Alphapolis: Manga/Anime Publisher With Unique Business Model

Jiro Yasu, Patrick Rial, and Jeff Musial of Varecs Partners presented their investment thesis on Alphapolis (Japan: 9467) at Asian Investing Summit 2025.

Thesis summary:

Alphapolis is a small-cap Japanese content company operating in the high-growth manga and anime sectors, two of Japan’s most culturally significant and globally expanding creative exports. The company has developed a distinctive content generation model by harnessing a user-generated content (UGC) platform to source successful manga series, which are later published and adapted into anime. This approach produces a hit rate far superior to traditional publishing models and enables Alphapolis to operate with gross margins of 73%, operating margins of 22%, and a return on invested capital of 33%. Over the past five years, Alphapolis has grown revenue and EBIT at CAGRs of 16% and 11%, respectively, with manga sales now accounting for 74% of total revenue, up from just 24% in 2014.

Alphapolis’s growth trajectory is underpinned by two structural tailwinds. First, the global manga and anime markets — estimated at $15 billion and $22 billion, respectively — have been compounding at high-single to double-digit rates, especially overseas, where anime viewership among Gen Z in markets like the U.S. has surged. Second, as Japanese content assets remain scarce and consolidation intensifies, Alphapolis stands out as a rare, undervalued pure-play in the space. With the success of its anime titles such as *Gate* and *Moonlit Fantasy*, the company is scaling production, with five new series in development and early monetization of related IP through licensing and merchandise.

The business model is capital-light and highly scalable. Alphapolis serves as a publisher, producer, and partial investor in anime productions, earning royalties and downstream revenue from streaming rights and merchandise. Its unique UGC-driven content pipeline, which converts digital light novels into manga and then anime, has enabled it to systematically identify hits with significantly reduced risk and cost. The success of this approach has been demonstrated by sales surges following anime releases and a deepening library of monetizable IP. Moreover, digital distribution, now dominant across the manga industry, has dramatically improved profitability and reduced return rates.

Alphapolis recently traded at 19x forward P/E (14x ex-cash) and just 8x EV/EBIT, well below global and domestic peers. A conservative DCF model implies intrinsic value of ¥54 billion versus a recent market cap of ¥37.5 billion, suggesting 44% upside. With scarcity value, global growth drivers, a proven content monetization engine, and optionality in new revenue streams like gaming and licensing, Alphapolis offers an asymmetric opportunity in one of Japan’s most dynamic creative industries.

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About the instructors:

Jiro Yasu has two decades of investment experience in the Japanese equity markets including at Varecs Partners, First Eagle Investment Management and Daiwa Securities America. As the Representative Director of Varecs Partners, Jiro spearheads the investment firm’s efforts to identify mid-sized listed Japanese companies where corporate value can be realized for all stakeholders by working together with management. Jiro holds a BA in economics with a specialty in econometrics from Keio University.

Patrick Rial joined Varecs Partners in 2015 as Senior Analyst. He joined from J.P. Morgan Securities Japan where he worked in equity strategy and small cap research. Prior to J.P. Morgan, he was a product manager at Morgan Stanley MUFG Securities. Mr. Rial began his career as a financial journalist covering Japanese equity markets. He has been a CFA charterholder since 2011. He holds a BA in economics and history from Georgetown University.

Jeff Musial joined Varecs Partners in 2021 as Senior Analyst. He joined from Burgundy Asset Management in Toronto where he was the Vice President of Asian Equities, focused on Japan. Prior to that, he worked in Asian Equities at RBC Global Asset Management in Hong Kong. Mr. Musial has been a CFA charterholder since 2015, and holds an International MBA from the Schulich School of Business in Canada. He also holds a BA in Psychology from the University of Western Ontario, and attended Nanjing University on a 1-year Mandarin studies scholarship.