In today’s briefing:
- Kito (6409) Shareholder Register Getting Interestinger
- Sony – State Of Play Highlights VR Ambitions
- Cautiously Optimistic Following Downtrend Reversals; Japan Continues to Lead; Bottoms-Up Stock Rec’s
- A Pair Trade of Japanese General Trading Companies: Long Marubeni & Short Itochu
Kito (6409) Shareholder Register Getting Interestinger
- In mid-May 2022, Kito Corporation (6409 JP) announced KKR would launch a Tender Offer to buy out the company at a big premium. I warned about the register.
- Two large shareholders were there prior to the bid – one “engagement-style” activist and one private company in a similar industry. Both had a 9+% holding visible.
- Both have now lifted their stakes above 10% post-announcement, at a small spread to terms. This makes things more interesting.
Sony – State Of Play Highlights VR Ambitions
- Sony’s State of Play today highlighted a variety of games headlined by Capcom’s Street Fighter 6 and Resident Evil 4 Remake and Square Enix’s Final Fantasy 16.
- The title line-up was strong but the standout in our view was the degree of support Sony appears to be getting for PSVR2.
- We had commented on this previously but it is increasingly looking like a key differentiating factor for PlayStation and no longer a gimmick.
Cautiously Optimistic Following Downtrend Reversals; Japan Continues to Lead; Bottoms-Up Stock Rec’s
- The bear market rally that we were on watch for started last week, confirmed by the bullish reversals on the DAX, Hang Seng, MSCI China (MCHI-US), and China Internet (KWEB-US).
- Is this just another bear market rally, or will indexes are able to make a higher low and start a new bull market? Either way, it’s a start.
- We highlight attractive stocks from a bottoms-up perspective, spanning several Sectors. Over half hail from Japan, where the TOPIX Small index is reversing its downtrend.
A Pair Trade of Japanese General Trading Companies: Long Marubeni & Short Itochu
- We discuss a pair trade among the major Japanese trading companies. We propose going long on Marubeni Corp and going short on Itochu.
- We believe Marubeni has one of the most attractive valuations among the five major Japanese trading companies in terms of ROE vs. P/B and Itochu is the least attractive.
- We like Marubeni’s strength in food and agri businesses. Itochu is more dependent on metals, minerals and energy sectors which tend to be more volatile.
Before it’s here, it’s on Smartkarma
