PSA Japan Research Weekly Round-Up (week to March 2, 2018)

The PSA Japan Research Round-Up for the week ending 02 March, 2018
Contents at a Glance
The Weekly Comment by Pelham Smithers:
Pelham Smithers looks through the weak market to consider whether Japan’s enterprise software sector can break through commercially.
Reports / Flash Notes Summaries
1. Autos: End of the Golden Age for Light Trucks?
2. Internet: Trend Micro (4744 JP) – Safe and Sound
3. February US Auto Sales: US Auto Market Softens on Weakening Support from Light Trucks
Company / Sector / Thematic Comments
1. Spotify to IPO: Sony (6758 JP) in Line for Windfall
2. Update on PS Vue
3. “Fair Merger" Timing Brought Forward at Alps (6770 JP) / Alpine (6816 JP);
4. …Clarion (6796 JP) Fails to Benefit
5. US Tariffs on Steel and Aluminium
6. Mitsubishi Chemical (4188 JP) May Continue to Trade at a Discount
7. TDK (6762 JP): Acquisition of a Good Addition to its Sensors Portfolio / Ups its Development of Fast-Charging LiBs
8. Bosch Gives up on Battery Cells; Battery JV with GS Yuasa (6674 JP) and Mitsubishi Corp (8035 JP) will be Dissolved…
9. …But battery Demand is Looking Good Elsewhere
10. Light Truck Market in the US Could Come Under Pressure
11. Strong Overseas Production in January, and Upbeat Comments on Honda’s (7267 JP) Hybrid Plans
12. Auto Sector under Pressure as Steel Import Tariffs Loom
13. Is Geely (175 HK) a Threat?
14. Firm FY18 Machinery Forecasts Led by China
15. Yaskawa (6506 JP) Goes Ex-Dividend / Bounces on News of Apple’s Next Trio of iPhones to Come
16. MHI (7011 JP): Raising Funds
17. GREE (3632 JP) to Launch a New Romance Simulating Game for Women
18. CyberAgent (4751 JP): Music Streaming App AWA is the Best Non-Game App of the Year
19. Kakaku.com (2371 JP): 20,000 Restaurants Have Signed up for the New Pricing Plans
20. Rakuten (4755 JP) Will Launch its Own Cryptocurrency – Rakuten Coin
21. Rakuten’s (4755 JP) Entry into Mobile
PSA Company Visits, Tours and Interviews
• Visited Asahi Kasei (3407 JP), Kuraray (3405 JP), Kaneka (4118 JP)
• Telephone Interviews with Nitto Denko (6988), KH Neochem (4189)
• Attended the Smart Energy Week 2018 exhibition
PSA in the Press
Pelham Smithers was quoted twice in the London Times on the new Samsung S9 smartphone:
https://www.thetimes.co.uk/article/in-a-galaxy-far-far-away-a-samsung-s9-smartphone-is-worth-750-jf7qwzd7z
https://www.thetimes.co.uk/article/phones-will-tell-you-if-theres-a-burglar-ntd5q9v53
Weekly Market Comment by Pelham Smithers
When you have sharp sell-offs, it can be very instructive to look at the list of stocks that made positive gains, to see if there’s any pattern. Often there isn’t – those stocks that buck the trend often do so simply because they aren’t caught up in basket trades, either because they are too small, too new, or both. That trait is a useful one on the downside, but equally unhelpful on the upside, and in any case tends to be arbitraged out over time. However, sometimes the concentrated group of winners can give an insight into what the market really favours. Last year, there were several occasions when the market was down, but factory automation was up across the board, and in the sell-off on Thursday this week in particular, we saw something similar, but this time with enterprise software – particularly enterprise software related to telecom. Among the few big gainers of the day were ISB (9702 JP), Cyber Com (3852 JP), MTI (9438 JP), TDC Soft (4687 JP), Itfor Inc (4743 JP), Tecnos Japan (3666 JP) and Internetworking and Broadband Consulting [IBC] (3920 JP), all plays on the telecom / IT software space.