No Freebies for Japan Post Shareholders as Group Shuns `Yutai'

  • Bucks trend in Japan to provide thank-you gifts to investors
  • Shares have been rocked by market turmoil, negative rates

Japan Post Group investors who were counting on getting perks for buying into the recently listed mail-delivery and financial giant can think again.

Japan Post Holdings Co. will refrain from introducing gifts for shareholders in the fiscal year starting April 1, said spokesman Hiromasa Inoue. Its banking and insurance units decided the same, spokesmen for the Tokyo-based companies said.

The decision bucks a growing trend in Japan, where companies provide shareholders with “yutai” -- presents ranging from food to discount tickets -- as a thank you for owning their shares. It also deals a blow to investors in last November’s three-pronged $12 billion initial public offering after the stocks were battered by global market turmoil and the Bank of Japan’s decision to introduce negative interest rates.

“Besides dividends, giving gifts is a very powerful tool to stop shares from falling as individual investors appreciate that they’re being treated with respect,” said Nobuyuki Fujimoto, a senior market analyst at SBI Securities Co. “That’s something Japan Post should do while the shares are falling.”

Japan Post Bank Co. is the worst performer among the three companies, slumping about 17 percent from its IPO price as negative rates threaten to crimp its interest income. Japan Post Holdings has risen about 2 percent after dropping as much as 11 percent earlier this month. Japan Post Insurance Co. has advanced 11 percent, paring gains of as much as 77 percent in the first week of trading. The benchmark Topix index has slid 15 percent since the three stocks listed.

A third of Japan’s publicly traded companies give yutai to shareholders at least once a year, according to research by Nomura Investor Relations Co. As of Jan. 31, a record 1,289 firms, including real estate investment trusts, were expected to send the gifts this year, the research shows.

Yutai come in many forms, from bags of rice to free hotel stays. Mitsubishi UFJ Financial Group Inc. plans to give Peter Rabbit-themed goods, discount tickets for stock brokerage commissions and coupons for favorable deposit rates this year, according to its website. Oriental Land Co., the operator of Tokyo Disneyland, is offering one-day passes to the theme park, while ANA Holdings Inc. is giving discount plane tickets.

“Yutai is getting more popular among individual investors in Japan,” SBI’s Fujimoto said. “Japan Post investors will demand yutai when it’s not realistic to raise dividends.”

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