Daily BriefsJapan

Japan: Hitachi Transport System, Mitsui O.S.K. Lines, Hitachi Construction Machinery, Skylark Co Ltd and more

In today’s briefing:

  • Hitachi Transport System (9086) – Not a Clear Outcome But Interesting Possibilities
  • Mitsui OSK Lines Bear Impulse
  • Japan’s Governance: Hitachi Construction Machinery: Additional Notes and Ownership Factor
  • Skylark Holdings (3197): Earnings Forecast Update in Light of Omicron Outbreak

Hitachi Transport System (9086) – Not a Clear Outcome But Interesting Possibilities

By Travis Lundy

  • Hitachi is, as the media fuss suggests, in the last stages of its re-formation after ridding itself of nearly two-dozen listed subs over the last decade-plus.
  • Hitachi Transport System (9086) is the last major sub/affiliate without a new home. Hitachi owns just under 40%. SG Holdings (9143 JP) owns just under 10%. Both want to sell.
  • It is not clear HTS wants to be taken private, but there could be an interesting financial engineering solution to suit the sellers. 

Mitsui OSK Lines Bear Impulse

By Thomas Schroeder

  • Mitsui OSK Lines impulsive decline as sell volumes rise is a big negative and sets up a short on a bounce, which may be limited.
  • 8,500 is near resistance. 7,000 is tactical support (trendline) where a reaction rise is due. Watch RSI near/below 30 for a short term low.
  • Major support at 6,500 targeted representing key dual lows, 200 dma and congestion support.

Japan’s Governance: Hitachi Construction Machinery: Additional Notes and Ownership Factor

By Aki Matsumoto

  • More important than the continuity of the Hitachi brand is how HCM can increase the competitive advantage of its products and how quickly it can respond to changes in market.
  • Changes in major shareholders and the presence of major shareholders have been shown to have statistically significant correlations in ROA, Tobin’s q (and changes in market capitalization).
  • The existence of the Ownership factor doesn’t necessarily predict the future of HCM, but in construction equipment market with strong competition, having a reliable partner is encouraging in business decisions.

Skylark Holdings (3197): Earnings Forecast Update in Light of Omicron Outbreak

By Mita Securities

  • We are updating our earnings forecasts for Skylark Holdings (3197, the company) in light of its 3Q FY12/21 results
  • Earnings forecast for FY12/22 and beyond: Moderate recovery
  • Our target price is equivalent to 34.2x our FY12/24 EPS forecast of 46.85 yen.

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