13 Jul 2017
As a result of the “Abenomics” reform, listed Japanese corporations are steadily
accumulating wealth in the form of cash and other liquid assets since 2013.
The share price of these cash rich corporations remains undervalued. Nearly half
of the listed companies in Japan have a PBR of less than 1.0. These undervalued
corporations have a large potential for a hike in share price.
In June 2017, the PBR of JASDAQ Japan listed Solekia (9867) soared from 0.3 to
1.2 in less than six months. The new “Stewardship Code” introduced in 2014 forces
stronger corporate governance in Japan. Since 2014, there have been significantly
stronger shareholder dialogues thus expanding investment opportunities.