Nomura Enterprise Value Allocation Index

Global Markets Research
17 June 2022

EQUITY: EQUITY QUANTITATIVE RESEARCH (INDEX)

Index rulebook

Research Analysts
Japan index products
Index Operations Dept. - NSC
idx_mgr@jp.nomura.com

The Nomura Enterprise Value Allocation Index is a market cap-weighted Japanese equity
index (with individual stock weightings capped at 3%) comprising stocks in highly
profitable companies that have taken proactive steps to improve shareholder returns, forexample by making appropriate investments in physical and human capital.
A quantitative indicator based on factors such as profits, dividends, personnel expenses,
capex, and R&D expenditure is used to select stocks for inclusion in the index, from a
universe of all common stocks listed on Japanese stock exchanges.
Index characteristics• The index comprises the top stocks (capped at 300) in terms of a quantitative indicator(total score) based on nine factors related to profitability and stakeholder returns.
• To ensure objectivity and accuracy in the selection of stocks for the index, factor
values are calculated only on the basis of widely available actual financial data.
• To take investability into account, inclusion in the index of stocks with low market cap
or low liquidity is restricted.
• The index is weighted by market cap, but individual stock weightings are capped at
3% to prevent excessive weighting towards large caps.
• Periodic reconfigurations of the index take place once a year.

Production Complete: 2022-06-17 07:11 UTC

See Appendix A-1 for analyst certification, important disclosures and the status of non-US analysts.

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Table of contents
1. Periodic reconfigurations
1.1. Periodic reconfiguration date
1.2. Periodic reconfiguration base date
1.3. Release of periodic reconfiguration data
2. Stock selection and index construction method
2.1. Stock selection universe
2.2. Calculation of total score
2.3. Stock selection method
2.4. Index weightings for constituent stocks
3. Unscheduled reconfigurations
3.1. Response to mergers[21]3.2. Removal of stocks
4. Index calculation
4.1. Index calculation method
4.2. Adjusting the base market capitalization
4.3. Index maintenance
5. Data publication services
Policies with regard to Nomura Securities Co., (NSC)’s indices
Appendix A-1

3
3
3
3
4
4
5
9
10
11
11
11
12
12
13
14
15
16
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1. Periodic reconfigurations
1.1. Periodic reconfiguration date
The periodic reconfiguration date is 20 August each year (or the following business day if
this is a non-business day), and the reconfiguration is carried out after the close of tradingon the business day preceding the periodic reconfiguration date.

1.2. Periodic reconfiguration base date
Stocks to be included in the index following its periodic reconfiguration are selected on thebasis of data as of the periodic reconfiguration base date, defined as the last business
day of July each year.

1.3. Release of periodic reconfiguration data
As a general rule, an announcement will appear on our website at around 16:00 JST
seven business days before a periodic reconfiguration, except in cases of unforeseen
circumstances or when information cannot be confirmed until immediately beforehand.

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2. Stock selection and index construction
method
2.1. Stock selection universe
The universe of stocks eligible for inclusion in the index, which we refer to as the stock
selection universe, includes the top 98% of all stocks listed on Japanese stock exchanges[1] in terms of free float–adjusted market cap as of 15 October in the year before theperiodic reconfiguration base date (or the business day before this if 15 October is a nonbusiness day; this is called the stock selection universe fixing date), out of all stocks listed
on Japanese stock exchanges as of end-March in the year before the periodic
reconfiguration base date. Of the stocks that were listed in or after April in the year before
the periodic reconfiguration base date, those in approximately the top 85% in terms of
free float–adjusted market cap and newly merged stocks are also included in the stock
selection universe. Stocks that meet the following criteria as of the reconfiguration basedate are excluded.
• Equities other than common stock
As a general rule, only common stock is included in the stock selection universe.
However, exceptions to this rule will be made if necessary.
• Stocks assigned for delisting
Stocks designated as securities to be delisted are not included in the stock selection
universe.
• Stocks on alert[2]Stocks designated as securities on alert are not included in the stock selection universe.
• Stocks under supervision (examination) and stocks under supervision (confirmation)[3]

Stocks under supervision (examination) and stocks under supervision (confirmation) thatare not included in the index immediately prior to the periodic reconfiguration are notincluded in the universe.
• Tender offer target companies[4]Stocks that are the targets of tender offers may be removed from the stock selection
universe if all of the following conditions are met:
1. The offer close date falls between the stock selection universe fixing date and theperiodic reconfiguration date;
2. The company conducting the tender offer plans to acquire all the outstanding
shares in the target company; and3. The company conducting the tender offer is planning to discuss acquiring all of thestock of the target company in exchange either for money or its own stock, and thetarget company has agreed to the offer.
• Listed investment trusts/REITs• Foreign stocks
Stocks listed on foreign sections of Japanese exchanges or stocks regarded asoverseas companies are excluded, even if these stocks are traded in the Japanesemarket.
• Other
Latent stocks, warrants, and rights on them are excluded. The Bank of Japan is also
excluded.
1.
2.
3.
4.

Tokyo Stock Exchange (Prime Market, Standard Market, Growth Market, TOKYO PRO Market), Nagoya
Stock Exchange, Sapporo Securities Exchange, and Fukuoka Stock ExchangeThis rule applies to periodic reconfigurations from August 2016.
This rule applies to periodic reconfigurations from August 2016.
This rule applies to periodic reconfigurations from August 2016.

