Japan-focused shareholder activist. Buying stakes in Japanese small caps for ~30c on the $ and engaging with them to realise the embedded value . DMs open
Sydney, New South Wales
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Japanese stocks are rallying to heights not seen since the 1990s. Back then it was the aftermath of bubble valuations. Now, there is a solid foundation of earnings growth, corporate governance improvements, and increasing cash returns to shareholders! 1/n
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For the first time in Japan a Tokyo court has upheld an activistโs request for a (provisional) injunction against the implementation of a takeover defence measure that was approved by a vote of the target companyโs shareholders.
This is a major win for 3D Investment Partners over the management of the company in which it has invested โ Toho HD.
Underperforming management teams in Japan often seek to use takeover defence measures to entrench themselves by preventing economically-minded shareholders from gaining too much voting influence and thus effecting managerial change.
As the full judgment is not yet available, we do not know whether the reasoning used will have broader ramifications or be limited in its scope. Additionally, the judgment was delivered by a court of first instance, and the company has stated it will appeal the decision.
Despite this, the judgment could be so important that it is worthwhile discussing in detail - see my full write up at the link in the comments.
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What could possibly go wrong with borrowing at 10% to invest into the extremely expensive equity of a highly capital intensive commodity producer with well financed competitors operating in an industry with a winner takes all mindset?
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Check out the trailer for the episode of the Blunt Dollar Podcast I did with Igancio Ramirez Moreno.
If you can get past my invisible ears, I'm sure you'll find it worthwhile!
Full video address is in the comments.
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Many thanks to Ignacio Ramirez Moreno, CFA for hosting me on the Blunt Dollar podcast.
He does not have a presence on X, but he is huge on Link ed in - give him a follow there if you do not already.
In this just-released episode of the Blunt Dollar, Ignacio and I discuss:
๐ฏ๐ต How we at Senjin Capital distinguish the opportunity in Japanese small caps from the broader market, and my view on the argument that Japan is a permanent value trap.
๐ How Senjin researches hidden assets, tests business durability, and considers what a potential acquirer might pay before committing capital.
๐๏ธ What separates meaningful corporate governance reform from surface level changes, and why smaller companies are at a different stage of that journey.
๐ค What constructive activism looks like in practice, from private conversations and financial education to proposals on pricing, operations, capital allocation, and growth.
โณ How Senjin approaches liquidity and exit risk when change takes years, plus my advice for aspiring investors on reading source documents, learning from mistakes, and thinking from first principles.
Check out the full podcast at the link in the comments.
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Many thanks to Ignacio Ramirez Moreno, CFA for hosting me on the Blunt Dollar podcast.
He does not have a presence on X, but he is huge on Link ed in - give him a follow there if you do not already.
In this just-released episode of the Blunt Dollar, Ignacio and I discuss:
๐ฏ๐ต How we at Senjin Capital distinguish the opportunity in Japanese small caps from the broader market, and my view on the argument that Japan is a permanent value trap.
๐ How Senjin researches hidden assets, tests business durability, and considers what a potential acquirer might pay before committing capital.
๐๏ธ What separates meaningful corporate governance reform from surface level changes, and why smaller companies are at a different stage of that journey.
๐ค What constructive activism looks like in practice, from private conversations and financial education to proposals on pricing, operations, capital allocation, and growth.
โณ How Senjin approaches liquidity and exit risk when change takes years, plus my advice for aspiring investors on reading source documents, learning from mistakes, and thinking from first principles.
Check out the full podcast at the link in the comments.
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If only people understood that taxes and government spending are just as subject to the Jevons paradox as computing power and freeways!
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What is better than supporting a great charity?
Talking investment opportunities while doing so!
It was a pleasure to be part of the Alternative Future Foundation's Invitational (IN) Day last week.
Part of Sydney Alts week, it is a forum for Family Office and High Net-Worth Investors to hear from different and interesting managers and other presenters about investment opportunities globally.
I joined my former colleague @cameronrob1 , manager of @platassetmgmt's Asia Fund, and Mugunthan Siva of India Avenue Investment Management on stage as part of a panel that discussed investment opportunities in Asia, ably hosted by the one and only Kim Ivey.
The AFF supports a number of important charities, and its association with Sydney Alts Week also includes the long-running Hedge Funds Rock & Australian Alternative Investment Awards evening.
Thanks to everyone who participated in the events and supported the AFF.
I hope to see even more people at these events next year!
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This is huge and great news for investors in Japanese equities!
