According to the WSJ, as hedge fund managers came to the podium last night at the Ira Sohn conference in Hong Kong, one theme seemed to stand out above the rest: Japan.
Apparently, Asian hedge funds are bullish on Japan, with some betting big on Shinzo Abe’s reforms coming to fruit:
“We are really only at the beginning of a process of change,” WSJ quoted Rob Crawford, founder of Japanese activist investing firm Ichigo Asset Management,as saying.
Even before recent scandals such as Toshiba’s accounting and Sharp’s bailout, Prime Minister Abe has called on Japanese corporations to do away with their antiquated zaibatsu/keiretsu dynamic and boost competition among themselves, asking them to set an 8% minimum return on equity target. Abe has also asked them to open up to foreign investors through Japan’s new corporate governance code.
These reforms have been slow to start, but nevertheless have attracted a lot of foreign capital in the process.
According to WSJ, other funds at Sohn came to Japan from a much different angle:
Tybourne Capital Management managing partner Eashwar Krishnan said his multibillion-dollar hedge fund, one of the most prominent Asia-based funds, is betting big on airport operators that would benefit from more Chinese traveling abroad. A top pick for his fund is Japan Airport Terminal Co., the operator of the Haneda airport terminal near Tokyo.
Mr. Krishnan noted that Chinese are traveling more frequently with rising incomes, though Japan was still capturing only a small fraction of the tourism.
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