The Must Read PSA Weekly Research Round-up (week to 22 Oct)

REPORTS: Shin-Etsu Chemical (4063 JT) / GA Technology (3491 JT) / Nomura Research Institute (4307 JT) / Industry Insights: Might video game stocks’ earnings surprise on the upside? / Can MLCCs suffer while semiconductors do well? / Survey results on intention to use PayPay / China auto sales drop sharply in September / Company Insights: News / Previews & Results / Nintendo ups the ante with Switch Online / analyst downgrade / Sony sells one of its mobile gaming units for US$1bil / Disco 2Q smashes published consensus / Ferrotec shares overreact to LAM guidance disappointment / Nippon Steel’s lawsuit against Toyota makes global headlines / Plus additional COMPANY INSIGHTS, NEWS, PREVIEWS & RESULTS

The Weekly Comment by Pelham Smithers

The latest Jibun Bank PMI has both services and manufacturing outlook scoring above 50. The last time that happened was April 2019. Why isn’t the stock market feeling the optimism, asks Pelham Smithers.

Reports / Flash Notes Published This Week: Headlines at a Glance

1. Shin-Etsu Chemical (4063 JT): On Track to Exceed FY21 Guidance
2. GA Technologies (3491 JT) – Our Positive Stance Remains
3. Nomura Research Institute (4307 JT) FY21 Q2 Preview – High Expectations
Japanese Business is Confident, so Why is the Stock Market so Skittish?

Company / Sector / Thematic Comments at a Glance

Technology: Consumer Electronics, Gaming

1. Nintendo (7974 JT) Ups the Ante with Switch Online / Broker Downgrade
2. Sony (6758 JT) a Mobile Gaming Unit Sold for US$1bil / Cease-and-Desist Letter to Dbrand / Adele, BTS
3. Might Video Game Stocks’ Earnings Surprise on the Upside?

Technology: Industrial Electronics / Components / Semis & SPE / Precision

4. Tech-related Moves & News That Caught Our Eye
5. Disco (6146 JT): FY21 2Q Smashes Published Consensus
6. Micron (MU US) to Build a Fab in Japan
7. Can MLCCs Suffer While Semis Do Well?

Chemicals / Materials

8. Nippon Paint’s (4612 JT) 5th Acquisition in Five Years
9. Ube Industries’ (4208 JT) Disappointing Revision

Autos

10. Toyota’s (7203 JT) Production / Nippon Steel’s (5401 JT) Lawsuit vs Toyota Makes Global Headlines
11. Toyota Plans to Build Battery Factory in the US
12. Production Cuts at Subaru (7270 JT); Nissan (7201 JT) Also Trims Plans
13. China Auto Sales Drop Sharply in September

Auto Parts / Machinery

14. Takeuchi (6432 JT) Likely to Beat FY21 Guidance Though Short of Record OP
15. Ferrotec (6890 JT) Shares Overreact to LAM Guidance Disappointment

Internet / eCommerce

16. Survey Results on Intention to Use PayPay
17. Launch of “Rakuten Point Interest”
18. Kakaku.com’s (2371 JT) FY21 H1 and Full Year Revision Down

Enterprise Software

19. Money Forward (399 JT) Tumbles Following Earnings
20. Cybozu Wins Contract with Hiroshima City Government
21. NRI (4307 JT) FY21 Q2 Preview: Expecting Another Strong Quarter
22. Medley Inc (4448 JT) and NTT Docomo to Acquire OTC Pharmacy

Miscellaneous

23. Other News & Moves That Caught Our Eye

PSA in the Press

Pelham Smithers’ pictorial timeline of the rise of gaming revenue is featured in the following article: https://www.campaignlive.co.uk/article/media-buyers-sold-in-game-advertising-hugely-underestimate-size-market/1730199

PSA Company Visits, Tours and Interviews

• Visited: Ferrotec (6890 JT), Denso (6902 JT), Toyota Industries (6201 JT), Diamond Electric (6699 JT), Ube Industries (4208 JT), Dexerials (4980 JT)
• Conference Calls with: CyberAgent (4751 JT), HCM (6305 JT)
• Presentations at: Sumitomo Chemical (4005) small meeting

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