2000ๅนดไปฃๅใใซๆจช่กใใใใคใบใณใใซใ2025ๅนดไปฅ้ใPBR1ๅไปฅไธใฎไธๅ ดไผๆฅญ็ตๅถใซๅฏพใใฆๅถๆฅญ็ฑๅฟใช่ฃฝ่ฌไผ็คพใฎใใใใงใใคใบใณใใซใฏๅใณๆต่กๆฐๅณใ ใฃใใ2026ๅนด5ๆใใใ30%ใซใผใซใ(ๅๅ30%ไปฅไธไฟๆใใฆ่ฒทใใพใใใTOB)ใ้ๅๆณใงๆนๆญฃใใใใใๅฎๆ
ใจใใฆใใคใบใณใใซใฏ็ตๅถ่
ใๅฅฝใใชใฌใใซใงใๅซใใ ใฃใใใใใใๆ ชไธปใซๅฏพใใฆ่ฒทใๅขใใๆๅถใใใใผใซใใใใไปๅพๆๅถใใใใไฝฟใใฅใใใชใใๅฎใฏ่ฃฝ่ฌไผ็คพใฏใใๆฏ้
ๆจฉใใจใใ่จ่ใไฝฟใใใใใชใใใจใใใจใใๆฏ้
ๆจฉใใจใใ่จ่ใๅบใ็ฌ้ใไผ็คพใฎใๆไบใใจใชใใๆฏ้
ๆจฉใ็ฆ็นใจใชใไธญใใขใปใใๅขใ๏ผๅคๅ๏ผ่ช็คพใฎๅถๅฎใใ่ญฐๆฑบๆจฉ่กไฝฟๅบๆบใฎ็ฏๅฒๅคใจใชใใใฐใฉในใซใคในใISSใชใฉ่ญฐๆฑบๆจฉๅฉ่จไผ็คพใฎใขใใใคในใซ้ ผใใใกใๅฉ่จไผ็คพใใๆฏ้
ๆจฉใ๏ผๅฎ้20%ใ ใใใใใพ้ขไฟใชใ๏ผใจใใใญใธใใฏใฎไธญใๆ ชไธปใ่ถ
ๅณใใๅคๆญใใใใใใชๆฏ้
ๆจฉ่จใใใใใขใผใใใฉใผใธใๆจช่กใใฆใใไธญใๆฑไบฌ่ฃๅคๆใฏใใใใใใTOBใซใผใซใใใใใๆฏ้
ๆจฉๅ้กใฏ30%ใใใใใใจ้ๅๆณใฎใขใใใใผใใซใใ่ฃฝ่ฌไผ็คพใปไธๅ ดไผๆฅญ็ตๅถใซไธ็ณใๆใใใใๅฝข
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"Animal Spirits" are on the rise in Japan!
Japanese households have always been severely underexposed to the stock market relative to savers in other developed countries.
This is starting to change, helped by a couple of factors.
1. The newly expanded Nippon Investment Savings Accounts provide major tax advantages
2. The performance of the Japanese and US stock markets has increased investment balances directly, and led to more inflows into the asset class.
Japanese stock performance can be linked to a few drivers, but a key one is the ongoing corporate governance reform that has pushed management teams to become more focused on results for shareholders.
As Japanese individuals increase their shareholdings, management teams and the government are likely to become more cognisant of the importance of keeping them happy.
This can only be a good thing for the Japanese equity markets.
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Link to full article: asia.nikkei.com/economy/japaโฆ
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Most certainly NOT an activist. More a warehouse for holding cross shareholdings, funded by the cross-shareholders.
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I was interviewed yesterday by @AlanKohler for the Talking Finance podcast - an offering from "The Intelligent Investor" (@value_investing) portal, part of InvestSMART Group (@InvestSMART_AU).
Alan is a highly respected financial journalist in Australia, and does a great job interviewing guests on a range of topics.
You can check out our brief interview at the link in the comments (from 21:50 in the recording), where we discuss the path of the Yen and the highly compelling opportunities in small-cap shareholder activism in Japan.
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Link to recording (free signup required): intelligentinvestor.com.au/iโฆ
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Japanese hoteliers are apparently cancelling new hotel projects because of a rapid increase in construction costs.
The average construction worker now earns a newly expensive US$30k/yr (A$42k)! If you are from Australia or the US, let how small that salary number is sink in...
I was told in the weekend that an electrician in Australia with three years' experience working on data centres can command A$400k/yr!
Clearly "expensive" is a relative term.
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Check out the latest Asia Centric podcast from Bloomberg Intelligence (link in the comments).
โJamie Halse, chief investment officer at Senjin Capital, joins Bloomberg Intelligence's John Lee on the Asia Centric podcast.
He explains that while much of the headlines have focused on Japan's corporate giants like Toyota and Sony, the most compelling value lies in the under-researched small- and mid-cap space.
Halse unpacks why smaller firms are only in the early innings of governance reform, how unwinding cross-shareholdings is stripping away corporate protection, and the cultural nuances of working with Japanese management teams on capital allocation and shareholder value.โ
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