Quick Idea: Japan’s Blue Apron Making Moves To Corner The Market – Oisix Daichi (TYO: 3182)

Thinking Points

  • Oisix Daichi (TYO: 3182) holds a 30% share in a highly niche-y organic vegetable delivery industry in Japan.
  • The company is the result of a recent merger between Oisix and Daichi, the #2 and #3 players in the organic vegetable delivery industry.
  • With large companies entering the market, competitive pressures are on the rise. The CEO, however, thinks this is a good thing.

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Quick Idea: Japan’s Leading Tankless Water Heater Company With Growth In China & USA – Rinnai (TYO: 5947)

Thinking Points

  • Rinnai (TYO: 5947) leads the Japanese water heater market with a 40% market share.
  • However, Rinnai’s Japan share is not the story. Growth outside of Japan has rapidly gained traction over the past few years – particularly in China and the US.
  • As infrastructure in ASEAN countries develop, we can expect Rinnai’s ASEAN revenues to grow as well.

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Quick Idea: Sushi Machine Maker With No Formidable Competitor – Suzumo Machinery (TYO: 6405)

Thinking Points

  • Suzumo Machinery (6405) is well established in a niche sushi machine industry, holding 90% market share globally.
  • Top-line CAGR of 8.7% in the past 9 years, with particularly strong growth in Europe and N. America.
  • Run up in stock price over the past year probably puts Suzumo at fair value today, but further reading on the sushi market is necessary in order to have an educated discussion about continued growth.

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Idea: 50% Global Share In Premium Motorcycle Helmets – Shoei (TYO: 7839)

Thinking Points

  • Shoei has a 50% global share in premium motorcycle helmets.
  • Made in Japan focus makes the company sensitive to currency fluctuations.
  • Key growth areas are in China/SE Asia and US.

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Idea: 60% market share in high growth Japan pet insurance industry – Anicom Holdings (TYO: 8715)

Thinking Points

  • First world Asian countries are not particularly crazy about pets.
  • That said, more Japanese pets are getting their insurance cards.
  • Anicom holds a 60% market share in a Japanese pet insurance industry that’s seen double digit growth over the past several years (at least).

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Idea: 40% Domestic Share In Automotive Rearview Mirrors – Murakami Kaimeido (TYO: 7292)

Talking Points

  • Self-driving cars and camera systems are a thing now, and camera systems are replacing automotive mirrors.
  • With increased competition, the future is tough but not impossible for Murakami Kaimeido, which holds a 40% domestic and 7% global share in automotive rearview mirrors.
  • Murakami’s business performance and price metrics may paint a compelling picture for some investors.

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6121: Takisawa Machine Tool

Summary

  • Over the past decade, inventory levels have greatly increased, resulting in a drag in capital efficiency.
  • Investing in Takisawa at today’s price entails betting on management to quickly improve operational efficiency while assuming higher capital spending in the automotive industry.
  • Overall, Takisawa is technologically competent, but with a few operational problems. With all the pros and cons in mind, Takisawa Machine Tool is worth considering at 114 Yen per share (vs. today’s 177 yen per share).

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9436: Okinawa Cellular

Summary

  • Okinawa Cellular is not currently a buy, but investors ought to follow share prices periodically for buying opportunities at 2,600 yen per share (vs. current 3,555 yen per share).
  • Regional focus provides Okinawa Cellular with a strong market position in an Okinawan mobile carrier market, which accounts for less than 1% of the Japanese mobile carrier market.
  • Although the company is focused on being nimble and open to moving into industries unrelated to the mobile carrier market, its primary growth area today is in its fiber internet business.

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Tech In Japan: Stop And Smell The (Virtual) Roses

Summary

  • Virtual Reality (VR) is extending beyond visual and audio.
  • Video game industry development of smell VR might benefit from commercialization in physical retail and e-commerce.
  • There are a couple of investable companies with smell VR technology that should be followed.

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The Opportunity in Japan

At this point exploring our site you’ve probably seen a lot of nice verbose rhetoric with plenty of adjectives describing how attractive we think Japanese stocks are.  If you are as skeptical as I am though, you’d think that’s a load of BS until we substantiate it with some data and logical arguments.

We did introduce an argument in our first article and About page where we said there is no natural buyer for Japanese stocks, but until now, that’s been about it.  Not very compelling.  This article will attempt to introduce the case for Japan.

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