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2.2. Calculation of total score2.2.1. Financial indicators used in stock selection
From data available as of the periodic reconfiguration base date, actual financial data forthe past three fiscal years is used, as defined below.
• Past three fiscal years
Most recently completed fiscal year: fiscal year-end falls between April in the year
before the periodic reconfiguration base date and March in the year of the periodic
reconfiguration base date.
Second most recently completed fiscal year: fiscal year-end falls in period covering 12months before most recently completed fiscal year.
Third most recently completed fiscal year: fiscal year-end falls in period covering 12months before second most recently completed fiscal year.
• Accounting standards
The highest priority is given to data prepared in accordance with IFRS, followed by US
GAAP (SEC), Japanese GAAP (consolidated), and Japanese GAAP (parent).
Where multiple financial indicators are available, the order of priority for accounting
standards and financial indicators is as follows.
Order of priority for financial indicators A, B, and C:IFRS financial indicator A > SEC financial indicator A > Japanese GAAP
(consolidated) financial indicator A > IFRS financial indicator B > SEC financial
indicator B > Japanese GAAP (consolidated) financial indicator B > IFRS financial
indicator C > SEC financial indicator C > Japanese GAAP (consolidated) financial
indicator C > Japanese GAAP (parent) financial indicator A > Japanese GAAP
(parent) financial indicator B > Japanese GAAP (parent) financial indicator C

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2.2.2. Score calculation universe
Using data as of the periodic index reconfiguration base date, stocks within the stock
selection universe that meet the following criteria are eligible for inclusion in the score
calculation universe.
Market cap criteria
1. Among all listed Japanese stocks, we screen for the top 2,000 stocks in terms of
average monthly trading value over the previous 12 months.
2. From the stock selection universe, we select the top 1,000 stocks in terms of free
float–adjusted market cap that meet criterion (1) above.
Creditworthiness criteria• Stocks for which data on operating profits[5] , net profits, or equity capital[6] for any ofthe past three years is not available are excluded.
• Stocks that have posted operating losses[7] in all of the past three fiscal years are
excluded.
• Stocks that have posted net losses[8] in all of the past three fiscal years are excluded.
• Stocks with net liabilities[9] in any of the past three fiscal years are excluded.

5.

6.
7.

8.
9.

For stocks where operating profit data (overall operating profits for railway companies, net business profits
for banks, business profits for insurance companies) is not available, we use recurring profits (pretax net
profits for IFRS, net profits before taxes for US GAAP) or net profits, in that order.
When shareholders’ equity data is not available, total capital (total of the items in the equity capital section of
the balance sheet) is used.
Operating losses refers to negative operating profits. For stocks where operating profit data (overall
operating profits for railway companies, net business profits for banks, business profits for insurancecompanies) is not available, we use recurring profits (pretax net profits for IFRS, net profits before taxes for
US GAAP) or net profits, in that order.
Net losses is negative net profits.
Net liabilities refer to negative shareholders' equity (ie, total net assets - (paid-in capital + stock acquisitionrights + minority interests)). When shareholders’ equity data is not available, total capital (total of the items in
the equity capital section of the balance sheet) is used.

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2.2.3. Factor-based ranking score
We rank the stocks in the score calculation universe in terms of nine factors based ondata for the past three years as of the periodic reconfiguration base date (we refer tothese rankings hereafter as ranking scores). We set out the methods used to calculate thenine factors below. Ranking scores are treated as not applicable (NA) if data for all of thepast three years is not available[10] .
(1) Total net profits
Total net profits over the three years, ie, the total of values for the most recently
completed fiscal year, the second most recently completed fiscal year, and the third mostrecently completed fiscal year[11] (same hereafter). The higher the value the higher the
ranking.
(2) Return on assets (ROA)
Average ROA (profits/total assets) over the three years, ie, the average for the mostrecently completed fiscal year, the second most recently completed fiscal year, and thethird most recently completed fiscal year, weighted at a ratio of 3-to-2-to-1, respectively(same hereafter).The order preference for the profit numerator is operating profits[12] ,recurring profits[13] , then net profits. The higher the value the higher the ranking.
(3) Dividend on equity (DOE)
Average DOE (total dividends/shareholders' equity[14] ) over the three years. When the
total dividends numerator or shareholders' equity denominator is zero or negative, DOE is
considered to be zero. The higher the value the higher the ranking.
(4) Total personnel expenses
Total personnel expenses (personnel expenses + labor expenses) over the three years.
The higher the value the higher the ranking.
(5) Change in personnel expenses to sales ratio
The average ratio of the year-on-year change in total personnel expenses (personnel
expenses + labor expenses) to sales over the three years[15] . The year-on-year change isthe difference from the previous year’s value. Companies for which financial indicators
based on the same accounting standards for the previous year and the current year are
not available are excluded from the calculation. The higher the value the higher the
ranking.
(6) Percentage change in number of employees
The average over the three years of the year-on-year percentage change in the numberof employees, calculated by dividing the difference between the current year’s figure andthe previous year’s figure, divided by the previous year’s figure. Companies for which
financial indicators based on the same accounting standards for the previous year and thecurrent year are not available are excluded from the calculation. The higher the value thehigher the ranking.
(7) Total capex/R&D expenditure
Total capex[16] and R&D expenditure over the three years. If capex data is not available,
property, plant, and equipment (current year) - property, plant, and equipment (previousyear) + depreciation expenses (current year) can be used. The higher the value thehigher the ranking.

10.
11.
12.
13.
14.

15.
16.

See 2.2.4. Calculation of total score for details of how we treat NA.
The average value for the other years is used if the value for one of the years cannot be used.
Overall operating profits used for electric railway companies, net business profits used for banks, andbusiness profits used for insurers.
Pretax net profits used for IFRS data, net profits before adjustment for taxes, etc, used for SEC data.
When shareholders' equity (ie, total net assets - (paid-in capital + stock acquisition rights + minority
interests)) data is not available, total capital (total of the items in the equity capital section of the balance
sheet) is used.
When the sales numerator is zero or negative, this is excluded from the calculation.
When accounting standards are on a nonconsolidated basis, we use capex (construction basis) for thecurrent year.

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(8) Total assets to capex/R&D expenditure ratio
The average over the three years of the ratio of total assets to capex/R&D expenditure (7)((capex + R&D expenditure) / total assets). The higher the value the higher the ranking.
(9) Change in total assets to capex/R&D expenditure ratio
The average over the three years of the year-on-year change in the ratio of total assets tocapex/R&D expenditure (8). The year-on-year change is the difference between thecurrent year and the previous year. Companies for which financial indicators based on thesame accounting standards for the previous year and the current year are not available
are excluded from the calculation. The higher the value the higher the ranking.

