Pls criticize my thesis

An Unknown Japanese Company in a Supposedly Dead Industry, Trading at 1.9x EV/EBIT, 4.5x P/E, and 0.6x P/BV!!! If I mention the Japanese digital camera industry, most people immediately assume it is dead or in terminal decline. After all, smartphones have replaced cameras for everyday photography. That view is only partly true. The Japanese digital camera industry did decline, but it has already passed its trough and is now recovering. According to shipment data from the Camera and Imaging Products Association (CIPA), digital camera sales reached a trough in 2020 and have nearly doubled since then by 2024. (https://www.cipa.jp/stats/documents/common/cr300.pdf) While fewer digital cameras are being sold, average selling prices have risen significantly, resulting in higher and growing total sales value. Casual users who only need “good enough” photos have exited the market. What remains is a smaller but more serious group of buyers who demand high image quality and are willing to pay a premium for it. The underlying reason is that smartphones cannot fully replace digital cameras. High-quality photography requires large image sensors and large lenses to capture light. This physics constraint sets a hard limit on what smartphones can achieve. Thai Mitsuwa Public Company Limited (“TMW”) is well-positioned to benefit from the ongoing rebound in the Japanese digital camera market. TMW owns and operates manufacturing facilities in Thailand and specializes in producing magnesium camera body components for leading Japanese digital camera manufacturers, including Sony, Nikon, Canon, and Fujifilm. TMW is a dominant player in this niche, with an estimated market share of over 80%. As the Japanese digital camera industry recovers, TMW’s revenue and profitability have rebounded accordingly. FY2020 - FY2025 \- Revenue CAGR: 6% \- Net Profit CAGR: 15% FY2025 ROE: 15% Manufacturing and molding magnesium is technically challenging, as the material is highly flammable and prone to explosion if not handled properly. In addition, camera body components are complex and require precise manufacturing capabilities. Moreover, TMW’s parent company in Japan has been operating since 1959 and has built long-standing relationships with its customers. In Japanese business culture, relationships with trusted partners tend to be maintained over long periods unless a critical issue arises. As a result, it is difficult for competitors to displace TMW and capture its market share. TMW has no difficulty converting net profit into cash and is run in a conservative, Japanese-style manner. The company carries no long-term debt, and its net cash position exceeds half of its market capitalization. The company maintains a technical consultation agreement with its parent, under which up to 3% of revenue is paid as a fee. This arrangement appears reasonable, as the parent company serves as the primary marketing arm and manages client relationships. Beyond this, TMW has no questionable related-party transactions, and its financial reporting appears clean. TMW is committed to a 30% dividend payout ratio, with the dividend yield for FY2025 at approximately 6%. The CEO is a member of the Yamada family, which effectively owns around 39% of the company, aligning management’s interests with shareholders. Despite these strengths, TMW continues to trade at depressed valuation multiples on the Stock Exchange of Thailand. EV/EBIT: 1.9x P/E: 4.5x P/BV: 0.6x This is largely because investors view the digital camera industry as structurally declining and because the Thai stock market has been one of the world’s weakest performers, posting a roughly 10% decline in 2025. That said, investing in TMW is not without risk. The company’s automotive plastic parts business is in decline. Automotive plastic components account for 57.24% of the plastics segment and approximately 22% of total revenue in FY2025. This business segment contracted by more than 17% in FY2025, driven by intensifying competition faced by Japanese automakers, TMW’s primary customers, from Chinese manufacturers. In summary, the investment thesis for TMW rests on the continued recovery of the digital camera industry. Growth in profits from the magnesium camera body parts business is expected to more than offset the decline in the automotive plastics segment over time.