During the quarter, we initiated a position in Mabuchi Motor (TSE:6592), a manufacturer of miniature motors used primarily in automobiles. Mabuchi’s business has struggled over the past decade as demand for CD and DVD players contracted sharply. Mabuchi had a virtual monopoly on motors used in such products, which led to a significant decline in revenue. The bulk of its business now comes from the automotive industry, within which the adoption of certain motors is rising, and revenues seem to have finally turned a corner.
From Matthews Japan Fund (Trades, Portfolio)’s Second Quarter 2014 Commentary.