Fig. 1: Nine factors

No. Factor
1
2
3
4
5
6
7
8
9

Total net profits
Return on assets (ROA)
Dividend on equity (DOE)
Total personnel expenses
Change in personnel expenses to sales ratio
Percentage change in number of employees
Total capex/R&D expenditure
Total assets to capex/R&D expenditure ratio
Change in total assets to capex/R&D expenditure ratio

Basis
3-year total
3-year average
3-year average
3-year total
3-year average
3-year average
3-year total
3-year average
3-year average

Source: Nomura

2.2.4. Calculation of total score
A stock's total score is the average ranking score for the nine factors within the score
calculation universe. A ranking score of NA is designated a value of 500[17] .

17.

An approximation of the median ranking score.

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2.3. Stock selection method
Stocks selected for the index are those in the top 300 in terms of total score, taking into
account the rebalancing band as defined below, that also meet the liquidity criteria.
However, if the number of stocks selected in this way is less than 100, an adjustment tosecure an adequate number of stocks is carried out, as defined below.
(1) Rebalancing band[18]1. The top 250 stocks in terms of total score are selected unconditionally.
2. Stocks that are ranked in the top 350 in terms of total score and are included in theindex immediately before the periodic reconfiguration are selected in order of their
total score until the total number of such stocks reaches 300[19] .
3. If the number of stocks selected using methods (1) and (2) above is less than 300,
stocks are selected in order of their total score until the total number reaches 300[18] .
(2) Liquidity criteria• Stocks are excluded from the index if the number of days in the past year whentransactions were carried out (ie, the number of days on which trading value was notzero) is less than 200 (below, we refer to this as the business days criterion).
• Stocks are excluded from the index if total market turnover over the past year is lessthan ¥100bn (below, we refer to this as the market turnover criterion).
(3) Adjustment to ensure adequate number of stocks
If the number of stocks included in the index is less than 100, of the stocks in the top 400
in terms of total score that also meet the liquidity criteria (2), stocks are selected in orderof total score until the number of selected stocks reaches 100.
Fig. 2: Index construction method

Source: Nomura

18.
19.

This rule applies from the August 2016 periodic reconstitution.
If there are multiple stocks ranking 300th in terms of total score, the stock with the higher free float–adjusted
market cap is selected.

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2.4. Index weightings for constituent stocks
2.4.1. Weightings and weighting cap for constituent stocks
The index weighting of each constituent stock is based on its free float–adjusted market
cap[20] on the periodic reconfiguration base date. However, individual stock weightings
are capped at 3%, with the excess allocated to other stocks in proportion to their free
float–adjusted market cap.
2.4.2. Number of shares included in the index for index constituents and index
inclusion ratio
The number of shares included in the index for each constituent stock and its index
inclusion ratio (%) are calculated so that the index inclusion ratio is the same as the stock
weighting as defined above, using data as of the periodic reconfiguration base date.

• Nomura composite share price
The Nomura composite share price is the price on the exchange that is judged to havethe most accurate price for the stock in question (ie, its primary exchange), based on thepercentage of days on which the stock was traded and its trading volume over theprevious 60 business days. As a general rule, the primary exchange is selected on a daily
basis. The share price is selected according to the following order of precedence:Contract price on selected exchange (see note) > standard price on selected exchange >Nomura composite share price on previous business day
Note: Priority is given to the special quotation price or continuous confirmed quotation
price on the selected exchange if these are available.

20.

Free float–adjusted market cap of stock i = no. of shares out in stock i for index calculation purposes X
closing value of Nomura composite share price for stock i X (1 - stable shareholding ratio). Stableshareholding ratios are estimated from the stable shareholding—the number of shares considered to be held
on a stable basis, based on major shareholder data, the details of security holdings disclosed in securities
filings, and information published by stock exchanges and companies (in company reports, prospectuses,etc). The number of shares outstanding for index calculation purposes is the number of shares out after
taking into account changes in the number of shares in line with the timing of changes in capital structure
under 4.2 Adjustments to base market capitalization.

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3. Unscheduled reconfigurations
As a general rule, an announcement will appear on our website around two weeks before
an unscheduled reconfiguration, except in cases of unforeseen circumstances or when
information cannot be confirmed until immediately beforehand.

3.1. Response to mergers[21]The rules set out below are followed in order to avoid temporary exclusions of companies
from the index and maintain the consistency of stocks included in the index.
3.1.1. Mergers
When a stock is delisted because it is about to become a wholly owned subsidiary or bemerged into another company, it will continue to be included in the index after its delisting
but will be removed from the index on the day of the merger. Following its delisting, anduntil its removal from the index, the valuation of the stock that is about to become a wholly
owned subsidiary or merged entity will be based on the market value of the company thatwill become the parent or the surviving company multiplied by the exchange or merger
ratio. The index inclusion ratio of the parent or surviving company will be changed on the
day of the merger (or the following business day if the merger takes place on a nonbusiness day) to reflect the exchange or merger ratio.
3.1.2. Newly merged stocks
When an unlisted parent company assumes the operations of another company andbecomes listed after a short period of time, the stock of the wholly owned subsidiary isremoved from the index on the date of the parent company's listing. The price of thedelisted subsidiary used is the price on the day before its delisting. The parent company isincluded in the index on the date of its new listing. However, if it is clear that the parent
company will not be included in the index following the periodic reconfiguration, the wholly
owned subsidiary will be excluded on the date of its delisting.

3.2. Removal of stocks
3.2.1. Designation as securities to be delisted[22]Stocks designated as securities to be delisted will be removed from the index fourbusiness days later (or on the following business day if this is a non-business day).
However, stocks that are listed on more than one market and not designated for delisting
on one or more of the markets will not be removed.
3.2.2. Delisting
Stocks delisted for reasons other than those noted in 3.1 will be removed from the index
on the delisting date.
3.2.3. Marked loss of eligibility for inclusion in stock selection universe
If there are grounds considered to disqualify a constituent stock from inclusion in the stock
selection universe in 2.1, as defined below, the stock may be removed from the index
following an official announcement by the company in question, the stock exchange, or agovernment/regulatory agency. However, if after its removal the grounds for removal
cease to apply, it will no longer be deemed ineligible for inclusion in the stock selection
universe at the time of the next periodic reconfiguration.

