Report
Joel Scheiman ...
  • Julie Boote
  • Pelham Smithers

PSA Today Mar 5: Some bottom up support/Capcom's Monster Hunter/SBI Ripple moves deeper into banking/Trade wars/Dexerials' big sell-off/Teijin and GM - Nikkei -0.66%

Japan Market Comment by Pelham Smithers, Julie Boote and Joel Scheiman
Nikkei ¥21,042.09 (-¥139.55 / -0.66%); Topix ¥1,694.79 (-¥13.55 / -0.79%); ¥/$105.56
Tags: Sony (6758 JP), Fast Retailing (9983 JP), United Arrows (7606 JP), DyDo Group Holdings (2590 JP), Kakaku.com (2371 JP), KLab (3656 JP), Capcom (9697 JP), SBI Holdings (8473 JP), GMO Internet (9449 JP), Woori Bank (000030 KS), SBI Ripple Asia, Cambridge Global Payments, FleetCor Technologies (FLT US), Western Union (WU US), Fujitsu (6702 JP), Yahoo Japan (4689 JP), Solxyz (4284 JP), NEC (6701 JP), Hitachi (6501 JP), NTT Data (9613 JP), Soramitsu, Tesco (TSCO LN), Costa, Blockstream, Digital Garage (4819 JP), Credit Saison (8253 JP), Rakuten (4755 JP),Toyota (7203 JP), Honda (7267 JP), Hyundai (005380 KS), Dexerials (4980 JP), Teijin (3401 JP), General Motors (GM US)
Main Points at a Glance
• Could have been worse
• Monster Hunter: World Ships 7.5mil Units
• SBI Ripple Asia Moves Deeper into Banking
• Trade Wars: NAFTA, bourbon and exemptions
• Sell-off in Dexerials could prove short-sighted
• Teijin’s carbon fiber gets a pickup from GM
Underlyings
Capcom Co. Ltd.

Capcom is engaged in the development, manufacture and sales of video games, online games, mobile games and arcade games, as well as the operation of amusement arcades. Co.'s business segments are digital contents, amusement facility and amusement equipment. Co. is engaged in the planning, development, manufacture and sales of home video games, online games and mobile games including "Rockman," "Monster Hunter World" and "Dragons Dogma"; the operation of "Plaza Capcom" amusement facilities in Japan; and the development, production and distribution of arcade games for amusement facilities. Co. is also engaged in the licensing business of game characters and the real estate leasing business.

Costa Group Holdings Ltd.

Costa Group Holdings is a horticulture company and produce supplier to the Australian food retailers. Co. has three reportable segments: Produce, which operates in four main categories consisting of berries, mushrooms, glasshouse grown tomatoes and citrus; Costa Farms and Logistics, which incorporates interrelated logistics, wholesale avocado marketing and banana farming and marketing operations within Australia; and International, which comprises royalty income from licensing of Co.'s blueberry varietals in Australia, the Americas and Africa, and international berry farming operations in Morocco and China.

Credit Saison Co. Ltd.

Credit Saison is mainly engaged in the provision of credit services. Along with its affiliates, Co. operates in five business segments: credit services, lease, finance, real estate-related and entertainment. Co. is engaged in the credit card (SAISON and UC) business, the servicing (loan collection agency) business, the handling vendor leasing business for office equipment mainly targeting SME clients, the credit guarantee (unsecured free-loans to individual customers) business, the finance (long-term fixed-rate mortgage loans) business, the real estate and real estate leasing business, and the amusement business mainly indoor recreation facilities.

Digital Garage Inc.

Digital Garate is a business context company engaged in the provision of marketing technology, financial technology and incubation technology solutions. Co. is engaged in the provision of integrated promotion solution services and data management solutions utilizing web marketing; the development and sales of social media-related advertising technology; the development and sales of overseas travel information apps for cellular phones; the sales of website support tools; the e-commerce payment solution services; the investment and incubation of venture companies and start-up companies; and the provision of data security related solutions.

FAST RETAILING CO. LTD.

