Monthly Wrap

Dear readers,

This month's wrap features two thematic sub-sectors and four sponsored names with stellar earnings. The four sponsored updates are on en-japan (4849), Benefit One (2412), Vision (9416), and Intelligent Wave (4847). en-japan and Benefit One, both mid-caps, are leaders in their respective areas. Vision and Intelligent Wave are small/micro-caps with interesting business models. All four of them had strong earnings growth in the past quarter.

In EV batteries, there were more positive developments in the Chinese electric car area, the biggest market for EV batteries. VW announced two weeks ago a USD12bn plan to make electric cars in China. Among the LiB part suppliers, there were two upward revisions to forecasts, at Nippon Kodoshi (3891) and Techo Smart (6246). Seika Sangyo (8061) sells separator film gear used in LiBs in China. Seika has large backorders for LiB equipment that should prop up earnings in the following quarters.

Regarding the HR theme, we attended several interesting earnings briefings this month, including two micro-cap names, Career Index (6538) and NMS (2162). Career Index’s OP was up 106% YoY on a 41% increase in sales. NMS revised up OP by 9% despite a 13% decrease in OP in the 1H. The firm has a unique full supply chain business model providing EMS, human labor, and power supply products. The current order environment is robust.

We also added Beenos (3328) and Kumai Chemical (4996) to the pipeline of SR sponsored names.

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