21.
22.

This rule applies to changes from April 2002 onwards.
This rule applies from 21 April 2010. Through 28 December 2001, stocks designated for delisting were
removed on the date of the designation. Effective from 29 December 2001 through 23 August 2009, they
were removed two business days after the date of designation for delisting, and from 24 August 2009
through 20 April 2010 they were removed three business days after the date of designation for delisting.

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4. Index calculation
4.1. Index calculation method
4.1.1. Index base date, index base value, announcement date
The base date for the Nomura Enterprise Value Allocation Index is 17 August 2001, andthe value of the index on the base date (its base value) is 10,000. The index was
launched on 15 April 2016.
4.1.2. Calculation of index market cap

4.1.3. Calculation of index values
Base market capitalization is used in the calculations set out below in order to prevent
index values from being affected by changes in market cap that are not due to fluctuations
in market prices (for example, changes in market cap that are due to changes in capital
structure and in index constituent stocks).
• Index excluding dividends• Index including dividends• Method for reflecting dividends
For the index including dividends, dividend data are reflected on the ex-dividend date.
However, as the value of the dividend has not yet been determined on the exdividend date, the stock issuer’s dividend forecast is used (if this is unavailable, theToyo Keizai dividend forecast is used)[23] . In the event of a difference between thedividend forecast and the actual dividend, the base market capitalization is adjusted
on the last business day of the month of the earnings announcement (if the earnings
announcement is made on the last business day of the month, the base market
capitalization is adjusted on the last business day of the following month). In addition,
if dividend adjustment is required, the base market capitalization is adjusted on thelast business day of the month in which this became clear (if the day in which thisbecame clear is the last business day of the month, the base market capitalization isadjusted on the last business day of the following month).

23.

This rule applies to accounting periods ending end-December 2011 onwards. For periods before this, theactual dividend on the ex-dividend date is used.

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4.2. Adjusting the base market capitalization
The base market capitalization is adjusted in the following way if there is a change incapital structure or in index constituent stocks. However, no adjustment is made to basemarket capitalization to reflect changes in capital structure that do not involve payment,such as stock splits, reverse stock splits, and changes in face value, as these do notaffect market capitalization.
Fig. 3: Timing of adjustments resulting from changes in capital structure

Change in capital structure
Stock transfer, stock swap, merger

Adjustment date
Date of listing change

Stock

Corporate divestiture (company/division
Ex-rights datereplacement spinoff)

Capitalincrease

Not used[24]Replacement datePrevious day's price

Rights offering

Ex-rights dateIssue price

Gratis allocation of stock acquisitionrightsEx-rights date

Exercise price

Gratis allocation of treasury stock

Ex-rights datePrevious day's price

Public offering

Business day following payment date (listing date of
new shares when settlement is on issuance date)Previous day's price

Capital increase via third-party
placement

Five business days after date of listing change

Previous day's price

Conversion of preferred stock

Last business day of month in which number ofconverted shares becomes known

Previous day's price

Last business day of month in which number of newshares for which rights were exercised becomesknown

Previous day's priceCorporate divestiture (new stock incontinuing company)

Date of listing change

Previous day's price

Retirement of treasury stock

Last business day of month following month oftreasury stock retirement

Previous day's price

Rights offering refusal

Last business day of month in which rights offering
refusal is announced (or last business day of following
Previous day's pricemonth if announcement is within five business days ofmonth-end)

Capital reduction with compensation

Effective date

Other adjustments

Other adjustments to base market capitalization, if
required, are made on the last business day of themonth of the disclosure of the relevant information (orPrevious day's pricethe last business day of the following month if thedisclosure is made within five business days of themonth-end)

Exercise of stock acquisition rights

Other

Previous day's price

Stock replacement

Conversion of CBs

Capitalreduction

Share price used

Previous day's priceSource: Nomura

24.

In the case of a corporate divestiture (company/division spinoff), the base market capitalization is adjusted
for the reduction in capital. The reduction in capital is defined as follows: (1) when the divesting entity does
not announce the value of the divested division or of the shares of the divested (spun-off) company, capitalis reduced by the amount by which the divesting entity’s shareholders' equity is expected to be reduced, and(2) when the divesting entity does announce the value of the divested division or of the shares of thedivested (spun-off) company, capital is reduced by the value of the division or the value of the divested
company's shares multiplied by the total number of shares.

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4.3. Index maintenanceConstituent stocks are also replaced in periodic and unscheduled reconfigurations andwhen necessary for other reasons. In addition, when the following changes in capital
structure result in a change in the number of shares outstanding for index calculation
purposes, the index inclusion ratio is changed so that number of shares in the stock thatare included in the index does not change.
•
•
•
•
•
•
•
•
•
•
•
•

25.

Stock transfer, stock swap, merger[25]Rights offering
Gratis allocation of stock acquisition rights
Public offering
Capital increase via third-party placement
Conversion of preferred shares
Conversion of CBs, exercise of stock acquisition rights
Corporate divestiture (new stock in surviving company)
Retirement of treasury stock
Rights offering refusal
Capital reduction with compensation
Other adjustments

When an index constituent becomes a wholly owned subsidiary (or merged company), the index inclusion
ratio of the parent (or surviving company) is changed so that the total number of shares in the index remains
the same as it was before, taking the exchange ratio (or merger ratio) into account.

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5. Data publication services
Data for the Nomura Enterprise Value Allocation Index can be obtained via the following
channels[26] .

