Oasis' three point proposal to Pasona's board and management can be downloaded here (suggest color printing).
- Efficient capital allocation
- Improved cost management
- Rebuilt governance structure
Pasona's operating profit margin was 1.6% for FY2017/5 and 1.7% based on the company's forecast for FY2018/5. This is significantly lower than the level of its competitors, as major companies in the industry produce more than 5% operating profit margin, and even higher for companies dedicated to more profitable business models.
We feel that Pasona's weak profitability was inevitable considering its track record:
- Building and operating a giant new theme park in Awaji Island (more than 5 hours away from Tokyo)
- Creating a REAL farm inside of Pasona's corporate headquarter high rise in central Tokyo
- A rumored luxurious guest place used for parties owned by the company.
Our analysis based on Pasona's scale and business portfolio indicates that there is an opportunity for the company to improve its operating profit margin in excess of 5%. Such an improvement in profitability will stabilize Pasona's employment, strengthen its financial position, enhance its competitiveness. As a result, the company's stock should be valued at least JPY3,754 per share, a premium of over 142% to the closing stock price as of November 7, 2017.