2025-05-15-Jefferies-TechnoPro四月月度报告；就业服务月度报告（2025年5月）_13页_819kb

Equity Research Summary: Japan Business & Employment Services

Market Overview:

• TOPIX rose 12.4% in the past month (through 14 May), with HR services median share price performance at 8.9% month-on-month, reflecting positive sentiment in the sector.

Key Developments:

• Shunto Wage Growth: Annual Shunto negotiation resulted in a 5.5% wage increase, accelerated from earlier trends, which is expected to narrow the pay gap between part-time and full-time workers due to regulatory pressures and company struggles for staffing.
• Government Policy: Ministry of Labor encourages wage hikes and sets a target for minimum wage to reach ¥1,500, benefiting companies like Timee.
• Technopro Performance: April utilization rate stands at 91.2% (95.5% in Apr last year), showing slight negative sentiment due to factors like price increases and US tariff exposures in autos and industrial sectors.

Employment Data Highlights:

• Spotwork Interest: Per Persol data, ~4.52mn workers are currently in spotwork, with ~14.31mn considering it, indicating potential growth. A restaurant executive notes that while Timee's 30% take rate increases costs, part-time attrition reduces overall recruitment inefficiency.
• Real Wages: Ministry of Labor data shows real wages are negative (-2.1% YoY) in Japan due to high inflation (4.2%), highlighting ongoing challenges for companies to achieve real wage inflation.
• Job Postings: Indeed Hiring Lab data and Hello Work reports show mixed trends; for instance, German job postings volume increased, while US and UK postings decreased month-on-month, reflecting sector-specific dynamics.
• Industries: Hotel and restaurant sectors show strong growth in job openings (+33.5% YoY), while construction and manufacturing saw declines (-2.4% and -4.5% YoY), reflecting demand shifts.

Company-Specific Insights:

• Timee: Utilized for spotwork, favored for high fill rate and market leadership. Investment recommendation: BUY, emphasizing competitive advantages and expansion into new areas like hotels and elderly care.
• Technopro Holdings: BUY-rated, with focus on engineering staffing. Analysts note stable utilization rates but risks from US tariffs and controlled hiring during downturns.
• Recruit Holdings: BUY-rated but risks from US macroeconomic conditions. Valuation is attractive, but performance may be impacted by external factors.
• Valuation Trends: Charts indicate wage increases and job market tightness favoring companies investing in human capital, such as those tracking the new JPX Nikkei Human Capital Index.

Investment Outlook:

• Analysts recommend Timee and Visional for their leadership positions in spotwork and direct recruitment, respectively. Technopro is favored for its stability in engineering placements.
• Risks include US tariff impacts and macroeconomic challenges for companies with US exposure (e.g., Recruit). Natural attrition and price hikes could affect Technopro's performance.

Recommendations and Risks:

• Hold recommendations for Kakaku.com and support for companies aligning with equal pay regulations.
• Overall market sentiment is positive for HR service providers, but vigilance is needed regarding wage pressures and global economic uncertainties.

This summary captures the essence of the equity research, focusing on key events, data, and recommendations without delving into granular details.