Index values will be published in the following media:
Bloomberg:
QUICK:
REUTERS:Our website:NMRI
SNJPEVA/NRIJ.NEVA (excluding dividends), .NEVATR (including dividends)
http://qr.nomura.co.jp/jp/neva/index.html (Japanese only)

Contact
Nomura Securities, Tokyo
Global Research Division, Financial Engineering & Technology Research CenterIndex Operations Dept.
e-mail: idx_mgr@frc.nomura.co.jp
The Nomura Enterprise Value Allocation Index is released by Nomura Securities Co., Ltd.
("Nomura") and its intellectual and all other rights belong to Nomura. Nomura does notguarantee the accuracy, completeness, reliability, usefulness, marketability,
merchantability or fitness of the index, and does not take any responsibility for businessactivities or services that any index user and/or its affiliates undertakes with the use of theindex.
A license agreement with Nomura is required to use the index and access detailed data.
In the case of an unavoidable event such as computer breakdown or natural disaster,
calculation of the Index may be delayed or suspended.
While every effort is made to ensure that the information used in this report and all
published information is based on reliable data, it should be noted that data may bechanged or amended when necessary.

26.

Published data are all for reference only.

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Policies with regard to Nomura Securities
Co., (NSC)’s indices
The below index-related policies are published on our website.
See the following link for details:

http://qr.nomuraholdings.com/en/guides/index.html
•
•
•
•
•

Index Governance Framework
Conflicts of Interest Policy
Index Calculation Policy
Glossary (Equity)
Complaints Handling Policy

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Appendix A-1
Analyst Certification
I, Index Operations Dept., hereby certify (1) that the views expressed in this Research report accurately reflect my personalviews about any or all of the subject securities or issuers referred to in this Research report, (2) no part of my compensation
was, is or will be directly or indirectly related to the specific recommendations or views expressed in this Research report and (3)no part of my compensation is tied to any specific investment banking transactions performed by Nomura Securities
International, Inc., Nomura International plc or any other Nomura Group company.

Important Disclosures
The lists of issuers that are affiliates or subsidiaries of Nomura Holdings Inc., the parent company of Nomura Securities Co., Ltd., issuers thathave officers who concurrently serve as officers of Nomura Securities Co., Ltd., issuers in which the Nomura Group holds 1% or more of any
class of common equity securities and issuers for which Nomura Securities Co., Ltd. has lead managed a public offering of equity or equity
linked securities in the past 12 months are available at https://www.nomuraholdings.com/report/ . Please contact the Research Production
Operation Dept. of Nomura Securities Co., Ltd. for additional information.

Online availability of research and conflict-of-interest disclosures
Nomura Group research is available on www.nomuranow.com/research, Bloomberg, Capital IQ, Factset, Reuters and ThomsonOne.
Important disclosures may be read at http://go.nomuranow.com/research/globalresearchportal/pages/disclosures/disclosures.aspx or requested
from Nomura Securities International, Inc. If you have any difficulties with the website, please email grpsupport@nomura.com for help.
The analysts responsible for preparing this report have received compensation based upon various factors including the firm's total revenues, aportion of which is generated by Investment Banking activities. Unless otherwise noted, the non-US analysts listed at the front of this report are
not registered/qualified as research analysts under FINRA rules, may not be associated persons of NSI, and may not be subject to FINRA Rule
2241 restrictions on communications with covered companies, public appearances, and trading securities held by a research analyst account.
Nomura Global Financial Products Inc. (NGFP) Nomura Derivative Products Inc. (NDP) and Nomura International plc. (NIplc) are registered with
the Commodities Futures Trading Commission and the National Futures Association (NFA) as swap dealers. NGFP, NDPI, and NIplc are
generally engaged in the trading of swaps and other derivative products, any of which may be the subject of this report.

Distribution of ratings (Nomura Group)
The distribution of all ratings published by Nomura Group Global Equity Research is as follows:
56% have been assigned a Buy rating which, for purposes of mandatory disclosures, are classified as a Buy rating; 38% of companies with thisrating are investment banking clients of the Nomura Group*. 0% of companies (which are admitted to trading on a regulated market in the EEA)
with this rating were supplied material services** by the Nomura Group.
41% have been assigned a Neutral rating which, for purposes of mandatory disclosures, is classified as a Hold rating; 60% of companies withthis rating are investment banking clients of the Nomura Group*. 0% of companies (which are admitted to trading on a regulated market in the
EEA) with this rating were supplied material services by the Nomura Group
3% have been assigned a Reduce rating which, for purposes of mandatory disclosures, are classified as a Sell rating; 12% of companies withthis rating are investment banking clients of the Nomura Group*. 0% of companies (which are admitted to trading on a regulated market in the
EEA) with this rating were supplied material services by the Nomura Group.
As at 31 March 2022.
*The Nomura Group as defined in the Disclaimer section at the end of this report.
** As defined by the EU Market Abuse Regulation

Definition of Nomura Group's equity research rating system and sectors
The rating system is a relative system, indicating expected performance against a specific benchmark identified for each individual stock,subject to limited management discretion. An analyst’s target price is an assessment of the current intrinsic fair value of the stock based on an
appropriate valuation methodology determined by the analyst. Valuation methodologies include, but are not limited to, discounted cash flow
analysis, expected return on equity and multiple analysis. Analysts may also indicate expected absolute upside/downside relative to the statedtarget price, defined as (target price - current price)/current price.

STOCKSA rating of 'Buy', indicates that the analyst expects the stock to outperform the Benchmark over the next 12 months. A rating of 'Neutral',indicates that the analyst expects the stock to perform in line with the Benchmark over the next 12 months. A rating of 'Reduce', indicates thatthe analyst expects the stock to underperform the Benchmark over the next 12 months. A rating of 'Suspended', indicates that the rating, target
price and estimates have been suspended temporarily to comply with applicable regulations and/or firm policies. Securities and/or companies
that are labelled as 'Not rated' or shown as 'No rating' are not in regular research coverage. Investors should not expect continuing or

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additional information from Nomura relating to such securities and/or companies. Benchmarks are as follows: United States/Europe/Asia exJapan: please see valuation methodologies for explanations of relevant benchmarks for stocks, which can be accessed at:
http://go.nomuranow.com/research/globalresearchportal/pages/disclosures/disclosures.aspx; Global Emerging Markets (ex-Asia): MSCIEmerging Markets ex-Asia, unless otherwise stated in the valuation methodology; Japan: Russell/Nomura Large Cap.

