Fintech Tracker: Private market valuations have been improving
Financials
Fintech operational performance remains healthy with usage and / or revenue growing in the high teens across the segments Astris tracks. Relative to their coverage, the main issues are the path that DoCoMo takes to adding banking to its fintech portfolio (Astris thinks it will build a smartphone app) and the timing and size of a PayPay IPO. In the case of the latter, a surge in private fintech values (up 30%+ in 2025) looks promising although recent market volatility adds some doubt. A longer timeline to a listing gives LY Corp / Softbank time to further expand PayPay’s fintech presence.
Edition: 207
- 21 March, 2025
Japan Fintech Tracker: Valuations for online payment assets
Valuations for payment assets have become increasingly important as LY Corp (PayPay IPO) and Rakuten (fintech restructuring) look to public markets for eventual validation. Kirk Boodry thinks both are worth more than ¥1,000bn, although he gives a slight edge to PayPay on better visibility. Whilst there has been talk of a PayPay IPO for years, Rakuten will probably be the first to move as it has set a Jan deadline for its fintech restructuring. Meanwhile, online banks have been market darlings with SBI +87% YTD and Rakuten Bank +45% even with the uncertainty over a deal with the parent company.
Edition: 195
- 20 September, 2024
Communications
Despite an upgrade to EBITDA guidance at Q3 results, shares of LY Corp remain mired in a slump as a near perfect storm of worries, ranging from competition to data security, have arisen in recent months. However, Kirk Boodry thinks these concerns are largely overdone, whilst his investment thesis, that ID integration and PayPay growth can support growth in the core businesses, remains intact. His new TP of ¥560 implies potential upside of 40%. Kirk assumes 6.7% consolidated annual revenue growth through 2030. Annual EBITDA growth is slightly faster at 9% as margins expand on cost efficiencies and fintech’s progression to profitability.
Edition: 182
- 22 March, 2024