< The 2014 All-Japan Research Team
| Eiichi Katayama |
| Bank of America Merrill Lynch |
First-Place Appearances: 3 Total Appearances: 11 Analyst Debut: 2004 |
Eiichi Katayama “doesn’t hesitate to have his own view,” reports one money manager, “regardless of the consensus.” This boldness helps propel the Bank of America Merrill Lynch researcher back to first place, after a year at No. 2. Katayama, 47, has been highlighting corporate reorganization as the critical concern for companies in his sector. Japan’s consumer electronics companies “still mostly adhere to the conglomerate model, where they have a mix of good and bad businesses and find it very hard to extricate themselves from their ailing lines,” he explains. “A complete exit from these unprofitable businesses is the key challenge.” Accordingly, he advises investors to select players that have a “proven ability to execute on restructuring, are making observable progress and consequently have viable profit-growth scenarios.” One such name is Osaka-based Panasonic Corp., whose management over the past year has made what the analyst terms a “bold” decision to withdraw from the integrated-circuit-substrates, mobile-phone and plasma-TV-panel businesses, as part of its ongoing structural transition away from consumer electronics and toward industrial operations. Panasonic is focusing on its products for energy-efficient autos and homes, such as the batteries it supplies to U.S.-based Tesla Motors for use in its electric cars. Katayama also recommends owning Sony Corp. The Tokyo-headquartered manufacturer has sped up the pace of restructuring, he advises, and in February announced the sale of its Vaio computer brand to buyout firm Japan Industrial Partners. Moreover, Sony might scale down its television business and is changing its gaming revenue model from boxed software sales to online subscriptions, “thus transforming itself into a business centered on finance, entertainment and electronics, mainly semiconductors,” the analyst says. Katayama is possessed of “passion and penetrating insight,” another loyalist attests.