SECTORSA 'Bullish' stance, indicates that the analyst expects the sector to outperform the Benchmark during the next 12 months. A 'Neutral' stance,
indicates that the analyst expects the sector to perform in line with the Benchmark during the next 12 months. A 'Bearish' stance, indicates thatthe analyst expects the sector to underperform the Benchmark during the next 12 months. Sectors that are labelled as 'Not rated' or shown as'N/A' are not assigned ratings. Benchmarks are as follows: United States: S&P 500; Europe: Dow Jones STOXX 600; Global Emerging
Markets (ex-Asia): MSCI Emerging Markets ex-Asia. Japan/Asia ex-Japan: Sector ratings are not assigned.

Target Price
A Target Price, if discussed, indicates the analyst’s forecast for the share price with a 12-month time horizon, reflecting in part the analyst's
estimates for the company's earnings. The achievement of any target price may be impeded by general market and macroeconomic trends, andby other risks related to the company or the market, and may not occur if the company's earnings differ from estimates.

Disclaimers

This publication contains material that has been prepared by the Nomura Group entity identified on page 1 and, if applicable, with thecontributions of one or more Nomura Group entities whose employees and their respective affiliations are specified on page 1 or identified
elsewhere in this publication. The term "Nomura Group" used herein refers to Nomura Holdings, Inc. and its affiliates and subsidiaries including:(a) Nomura Securities Co., Ltd. ('NSC') Tokyo, Japan, (b) Nomura Financial Products Europe GmbH (‘NFPE’), Germany, (c) Nomura
International plc ('NIplc'), UK, (d) Nomura Securities International, Inc. ('NSI'), New York, US, (e) Nomura International (Hong Kong) Ltd.
(‘NIHK’), Hong Kong, (f) Nomura Financial Investment (Korea) Co., Ltd. (‘NFIK’), Korea (Information on Nomura analysts registered with the
Korea Financial Investment Association ('KOFIA') can be found on the KOFIA Intranet at http://dis.kofia.or.kr, (g) Nomura Singapore Ltd. (‘NSL’),Singapore (Registration number 197201440E, regulated by the Monetary Authority of Singapore) (h) Nomura Australia Ltd. (‘NAL’), Australia(ABN 48 003 032 513), regulated by the Australian Securities and Investment Commission ('ASIC') and holder of an Australian financial services
licence number 246412, (i) Nomura Securities Malaysia Sdn. Bhd. (‘NSM’), Malaysia, (j) NIHK, Taipei Branch (‘NITB’), Taiwan, (k) Nomura
Financial Advisory and Securities (India) Private Limited (‘NFASL’), Mumbai, India (Registered Address: Ceejay House, Level 11, Plot F,
Shivsagar Estate, Dr. Annie Besant Road, Worli, Mumbai- 400 018, India; Tel: 91 22 4037 4037, Fax: 91 22 4037 4111; CIN No:
U74140MH2007PTC169116, SEBI Registration No. for Stock Broking activities : INZ000255633; SEBI Registration No. for Merchant Banking :INM000011419; SEBI Registration No. for Research: INH000001014. ‘CNS Thailand’ next to an analyst’s name on the front page of a research
report indicates that the analyst is employed by Capital Nomura Securities Public Company Limited (‘CNS’) to provide research assistanceservices to NSL under an agreement between CNS and NSL. ‘NSFSPL’ next to an employee’s name on the front page of a research report
indicates that the individual is employed by Nomura Structured Finance Services Private Limited to provide assistance to certain Nomura
entities under inter-company agreements. 'Verdhana' next to an individual's name on the front page of a research report indicates that theindividual is employed by PT Verdhana Sekuritas Indonesia ('Verdhana') to provide research assistance to NIHK under a research partnershipagreement and neither Verdhana nor such individual is licensed outside of Indonesia. For the avoidance of doubt and for the purpose of
disclosure, Nomura Orient International Securities Co., Ltd (“NOI”), a joint venture amongst Nomura Group, Orient International (Holding) Co.,Ltd and Shanghai Huangpu Investment Holding (Group) Co., Ltd is excluded from the definition of Nomura Group. An individual name printed
next to NOI on the front page of a research report indicates that individual is employed by NOI to provide research assistance to NIHK under aresearch partnership agreement and neither NOI or such individual is licensed outside of Mainland China, PRC.
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Other than disclosures relating to the Nomura Group, the Nomura Group does not warrant, represent or undertake, express or implied, that the
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Opinions or estimates expressed are current opinions as of the original publication date appearing on this material and the information, including
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as principal, agent, or otherwise, or have long or short positions in, or buy or sell, the securities, commodities or instruments, or options or otherderivative instruments based thereon, of issuers or securities mentioned herein. The Nomura Group companies may also act as market makeror liquidity provider (within the meaning of applicable regulations in the UK) in the financial instruments of the issuer. Where the activity of18

