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    Perry Capital is considering investing in NEC Electronics (NECE), a subsidiary of NEC Corporation. The document provides guidelines for analyzing this potential investment, including: 1) Analyzing opportunities and challenges in Asian, especially Japanese, markets and determining NECE's fundamental value under Perry's assumptions. 2) Comparing NECE's share price to its fundamental value to assess if it is a good investment, considering the reasonableness of Perry's assumptions and potential agency problems. 3) Considering how publicly listed subsidiaries have historically performed in Japan and what options Perry Capital analyst Apl Ercil should pursue, weighing the implications for his career and partnership.

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    Perry Capital is considering investing in NEC Electronics (NECE), a subsidiary of NEC Corporation. The document provides guidelines for analyzing this potential investment, including: 1) Analyzing opportunities and challenges in Asian, especially Japanese, markets and determining NECE's fundamental value under Perry's assumptions. 2) Comparing NECE's share price to its fundamental value to assess if it is a good investment, considering the reasonableness of Perry's assumptions and potential agency problems. 3) Considering how publicly listed subsidiaries have historically performed in Japan and what options Perry Capital analyst Apl Ercil should pursue, weighing the implications for his career and partnership.

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    130 views1 page

    Case 3 Guidelines

    Uploaded by

    kian_sin_1
    Perry Capital is considering investing in NEC Electronics (NECE), a subsidiary of NEC Corporation. The document provides guidelines for analyzing this potential investment, including: 1) Analyzing opportunities and challenges in Asian, especially Japanese, markets and determining NECE's fundamental value under Perry's assumptions. 2) Comparing NECE's share price to its fundamental value to assess if it is a good investment, considering the reasonableness of Perry's assumptions and potential agency problems. 3) Considering how publicly listed subsidiaries have historically performed in Japan and what options Perry Capital analyst Apl Ercil should pursue, weighing the implications for his career and partnership.

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    FIN3102 INVESTMENT ANALYSIS AND PORTFOLIO MANAGEMENT CASE 3 GUIDELINES NEC ELECTRONICS

    (DUE DATE: NOV. 2, 2012) 1. What are the opportunities and challenges facing Perry Capital when investing in the Asian markets (particularly Japan)? 2. What is the fundamental value of NECE shares under the assumptions made by Ercil and the Perry team? 3. Is NECE a good investment? How does the price of its shares compare to their fundamental value? If there is a difference? Why? In your answer, you should consider: a. whether the Perry assumptions are reasonable, and b. the impact of potential agency problems on NECEs market value. 4. Historically, how have publicly listed subsidiaries of parents performed in Japan? 5. If you were Apl Ercil, what would you do? In considering your options, please account for the motivations of the parent company NEC, the implications each choice has for Ercils career, and the likely reaction of Ercils partners at Perry. Note: 1. These are just guidelines. Please feel free to discuss other issues as you deem fit. The Spreadsheet Supplement is available on IVLE under the Assignment folder. 2. The format for the case report is the following: double-spaced, typewritten, not exceeding 15 pages (including texts, tables, and appendices).

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