The Must Read PSA Weekly Research Round-up (week to 14 Sep)

Reports Highlighted this week: 2018 Smartphone & Smartphone Components / LINE (3938 JP) – We revise our earnings estimates downwards / BIG PICTURE: Pelham Smithers reviews the tech market for small speed reducers / Julie Boote looks at the threat to Japan’s auto exporters / COMPANY INSIGHTS: Thao Nguyen’s ZOZO Suit arrives … at last / Extremely negative reaction to Aug sales at Rohm / Joel Scheiman discusses Sumco’s weakness and trade issues

The Weekly Comment by Pelham Smithers

Amid all the excitement over the unveiling of the new Apple (AAPL US) handsets, executives at KDDi (9433 JP) were focusing their attention on a different Apple product and one that has until now, been something of an afterthought – the Apple Watch. This fourth iteration of the Apple wearable not only represents a significant improvement in terms of functionality (Apple S4 chip, Bluetooth 5.0, 16GB storage), but is designed with a medical role in mind, which has resonance in Japan given its aging population.
Wearables – most obviously the Fitbit – are generally associated with health and fitness, and Apple has been gearing its watch range towards that end, for example by making the Watch 3 water-resistant so that swimmers could monitor their progress up and down the pool. However, these facets were geared towards the sporty millennial looking to improve their fitness scores and were not intended as a wellness monitor. Now, with an electrocardiogram (EKG) sensor* and software which can detect whether you’ve tripped, or fallen over, the Apple Watch 4 is just that. Furthermore, Apple has gone so far as to clear the Watch 4 with the US FDA as a new type of medical device, along with earning the blessing of the American Heart Association.

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

1. 2018 Smartphone & Smartphone Components Report
2. LINE (3938 JP): We Revise our Earnings Estimates Downwards

Company / Sector / Thematic Comments at a Glance

Technology: Consumer Electronics, Electronic Components, Gaming

1. Apple’s Latest Offerings
2. Updates from Bandai Namco (7832 JP) and mixi (2121 JP) Driving Mobile Game Sales
3. Rohm (6963 JP) August Sales +0~5% YoY
4. Renesas (6723 JP) to Buy IDT
5. Pioneer (6773 JP) Gets a Helping Hand
6. Ultra-Wide-Band LED Development Boosts Helios Techno (6927 JP)
7. Market for Small Speed Reducers: Nidec (6594 JP), Harmonic Drive Systems (6324 JP)
8. Sumco’s (3436 JP) Weakness and Trade Issues

Chemicals / Materials

9. Miraial’s (4238 JP) More Upbeat Earnings Meeting
10. Japan Display (6740 JP) Enjoys a Positive Reaction
11. Toray’s (3402 JP) Carbon Fiber Business Remains Tough
12. Sedans Will Come Back, Says Nissan (7201 JP)

Autos

13. The End of Mirrors: Toyota (7203 JP) Replaces Door Mirror with Camera on Lexus ES
14. Are Japan’s Auto Exports to the US Under Threat?
15. Daikin (6367 JP) Continues to Hit Record High

Auto Parts / Machinery

16. Fanuc (6954 JP) to Build a New Plant in Michigan
17. IHI (7013 JP) Edges Up for Seventh Straight Day
18. Altaba (AABA US) to Sell its Entire Stake in Yahoo Japan (3689 JP)

Internet / eCommerce

19. Start Today (3092 JP): ZOZOSUIT Review
20. Nikkei Notes “Poor Performance” of AI Funds

Macro / Miscellaneous

21. Foreigners Dump Japan Shares
22. Rehabilitation of Shibuya Bit Valley

PSA Company Visits, Tours and Interviews

  • Visited Kuraray (3405 JP), NOK (7240 JP)
  • Attended earnings meeting at Miraial (4238 JP)
  • Phone interviews with Renesas (6723), Ohara Inc (5218 JP), Akebono Brake (7238 JP)

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