Nomura | Nomura Enterprise Value Allocation Index

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market maker is carried out in accordance with the definition given to it by specific laws and regulations of the US or other jurisdictions, this will
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This document may contain information obtained from third parties, including, but not limited to, ratings from credit ratings agencies such as
Standard & Poor’s. The Nomura Group hereby expressly disclaims all representations, warranties or undertakings of originality, fairness,accuracy, completeness, correctness, merchantability or fitness for a particular purpose with respect to any of the information obtained fromthird parties contained in this material or otherwise arising in connection therewith, and shall not be liable (in negligence or otherwise, and inwhole or in part) for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses,
legal fees, or losses (including lost income or profits and opportunity costs) in connection with any use or misuse of any of the information
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or misuse of such content. Third-party content providers give no express or implied warranties, including, but not limited to, any warranties ofmerchantability or fitness for a particular purpose or use. Third-party content providers shall not be liable (in negligence or otherwise, and inwhole or in part) for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses,
legal fees, or losses (including lost income or profits and opportunity costs) in connection with any use or misuse of their content, including
ratings. Credit ratings are statements of opinions and are not statements of fact or recommendations to purchase hold or sell securities. They do
not address the suitability of securities or the suitability of securities for investment purposes, and should not be relied on as investment advice.
Any MSCI sourced information in this document is the exclusive property of MSCI Inc. (‘MSCI’). Without prior written permission of MSCI, thisinformation and any other MSCI intellectual property may not be duplicated, reproduced, re-disseminated, redistributed or used, in whole or inpart, for any purpose whatsoever, including creating any financial products and any indices. This information is provided on an "as is" basis. The
user assumes the entire risk of any use made of this information. MSCI, its affiliates and any third party involved in, or related to, computing orcompiling the information hereby expressly disclaim all representations, warranties or undertakings of originality, fairness, accuracy,completeness, correctness, merchantability or fitness for a particular purpose with respect to any of this material or the information contained inthis material or otherwise arising in connection therewith. Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any
third party involved in, or related to, computing or compiling the information have any liability (in negligence or otherwise, and in whole or in part)for any damages of any kind. MSCI and the MSCI indexes are services marks of MSCI and its affiliates.
The intellectual property rights and any other rights, in Russell/Nomura Japan Equity Index belong to Nomura Securities Co., Ltd. ("Nomura")and Frank Russell Company ("Russell"). Nomura and Russell do not guarantee fairness, accuracy, completeness, correctness, reliability,
usefulness, marketability, merchantability or fitness of the Index, and do not account for business activities or services that any index user
and/or its affiliates undertakes with the use of the Index.
Investors should consider this document as only a single factor in making their investment decision and, as such, the report should not beviewed as identifying or suggesting all risks, direct or indirect, that may be associated with any investment decision. Nomura Group produces a
number of different types of research product including, among others, fundamental analysis and quantitative analysis; recommendations
contained in one type of research product may differ from recommendations contained in other types of research product, whether as a result ofdiffering time horizons, methodologies or otherwise. The Nomura Group publishes research product in a number of different ways including theposting of product on the Nomura Group portals and/or distribution directly to clients. Different groups of clients may receive different products
and services from the research department depending on their individual requirements.
Figures presented herein may refer to past performance or simulations based on past performance which are not reliable indicators of future or
likely performance. Where the information contains an expectation, projection or indication of future performance and business prospects, suchforecasts may not be a reliable indicator of future or likely performance. Moreover, simulations are based on models and simplifying
assumptions which may oversimplify and not reflect the future distribution of returns. Any figure, strategy or index created and published forillustrative purposes within this document is not intended for “use” as a “benchmark” as defined by the European Benchmark Regulation.
Certain securities are subject to fluctuations in exchange rates that could have an adverse effect on the value or price of, or income derived
from, the investment.
With respect to Fixed Income Research: Recommendations fall into two categories: tactical, which typically last up to three months; or strategic,
which typically last from 6-12 months. However, trade recommendations may be reviewed at any time as circumstances change. ‘Stop loss’
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The securities described herein may not have been registered under the US Securities Act of 1933 (the ‘1933 Act’), and, in such case, may not
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This document has been approved for distribution in the UK as investment research by NIplc. NIplc is authorised by the Prudential Regulation
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This document has been approved by NIHK, which is regulated by the Hong Kong Securities and Futures Commission, for distribution in Hong
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Disclaimers required in Japan
Credit ratings in the text that are marked with an asterisk (*) are issued by a rating agency not registered under Japan’s Financial Instruments
and Exchange Act (“Unregistered Ratings”). For details on Unregistered Ratings, please contact the Research Production Operation Dept. of
Nomura Securities Co., Ltd.
Investors in the financial products offered by Nomura Securities may incur fees and commissions specific to those products (for example,
transactions involving Japanese equities are subject to a sales commission (all figures on a tax-inclusive basis) of up to 1.43% of the transaction
amount or a commission of ¥2,860 for transactions of ¥200,000 or less, while transactions involving investment trusts are subject to various
fees, such as commissions at the time of purchase and asset management fees, such as commissions at the time of purchase and asset
management fees (trust fees), specific to each investment trust).