Fast Retailing is engaged in the control and management of overall group activities as a holding company. Co., through its subsidiaries, is mainly involved in the operation of chain stores, selling casual clothing and accessories at reasonable prices, called "UNIQLO" throughout Japan as well as in overseas. Co., through its subsidiaries, is also engaged in the planning, manufacture and sale of clothing under the brand names of "GU," "Theory," "COMPTOIR DES COTONNIERS," "PRINCESSE tam.tam" and "J Brand." In addition, Co. is engaged in the leasing of real estate.

FLEETCOR Technologies Inc.

FleetCor Technologies is provider of commercial payment solutions. The company's five primary product lines are Fuel, which provides fuel payment solutions to businesses and government entities who operate vehicle fleets, as well as to main oil companies;Lodging, which provides lodging payment solutions to employees who travel overnight for work purposes; Tolls, which provides an electronic toll and parking payments product; Corporate Payments, which include virtual cards, purchasing cards, travel and entertainment cards; and Gift, which provides gift card product management and processing services. Additionally, the company provides other payment products including fleet maintenance and employee benefits.

Fujitsu Limited

Fujitsu is the parent company of a group engaged in the information and communication technology businesses. Technology Solutions segment provides system integration, application development and integration, system consulting, IT and business process outsourcing services, cloud computing, SAP and Oracle applications services and managed infrastructure services (network and communication, technical and maintenance and service desk services). The segment also offers security platforms, servers, storage systems and software. Ubiquitous Solutions segment offers desktop PCs, notebook PCs, mobile phones and wearable devices. Device Solutions segment offers LSI devices and electronic components.

General Motors Company

General Motors designs, builds and sells trucks, crossovers, cars and automobile parts. The company also provides automotive financing services through its subsidiary, General Motors Financial Company, Inc. (GM Financial). GM Financial provides retail loan and lease lending across the credit spectrum. GM Financial provides commercial lending products to dealers including new and used vehicle inventory floorplan financing and dealer loans, which are loans to finance improvements to dealership facilities, to provide working capital, and to purchase and/or finance dealership real estate. Other commercial lending products include financing for parts and accessories, dealer fleets and storage centers.

Hitachi Ltd.

Hitachi and its subsidiaries are engaged in the development, manufacture and sale of diversified product mix ranging from electricity generation systems to consumer products and electronic devices. Co.'s businesses are diverse, and include information and telecommunication systems, social infrastructure and industrial systems, electronic systems and equipment, construction machinery, high functional materials and components, automotive systems, life & eco systems, financial services, and others including logistics services, optical disk drive, as well as real estate business.

Honda Motor Co. Ltd.

Honda Motor is the parent company of a group mainly develop, manufacture and distribute motorcycles, automobiles, power products, and also provide financing for the sale of those products. Principal manufacturing facilities are located in Japan, the United States of America, Canada, Mexico, the United Kingdom, Turkey, China, India, Indonesia, Malaysia, Thailand, Vietnam, Argentina, and Brazil. Co.'s principal business segments are motorcycles, automobiles, financial services, and power products & other business. Co.'s principal automobile products include passenger cars such as "Legend," "Accord," "Inspire," "Civic," "Insight," "City," "Acura RL," "Acura TL," "Acura TSX," and "Acura CSX".

Kakaku.com Inc.

Kakaku.com is engaged in the operation of price comparison and other portal websites. Internet Media segment operates a price comparison site "Kakaku.com"comparing various products including computers, home appliances, internet service providers, insurance, food/beverages and cosmetics, restaurant review site "tabelog.com" and other portal sites including a hotel deals and last minute deals site "yoyaq.com," travel-related review and comparison site "4travel.jp," residential real estate portal site "sumaity.com," lifestyle portal site "kinarino.jp," movie information site "eiga.com"and auto enthusiast site "webCG." Finance segment is engaged in the provision of insurance agency services.

KLab Inc.

KLab is mainly engaged in the development of game applications. Along with its affiliates, Co. is engaged in the planning, development and operation of mobile online games and social network games for smartphones in Japan and overseas. Co. is also engaged in the provision of cloud computing and the operation of e-commerce sites, large-scale and high-intensity infrastructure services, and research and consulting services for mobile online games, as well as the planning and organization of variety of events hosted in Japan and all across Asia, such as stadium tours, music festivals and stage musicals.

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.

