Report
EUR 9318.00 For Business Accounts Only

Japanese Telcos At a MAJOR inflection as Fintech integration drives ARPU; lift forecasts and Price Targets

Something significant has shifted in Japan. The telcos, and especially KDDI and SB Corp are now using their strength in financial services to drive customers towards unlimited offers. The result is likely to be an acceleration of ARPU recovery, and suggests we are at an important inflection point. We lift ARPU forecasts and price targets. SoftBank Corp is our new top pick, PT ¥2,500, from ¥2,200.
Underlyings
KDDI Corporation

KDDI is a telecommunications company. Along with its affiliates, Co. operates in four principal business segments: personal, value, business, and global. Co. is engaged in the sale of mobile handset; and the provision of mobile telecommunication services under "au" brand name, Internet contents, settlement service, and electronic money service for individual customers. Co. offers information and communication technology ("ICT") solution services and data center services for domestic corporate customers, overseas companies and individual customers. Co. is also involved in the call center business, the research and technological development, and the telecommunication facilities maintenance.

Mercari Inc.

NTT DATA Corporation

NTT Data is an information technology ("IT") company mainly engaged in the provision of system integration and network system services. Along with its affiliates, Co. operates in five business segments: public & social infrastructure, financial, enterprise & solutions, North America, and EMEA & LATAM. Co. provides IT services including system integration, network information, consulting, business solution, and system support services to its customers in various industries both domestic and overseas. Co.'s principal products and services are "Accel-Mart," "Aggregate Master®," "Tableau™," "IMDA®," "IsleLinX®," "BRIMOS®," "RemoteOne®," "WinActor," "ANSER," and "AnserDATAPORT®."

Rakuten Inc.

Rakuten is mainly engaged in the Internet-related business. Along with its affiliates, Co. operates in two business segments. The Internet Services segment is engaged in the operation of electronic commerce sites, including an Internet shopping mall "Rakuten Ichiba," an online cash back site, a travel booking site, portal sites and digital contents sites; the sale of advertising on Co.'s sites; the provision of messaging and communication services; and the management of a professional baseball team "Tohoku Rakuten Golden Eagles." FinTech segment is engaged in the provision of Internet banking services and online securities trading services, and the credit card and life insurance businesses.

SoftBank Corp.

Provider
New Street Research
New Street Research

Provided by our team of experienced analysts, our work is idea driven, based on independence of thought, sector expertise, and firmly focussed on fundamentals and valuation.

New Street Research is an independent, partner-owned, research firm specialising in equity and debt research. Our equity research embraces the following sectors:

  • Pan European Telecom Services and Cable
  • US Telecoms, Cable, Satellite and Towers
  • Global Emerging Market Telecoms
  • Japan Telecoms
  • Asian Internet
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Analysts
Chris Hoare

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