PSA Japan Research Round-Up for the Week ending November 15

The Weekly Comment Summary
Pelham Smithers can scarcely believe his eyes as he contemplates the possible Z Holdings, LINE deal and what it could mean for SoftBank Corp and Japan’s bricks and mortar retailers.

Reports / Flash Notes Summaries this Week
1. Japan Strategy: What Sort of Earnings Season Was This, and What Does it Suggest for the Market Going Forward?
2. Nissan’s (7201 JT) FY19 Q2 Results: New CFO – Trying to Do The Right Thing
3. Implications from the Potential Merger of Z Holdings (4689 JT) and LINE Corp (3938 JT) / SoftBank Corp (9434 JT) and the Telecom Triangulation Story
Company / Sector / Thematic Comments
Technology: Consumer Electronics, Gaming
1. Nintendo (7974 JT) Releases Pokémon Sword & Shield
2. Tencent (700 HK) Plans Make Console Games Using Nintendo (7974 JT) Characters
3. Square Enix (9684 JT): Update on Dragon Quest Walk
4. Sony (6758 JT) to List Real Estate Affiliate
Technology: Industrial Electronics / SPE / Components / Precision
5. Toshiba (6502 JT) 1H OP up 7x – Nikkei
Chemicals / Materials
6. Fujifilm Holdings’ (4901 JT) Impressive Q2
7. Japan Display’s (6740 JT) Roadmap Remains Short
8. Tokyo Ohka Kogyo (4186 JT) Achieves 84% of OP Guidance
Autos
9. Japan’s Automakers Top the US Consumer Reports’ Reliability Ranking
10. Automakers: Improved Outlook for Raw Material Costs and Forex in Q4
11. Isuzu (7202 JT) Q2 Earnings Hurt by Weak Asia Sales
Auto Parts / Machinery
12. Market Reactions to Daifuku’s (6383 JT) Earnings and FY20 Guidance
13. HDS (6324 JT) and SMC (6273 JT) Both Downgrade Full-Year Guidance
14. SMC (6273 JT) Results Meeting Feedback: Founder’s Son Becomes President
15. A/C Theme Remains Firm
Internet
16. Recruit’s (6098 JT) Earnings Beat
17. istyle (3660 JT) Surges on Expectation of Smaller Losses
18. Potential Acquisition of LINE (3938 JT): The Latest Move in SoftBank Corp’s (9434 JT) Triangulation Story
Enterprise Software
19. Persol Holdings (2181 JT) Lowers OP and Sales Forecasts
20. Cybozu (4776 JT) Confirms FY19 Q3 OP and Sales
21. PKSHA (3993 JT) Beats on FY19 Sales and Misses on OP
Strategy
22. What Sort of Earnings Season Was This, and What Does it Suggest for the Market Going Forward?

PSA Company Visits, Tours & Interviews
• Visited: JSR (4185 JT)
• Interviewed / Conference Call with: Tokyo Ohka Kogyo (4186 JT), Z Holdings (4689 JT), TIS Inc (3626 JT)
• Attended results / strategy / mid-term plan announcement meetings at: Fujifilm Holdings (4901 JT), Japan Display (6740 JT), Kuraray (3405 JT), Kaneka (4118 JT), Stella Chemifa (4109 JT), Sanyo Chemical Industries (4471 JT), Sumitomo Seika (4008 JT), Sumitomo Bakelite (4203 JT), Fujimi Inc (5834 JT), JCU Corp (4975 JT), Mitsui Mining & Smelting (5706 JT), Obara Group (6877 JT), Toyo Gosei (4970 JT), Nissan (7201 JT), Daifuku (8383 JT), SMC (6273 JT)

PSA in the Press
• Pelham Smithers is quoted in the Japan Times in an article on SoftBank Group
/news/2019/11/07/business/corporate-business/softbanks-son-business-as-usual-shares-down/#.XcqzOFf7SUl
• Pelham Smithers is in the Financial Times quoted on the outlook for Apple
/content/91ed299c-023b-11ea-be59-e49b2a136b8d