Japan Markets View

“Children’s Agency” Related Stocks Are Gaining Attention Again by the Election
Published : Sep 06, 2021 Equity

[Nikkei QUICK News] On August 27, prices of the stocks related to the Children’s Agency rose overall in the Tokyo Stock Exchange. With the reports that the Liberal Democratic Party (LDP) will declare a commitment to enact the “Basic Law for Children” that will guarantee the rights of children for the general election of the House of Representatives to be held this autumn, “Children’s Agency” related stocks are gaining attention again. This could be one of the major themes of the coming political season.


The Yoshihide Suga administration has announced the establishment of the “Children’s Agency” to work across ministries and agencies on childcare policies. “Children’s Agency” related stocks are expected to benefit from the government’s measures to support child rearing, including benefits related to marriage, childbirth, and childcare, and support for the establishment of additional facilities to eliminate the children on nursery school waiting lists.


The stocks related to childbirth, childcare, and education widely rose on August 27. Baby Calendar Inc. (7363), operating an information media for childbirth and childcare, rose by 700 (+14%) from the previous day to 5,650, the upper limit of the price range. Youji Corp. (2152), involved in the training of physical education to early childhood, rose by 27% at one point, while Kids Smile Holdings (7084), developing early childhood education materials, rose by 8%


■ Commitment to gain popularity
Kyodo News reported, “The LDP’s ‘Children and Youth’ Shining Future Creation Headquarters, which is planning the establishment of the ‘Children’s Agency’, summarized its basic policy at a meeting on August 26. They included the enactment of the ‘Children-centered basic law (tentative name)’ to realize a children-friendly society.” The LDP is expected to make a public commitment to enact the ‘Basic Law for Children’ as a part of its campaign for the election to be held this autumn.


On the same day, Shigetoshi Kamada, general manager of the Research Department at Tachibana Securities, shared his view, “Expanding childcare support is likely to attract support from voters. Not only the LDP, but other parties are also expected to make similar commitments before the election, which is planned to be held this autumn.” The momentum is expected to continue for a while, with the election to be held in October.


Some have taken a cautious view. Takashi Hiroki, chief strategist at MONEX, pointed out, “One of the initial objectives of the Children’s Agency was to eliminate the vertical administrative structure. However discussions on ‘the unification of the kindergarten and nursery school systems’, which integrates the jurisdiction of kindergartens, nursery schools, and certified early childhood education and care centers into the agency, has not progressed. He added, “If the role-sharing between the Children’s Agency and the existing government agencies is unclear and concrete measures are not sufficiently clear, it will not last as an investment theme.”


In the field of education, which is said to be the permanent national policy, whether effective measures are taken will likely determine the price trends of related stocks.


Children's Agency related stocks_table




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