Sony Corporation

Sony is engaged in the development, design, production, manufacture, offer and sale of various kinds of electronic equipment, instruments and devices for consumer, professional and industrial markets such as network services, game hardware and software, televisions, audio and video recorders and players, still and video cameras, mobile phones, and semiconductors. Co. is engaged in the development, production, manufacture, and distribution of recorded music and the management and licensing of the words and music of songs as well as the production and distribution of animation titles. Co. is also engaged in the production, acquisition and distribution of motion pictures and television.

Teijin Limited

Teijin and its affiliates are mainly engaged in the fiber-related business. Co.'s operation is divided into two business segments: Materials Business and Healthcare Business. Materials Business focuses on high-performance fibers, such as aramid fibers and carbon fibers, as well as polycarbonate resin and polyester film. It also produces and sells Polyester and recycled polyester fabrics and textiles. Healthcare Business provides pharmaceuticals for bone and joint disease, respiratory disease, cardiovascular and metabolic disease as wel as healthcare products. Co. also provides various IT services, along with internet services such as e-comics services.

Tesco PLC

Tesco is a retailer. Co. and its subsidiaries are engaged in retailing and associated activities in the U.K. and Republic of Ireland; and Czech Republic, Hungary, Poland, Slovakia, Malaysia, and Thailand. Co. provides retail banking and insurance services through Tesco Bank in the U.K. Co. sells and services of motor and home insurance policies underwritten by Tesco Underwriting Limited, or in a minority of cases by a third-party underwriter. As of Feb 25 2017, Co. had a total of 6,809 stores worldwide, including 256 franchised stores.

Toyota Motor Corp.

Toyota Motor is an automobile manufacturer. Co. is primarily engaged in the design, manufacture, and sale of sedans, minivans, compact cars, sport-utility vehicles, trucks and related parts and accessories throughout the world. Co. provides financing, vehicle and equipment leasing and certain other financial services primarily to its dealers and their customers to support the sales of vehicles and other products manufactured by Co. Co.'s principal business segments are automotive operations, financial services operations and other operations. Co. sells its vehicles in approximately 190 countries and regions, and markets for its automobiles in Japan, North America, Europe and Asia.

Western Union Company

Western Union is a holding company. Through its subsidiaries, the company is engaged in money movement and payment services, providing people and businesses with ways to send money and make payments around the world. The company's segments are: Consumer-to-Consumer, which is focused on individual money transfers from one consumer to another; and Business Solutions, in which the company facilitates payment and foreign exchange solutions, primarily cross-border, cross-currency transactions, for small and medium size enterprises and other organizations and individuals. The company's remaining businesses and services include its electronic-based and cash-based bill payment services.

Woori Bank

Woori Bank is engaged in commercial banking, investment banking, Internet banking, international banking as well as financial services including securities, leasing and factoring. Co.'s main activities include deposits, loans, trust funds, security activities, money trusts, foreign exchanges, credit card services, electronic banking, global on-line information services, corporate banking, automatic teller services and electronic banking.

Z Holdings Corporation

Yahoo Japan is engaged in the provision of Internet advertising and e-commerce services. Media Business segment provides marketing and advertising services including paid search, display, in-feed video advertising and other advertising-related services for corporations; and Yahoo! News and media-related services. Commerce Business segment provides e-commerce related services including YAHUOKU! (net auction site), Yahoo! Shopping, ASKUL, LOHACO and other shopping websites; membership services including Yahoo! Premium, Yahoo! BB and other services; and financial and payment-related services including credit card, e-money, foreign exchange margin trading and other related services.

Provider
Pelham Smithers Associates Ltd
Pelham Smithers Associates Ltd

Founded in 2009, Pelham Smithers Associates (PSA) provides market intelligence on Asian technology, focusing in particular on Japan. The industries covered by our team of specialists are: consumer electronics, telecomms, pharmaceuticals, internet, electronic parts and materials, automotive technology, retail and capital goods. 

PSA produces both company and sector reports. The focus of PSA’s research is to identify winners and losers as new technologies impact the top and bottom lines of corporations. Critical to our research is the clear explanation of how these new technologies work and how they impact companies and industries. 

The founding partners have worked closely together for twenty years and the team has more than doubled in size since 2012. 

Analysts
Joel Scheiman

Julie Boote

Pelham Smithers

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