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In addition, all products carry the risk of losses owing to price fluctuations or other factors. Fees and risks vary by product. Please thoroughly
read the written materials provided, such as documents delivered before making a contract, listed securities documents, or prospectuses.
Transactions involving Japanese equities (including Japanese REITs, Japanese ETFs, and Japanese ETNs, Japanese Infrastructure Funds)
are subject to a sales commission of up to 1.43% (tax included) of the transaction amount (or a commission of ¥2,860 (tax included) for
transactions of ¥200,000 or less). When Japanese equities are purchased via OTC transactions (including offerings), only the purchase priceshall be paid, with no sales commission charged. However, Nomura Securities may charge a separate fee for OTC transactions, as agreed withthe customer. Japanese equities carry the risk of losses owing to price fluctuations. Japanese REITs carry the risk of losses owing tofluctuations in price and/or earnings of underlying real estate. Japanese ETFs and ETNs carry the risk of losses owing to fluctuations in theunderlying indexes or other benchmarks. Japanese Infrastructure Funds carry out the risk of losses owing to fluctuations in price and/or
earnings of underlying infrastructures.
Transactions involving foreign equities are subject to a domestic sales commission of up to 1.045% (tax included) of the transaction amount(which equals the local transaction amount plus local fees and taxes in the case of a purchase or the local transaction amount minus local fees
and taxes in the case of a sale) (for transaction amounts of ¥750,000 and below, maximum domestic sales commission is ¥7,810 (taxincluded)). Local fees and taxes in foreign financial instruments markets vary by country/territory. When foreign equities are purchased via OTC
transactions (including offerings), only the purchase price shall be paid, with no sales commission charged. However, Nomura Securities may
charge a separate fee for OTC transactions, as agreed with the customer. Foreign equities carry the risk of losses owing to factors such as pricefluctuations and foreign exchange rate fluctuations.
Margin transactions are subject to a sales commission of up to 1.43% (tax included) of the transaction amount (or a commission of ¥2,860 (taxincluded) for transactions of ¥200,000 or less), as well as management fees and rights handling fees. In addition, long margin transactions are
subject to interest on the purchase amount, while short margin transactions are subject to fees for the lending of the shares borrowed. A marginequal to at least 30% of the transaction amount (at least 33% for online transactions) and at least ¥300,000 is required. With margintransactions, an amount up to roughly 3.3x the margin (roughly 3x for online transactions) may be traded. Margin transactions therefore carry
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Transactions involving convertible bonds are subject to a sales commission of up to 1.10% (tax included) of the transaction amount (or acommission of ¥4,400 (tax included) if this would be less than ¥4,400). When convertible bonds are purchased via OTC transactions (including
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OTC transactions, as agreed with the customer. Convertible bonds carry the risk of losses owing to factors such as interest rate fluctuations andprice fluctuations in the underlying stock. In addition, convertible bonds denominated in foreign currencies also carry the risk of losses owing tofactors such as foreign exchange rate fluctuations.
When bonds are purchased via public offerings, secondary distributions, or other OTC transactions with Nomura Securities, only the purchaseprice shall be paid, with no sales commission charged. Bonds carry the risk of losses, as prices fluctuate in line with changes in market interest
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circumstances of the issuer, or changes in third-party valuations of the bond in question. In addition, foreign currency-denominated bonds also
carry the risk of losses owing to factors such as foreign exchange rate fluctuations.
When Japanese government bonds (JGBs) for individual investors are purchased via public offerings, only the purchase price shall be paid, withno sales commission charged. As a rule, JGBs for individual investors may not be sold in the first 12 months after issuance. When JGBs forindividual investors are sold before maturity, an amount calculated via the following formula will be subtracted from the par value of the bondplus accrued interest: (1) for 10-year variable rate bonds, an amount equal to the two preceding coupon payments (before tax) x 0.79685 will be
used, (2) for 5-year and 3-year fixed rate bonds, an amount equal to the two preceding coupon payments (before tax) x 0.79685 will be used.
When inflation-indexed JGBs are purchased via public offerings, secondary distributions (uridashi deals), or other OTC transactions with
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prices fluctuate in line with changes in market interest rates and fluctuations in the nationwide consumer price index. The notional principal of
inflation-indexed JGBs changes in line with the rate of change in nationwide CPI inflation from the time of its issuance. The amount of the
coupon payment is calculated by multiplying the coupon rate by the notional principal at the time of payment. The maturity value is the amountof the notional principal when the issue becomes due. For JI17 and subsequent issues, the maturity value shall not undercut the face amount.
Purchases of investment trusts (and sales of some investment trusts) are subject to a purchase or sales fee of up to 5.5% (tax included) of thetransaction amount. Also, a direct cost that may be incurred when selling investment trusts is a fee of up to 2.0% of the unit price at the time ofredemption. Indirect costs that may be incurred during the course of holding investment trusts include, for domestic investment trusts, an asset
management fee (trust fee) of up to 5.5% (tax included/annualized basis) of the net assets in trust, as well as fees based on investment
performance. Other indirect costs may also be incurred. For foreign investment trusts, indirect fees may be incurred during the course of holding
such as investment company compensation.
Investment trusts invest mainly in securities such as Japanese and foreign equities and bonds, whose prices fluctuate. Investment trust unit
prices fluctuate owing to price fluctuations in the underlying assets and to foreign exchange rate fluctuations. As such, investment trusts carry
the risk of losses. Fees and risks vary by investment trust. Maximum applicable fees are subject to change; please thoroughly read the writtenmaterials provided, such as prospectuses or documents delivered before making a contract.
In interest rate swap transactions and USD/JPY basis swap transactions (“interest rate swap transactions, etc.”), only the agreed transaction
payments shall be made on the settlement dates. Some interest rate swap transactions, etc. may require pledging of margin collateral. In someof these cases, transaction payments may exceed the amount of collateral. There shall be no advance notification of required collateral value or
collateral ratios as they vary depending on the transaction. Interest rate swap transactions, etc. carry the risk of losses owing to fluctuations inmarket prices in the interest rate, currency and other markets, as well as reference indices. Losses incurred as such may exceed the value ofmargin collateral, in which case margin calls may be triggered. In the event that both parties agree to enter a replacement (or termination)transaction, the interest rates received (paid) under the new arrangement may differ from those in the original arrangement, even if terms otherthan the interest rates are identical to those in the original transaction. Risks vary by transaction. Please thoroughly read the written materials

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provided, such as documents delivered before making a contract and disclosure statements.
In OTC transactions of credit default swaps (CDS), no sales commission will be charged. When entering into CDS transactions, the protection
buyer will be required to pledge or entrust an agreed amount of margin collateral. In some of these cases, the transaction payments may exceed
the amount of margin collateral. There shall be no advance notification of required collateral value or collateral ratios as they vary depending on
the financial position of the protection buyer. CDS transactions carry the risk of losses owing to changes in the credit position of some or all of
the referenced entities, and/or fluctuations of the interest rate market. The amount the protection buyer receives in the event that the CDS is
triggered by a credit event may undercut the total amount of premiums that he/she has paid in the course of the transaction. Similarly, theamount the protection seller pays in the event of a credit event may exceed the total amount of premiums that he/she has received in thetransaction. All other conditions being equal, the amount of premiums that the protection buyer pays and that received by the protection seller
shall differ. In principle, CDS transactions will be limited to financial instruments business operators and qualified institutional investors.
Transfers of equities to another securities company via the Japan Securities Depository Center are subject to a transfer fee of up to ¥11,000(tax included) per issue transferred depending on volume. No account fee will be charged for marketable securities or monies deposited.

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