Recent Reports

Japan telecoms – FY22 guidance largely insulated from pressure to raise wages

With inflation rising above 2% for only the third time in 22 years, talk of the need for higher wages is likely to increase but telecom operators are on the right side of this issue already.

NTT (Buy) – Updated forecasts and comments on telework

NTT has adopted a progressive telework policy and we expect the entire industry is moving this way. We have updated our model for new segments and expectations of a Q1 beat from a stronger dollar.

Japan Internet – Fresh lows for many with Rakuten the lowest since 2010

Tech sector weakness amplifies concerns on competition for Rakuten and Z Holdings. Both are down 50%+ from recent highs with Rakuten at levels last seen in 2010.

Softbank Group – Semiconductor weakness expands discount

The discount to fair value has expanded by 4pp in a week as tech weakness not only reduces net asset value but also raises concerns on an IPO of ARM. Currency tailwinds have provided some offset.

Softbank Group – Didi relief and ZME pain highlight multiple potential outcomes

Good news on Didi and recent gains for Coupang and Goto highlight the potential for Vision Fund companies to re-rate although the delisting of Zhangmen shows multiple outcomes are possible

Rakuten (Neutral) – Follow-Up on Q1 Results and Thoughts on a Securities Listing

Rakuten is trading at near-term lows as the path to mobile profitability and cash burn may be longer than expected. A second fintech IPO is positive for surfacing value but less so on use of proceeds

Arteria Networks (Buy) – Q4 21 results reaction: between a rock and a hard place

Arteria posted solid results but remains range bound as scale and liquidity may be insufficient for investors looking for safety in volatile markets.

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