The PSA Weekly Research Round up for the Week to 10 January 2025

Weekly Comment Summary
On 24 Jan the Bank of Japan will decide whether to raise rates.
At this point, the likelihood of a hike is probably 50:50.
Pelham Smithers discusses factors which may swing the decision.

Reports / Flash Notes Summaries
1. NTT Data (9613 JT) – The Data Centre Boost
NTT Data’s overseas data centre business is growing faster than the broader market. While it accounts for less than 10% of the company’s sales and will continue to do so, we estimate that by FY26 it will account for more than 20% of OP. We think that the business will not only benefit the long-term outlook for the company alone, but it plays an important role for cross- and up-selling across the rest of NTT Data’s businesses. Moreover, with a FY25 EV/Ebitda of just over 9x, the company’s valuations are significantly lower than those of its global peers in the data centre business.
2. Intermestic Inc. (262A JT) – Plenty of Headway for Store Openings
We initiate coverage on budget eyewear store “Zoff” operator, Intermestic. Analyst Hiroyuki Terada models for double-digit OP growth out to FY27, and sees valuations of this small cap stock as undemanding.

PSA Company Visits, Tours and Interviews
• 1-1 Call with: Insource: (6200 JT), Koshidaka Holdings (2157 JT), Intermestic (262A JT)
• Conference Calls with: Asahi Kasei (3407 JT)
• Presentations at: Sekisui Chemical (4204 JT), Mitsui Mining & Smelting (5706 JT), Yaskawa Electric (6506 JT)

PSA Weekly Contents at a Glance
Reports / Flash Notes Summaries
1. NTT Data (9613 JT) – The Data Centre Boost
2. Intermestic Inc. (262A JT) – Plenty of Headway for Store Openings
Company / Sector / Thematic Comments
Technology: Consumer Electronics, Gaming
1. Video Games Round-Up
2. Sonic the Hedgehog Movie Franchise Hits US$1bil in Box Office Sales
3. Other News & Moves That Caught Our Eye
Technology: Industrial Electronics / Components / Semis & SPE / Precision
4. Data Centre Demand Strength Leads Hon Hai’s Dec Sales to Rise +42% YoY
5. Fujitsu General Finally Finds a Buyer
6. Memory Chip Prices Continue to Soften
7. Yaskawa Produces a Weak Q3 along with Unconvincing Guidance
8. Other News & Moves That Caught Our Eye
Chemicals / Materials
9. Taiyo Holdings, DIC Said to Explore Combining
10. Kaneka Acquires EndoStream Medical
11. Other News & Moves That Caught Our Eye
Autos / New Mobility
12. US Auto Sales December: Mixed Results for Japanese Automakers
13. Toyota Plans Opening of Woven City
14. Toyota to Use Nvidia’s SoC and AD Operating System
15. Sumitomo Rubber to Acquire the Dunlop Brand
16. Other News & Moves That Caught Our Eye
Auto Parts / Machinery / Capital Goods
17. Fujikura Rises on Microsoft AI Capex Plans
Internet / eCommerce
18. Rakuten Securities and Rakuten Bank Reach New Milestones
19. GA Technologies to Provide Further Services for Brokerage Companies
20. Other News & Moves That Caught Our Eye 15
Enterprise Software / IT Services
21. Sansan: FY24 Q2 Preview
22. Shift Inc: FY25 Q1 Preview
23. Money Forward: FY24 Full Year and Q4 Preview
24. BayCurrent: FY24 Q3 Preview
Pharma / Healthcare
25. Pharma-Related News & Moves That Caught Our Eye
Small- / Mid-Cap Insights
26. Koshidaka FY25 Q1 Results
27. Treasure Factory’s December KPIs
Miscellaneous / Market / Strategy / Macro
28. Strong Wage Data for Nov 2024 Augurs Well for December Bonus Season
29. Is the Worst Over for Shimano?
30. Other News & Moves That Caught Our Eye
List of Recently Published PSA Notes & Reports
Important Disclosure Statement from Pelham Smithers Associates Limited