Nippon Soda 4041 @315Yen (Japan).
This is not a Japanese softdrink company, it is in fact a diversified Japanese chemical business. The stock is cheap (book is ~520Yen, trailing earnings are 36Yen and Forecast as of 5/13 is ~41Yen). What makes Nippon Soda interesting, is that approx. 40% of their business and most of their profits come from agrochemicals. In fact, by my calculation, most of the profits from the agrochemical division come from foreign subsidaries and equity affiliates (they use equity look through earnings for the consolidated earning estimates). Amongst the holdings is a minority stake in Novus (animal feed) and a Brazilian company (Iharabras AS, 100% owned by Nippon Soda). These companies are apparently independently run and based on the earnings (the difference between company and group earnings) pretty successful. I assume that if valued on their own, they would be worth more than Nippon Soda's stock valuation. The rising Yen and the subpar domestic performance of Nippon Soda has masked the good performance of their foreign business and equity stakes but my bet is that this won't go on forever (ha ha!).
quote.tse.or.jp
I also decided to sell my stake in Tsurumi pump 6351 to finance my Nippon Soda stake. The reason is that peers like DMW and Toroshima pump showed very low earnings forecast that apparently were not build in the stock yet, so I fear that Tsurumi Manufacturing could be treated likewise. FWIW Nippon Soda is down ~6% today after the forecast was released because apparently the market hoped for better results.From my mpoint of view though, increasing earnings for Y2012 by 14% to 41Yen/share looks OK to me, after the Tsunami disaster.
Maybe I overlooked something, maybe not.... |
