IR & Research Intelligence, Sessa Investment Research

Sessa Investment Research

IR & Research Intelligence

Sponsored research focusing on Japanese small cap.

Equity Bottom-Up

OHBA CO., LTD. is a civil engineering consultant company.  The Company's services include land and air surveying, designing of parks and roads, and development/redevelopment of urban land.

<ul><li>OHBA (hereafter referred to as "the Company") has achieved 12 consecutive years of operating profit growth through FY2023/5, and is on track to stretch this streak to 13 consecutive years in FY2024/5, having posted a 20.1% YoY increase in operating profit for cumulative 3Q FY2024/5.</li><li>The Company has secured orders for a number of landmark construction projects from both the public and private sectors, including basic policy formulation and master plan preparation work associated with the optimization of Japan Self-Defense Force facilities, Kumamoto JASM/TSMC (Taiwan Semiconductor Manufacturing Company) Phase 1 plant, Sony Semiconductor Solutions Corporation plant, among others.</li><li>It has been able to capitalize on the robust macro environment, partly supported by the continued rise in technician prices for design work outsourcing</li></ul>

OHBA (hereafter referred to as "the Company") has achieved 12 consecutive years of operating profit growth through FY2023/5, and is on track to stretch this streak to 13 consecutive years in FY2024/5, having posted a 20.1% YoY increase in operating profit for cumulative 3Q FY2024/5.The Company has secured orders for a number of landmark construction projects from both the public and private sectors, including basic policy formulation and master plan preparation work associated with the optimization of Japan Self-Defense Force facilities, Kumamoto JASM/TSMC (Taiwan Semiconductor Manufacturing Company) Phase 1 plant, Sony Semiconductor Solutions Corporation plant, among others.It has been able to capitalize on the robust macro environment, partly supported by the continued rise in technician prices for design work outsourcing

Ohba (9765 Jp) - Pushing Forward to Break Record for Consecutive Years of Operating Profit Growth

Tokyo Tsushin, Inc. develops casual mobile game applications. The Company also engages in advertising, investment, web services, and other businesses. TokyoTsushin serves clients throughout Japan.

<ul><li>Tokyo Communications Group’s core businesses currently include its Media business, where it plans and develops free game apps for smartphones and uses a portion of the app’s screen space to generate advertising revenue, and its Platform business, where it operates a consultation service based on a pay-as-you-go model.</li><li>The company also functions as an investment company with the aim of achieving company-wide growth while diversifying risks by allocating the cash flow generated by these core businesses into various promising digital businesses.</li><li><p>The company's main business at the time of its founding consisted of developing and operating free game apps for smartphones.</p></li></ul>

Tokyo Communications Group’s core businesses currently include its Media business, where it plans and develops free game apps for smartphones and uses a portion of the app’s screen space to generate advertising revenue, and its Platform business, where it operates a consultation service based on a pay-as-you-go model.The company also functions as an investment company with the aim of achieving company-wide growth while diversifying risks by allocating the cash flow generated by these core businesses into various promising digital businesses.The company's main business at the time of its founding consisted of developing and operating free game apps for smartphones.

Tokyo Communications Group (7359 JP) - Actively Pushing to Become a Digital Business Conglomerate

Paycloud Holdings Inc. offers technology services. The Company provides customer relationship management services, high speed email delivery solutions management, data security solutions development, arappli services, quick response code development, and other services. Paycloud Holdings provides its services throughout Japan.

<ul><li>1H Results: On April 12, 2024, Paycloud Holdings Inc. announced its 2Q FY2024/8 earnings, its first earnings announcement since becoming a holding company and changing its name on March 1, 2024.</li><li>In 1H FY2024/8, the company reported net sales of ¥1,990 mn, adjusted EBITDA of ¥226 mn, and operating profit of ¥86 mn. It had an irregular 5-month accounting period in 1Q FY2023/8 that included the July-August 2022 earnings following a change in the accounting period of the former Valuedesign Inc., which was merged with the company.</li><li>As a result, the company's earnings summary for 1H FY2024/8 show sales being down 12% YoY, adjusted EBITDA up 2% YoY, and operating profit up 237% YoY.</li></ul>

1H Results: On April 12, 2024, Paycloud Holdings Inc. announced its 2Q FY2024/8 earnings, its first earnings announcement since becoming a holding company and changing its name on March 1, 2024.In 1H FY2024/8, the company reported net sales of ¥1,990 mn, adjusted EBITDA of ¥226 mn, and operating profit of ¥86 mn. It had an irregular 5-month accounting period in 1Q FY2023/8 that included the July-August 2022 earnings following a change in the accounting period of the former Valuedesign Inc., which was merged with the company.As a result, the company's earnings summary for 1H FY2024/8 show sales being down 12% YoY, adjusted EBITDA up 2% YoY, and operating profit up 237% YoY.

NITTO KOGYO CORPORATION manufactures and sells a variety of power switchboards. The Company also manufactures metal/resin parts for power switchboards, and circuit breakers.

<ul><li><strong>News:</strong> The Nikkei on April 25th reported, "A dark cloud is hovering over the future of the electric car (EV) market.</li><li>The low prices of Chinese EV manufacturers, backed by Chinese government subsidies, are adversely affecting the performance of related companies such as motor giant Nidec Corporation (TSE Prime: 6594).</li><li>The spread of low-cost EVs will substantially change the structure of the industry, and investors are beginning to look out for companies that will benefit from the commoditization of EVs.</li></ul>

News: The Nikkei on April 25th reported, "A dark cloud is hovering over the future of the electric car (EV) market.The low prices of Chinese EV manufacturers, backed by Chinese government subsidies, are adversely affecting the performance of related companies such as motor giant Nidec Corporation (TSE Prime: 6594).The spread of low-cost EVs will substantially change the structure of the industry, and investors are beginning to look out for companies that will benefit from the commoditization of EVs.

Nitto Kogyo Corporation (6651 JP) - News and Imprecation

Frontier Management Inc / Equity Bottom-Up

Frontier Management Inc. offers business consulting services. The Company provides management consulting, mergers and acquisitions advisory, management executive support, and business regeneration support services. Frontier Management offers services in Japan.

<ul><li>Frontier Management (hereafter referred to as "the company") is a consulting firm that operates in the three pillars of management consulting, M&amp;A advisory, and business revitalization services, as well as an investment business that began in 2022.</li><li>Founded by Mr. Shoichiro Onishi and Mr. Masahiro Matsuoka, both former employees of the Industrial Revitalization Corporation of Japan, the company has expanded its operations through proactive hiring.</li><li>It is characterized by its lineup of specialists with diverse backgrounds and is able to solve a wide variety of management issues as a one-stop shop. Mr. Matsuoka retired as of the shareholders' meeting held on March 27, 2024, leaving Mr. Onishi as the sole leader of the company.</li></ul>

Frontier Management (hereafter referred to as "the company") is a consulting firm that operates in the three pillars of management consulting, M&amp;A advisory, and business revitalization services, as well as an investment business that began in 2022.Founded by Mr. Shoichiro Onishi and Mr. Masahiro Matsuoka, both former employees of the Industrial Revitalization Corporation of Japan, the company has expanded its operations through proactive hiring.It is characterized by its lineup of specialists with diverse backgrounds and is able to solve a wide variety of management issues as a one-stop shop. Mr. Matsuoka retired as of the shareholders' meeting held on March 27, 2024, leaving Mr. Onishi as the sole leader of the company.

Full Report - Frontier Management Inc. | 7038