165. From cash to corpses – taking advantage of Japan’s risk averse nature

Baillie Gifford Shin Nippon investment trust manager Praveen Kumar talks to us about the conservative nature of Japanese companies and how he is tapping into a new breed of business-owner who is willing to take more risks to grow. He also explains why encouraging these younger, dynamic and entrepreneurial business owners is crucial to the economy, particularly in the non-manufacturing space. Praveen also talks us through the growth of end of life services business Kamakura Shinsho as an example of a disruptor which is taking risks to grow and why he has to be patient when investing in these types of businesses. The manager also explains why politics play little part in his investment approach.
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Baillie Gifford Shin Nippon investment trust aims to provide long-term capital growth by investing in smaller companies listed on the Japanese stock market. Manager Praveen Kumar targets firms with innovative business models and the potential to disrupt their industries; those that challenge traditional Japanese practices; and those with strong overseas growth prospects. Praveen has a three- to five-year time horizon when building his portfolio.

What’s covered in this podcast:

  • Breaking through Japan’s risk-averse nature to find dynamic businesses which are not afraid to take risks
  • How Japan is adjusting to the “creeping realisation” that as a corporate entity it was no longer fit for purpose
  • How end of life services provider Kamakura Shinsho is disrupting the funeral services industry
  • The importance of being patient with young businesses and allowing them time to mature
  • Why a new prime minister is largely irrelevant to Praveen’s investment approach
  • Why Tottori is his favourite place to visit in Japan
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