dividend ¥18. Our forecasts rise to PAT ¥70bn (+35%) in FY25, with 30–40% upgrades through FY26–28.
- Valuations: At ~13x P/E and ~12x EV/EBITDA, JX trades above domestic miners but below semiconductor materials peers, leaving room for rerating if the advanced materials mix deepens.
How Effective Will the Changes in Listing Criteria Be, Amid a Long Grace Period and Secured Listing?
- Companies with market capitalization of under 10 billion yen will be given long grace period. Considering inflation and long grace period, this seems not such a difficult hurdle to overcome.
- If it becomes easy to meet the new standards, the growth market may not change much from the current situation, where many companies with limited growth potential remain.
- Even though there’re measures to enable companies to move to standard market if things don’t work out, it’s questionable how many companies will seriously pursue measures to increase market capitalization.
💡 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
