Naohide Une, a former executive at Goldman Sachs Group Inc., is venturing into unorthodox territory in Japan’s investment landscape. Through his company, Investment Lab Co., he’s broadening the fund’s portfolio to include undervalued sectors such as funeral parlors and daycare operators. As Japanese stocks soar to a 34-year high, Une aims to offer investors both domestically and internationally opportunities for returns by targeting smaller equities often overlooked by major investment firms.
While the surge in Japanese equities has largely been driven by a select few large-cap stocks, Une recognizes the importance of diversification in investment strategies. He identifies approximately 3,000 Japanese companies that remain outside the purview of mainstream research conducted by major securities firms, focusing on those with untapped growth potential.
Investment Lab currently manages over 10 billion yen ($68 million) in assets, with plans to grow this figure to about $400 million within the next two years, as revealed by Une in an interview. The fund has attracted investments from both domestic and foreign institutional investors and boasted positive returns for 14 consecutive months until October of the previous year.
Established in 2020, Tokyo-based Investment Lab reflects Une’s extensive experience, having previously led Goldman Sachs’ Asian derivatives trading team in Japan and held a position as a managing executive officer at Japan Post Bank Co. His investment philosophy emphasizes meticulous research, with the firm conducting up to 2,500 interviews and surveys annually to pinpoint growth opportunities amidst evolving economic conditions and policy shifts.
Among Investment Lab’s selected investments are:
- Kosaido Holdings Co.: With Japan’s aging population in mind, Investment Lab has invested in Kosaido Holdings Co., a key player in cremations within Tokyo’s 23 wards. Since Investment Lab’s entry in 2022, Kosaido’s share price has more than tripled.
- JP Holdings Inc.: Seizing upon government initiatives aimed at combating the country’s declining birthrate, Investment Lab has invested in JP Holdings Inc., which operates businesses related to childcare. The company’s stock has nearly doubled since the close of 2021.
- Central Automotive Products Ltd.: Recognizing the trend of prolonged car ownership, Investment Lab has targeted Central Automotive Products Ltd., a developer of automotive body coating materials. The company’s stock price has doubled over the past year.
Through its focused approach and keen eye for emerging trends, Investment Lab under Naohide Une’s leadership continues to uncover value in unconventional corners of the Japanese market, offering investors the potential for long-term growth and diversification.
