Japan Experts, Extraordinary Performance, Astris Advisory Japan

Astris Advisory Japan

Japan Experts, Extraordinary Performance

Our Corporate Advisory service is designed to give clients access to a wider range of investors. These include Japan specialists as well as global investors. The goal is to help achieve a fair equity valuation.

Equity Bottom-Up

<ul><li>Despite some one-off inbound travel disruption during June to August 2025, Q1-2 FY3/26 results demonstrated strong and sustained YoY growth.</li><li>We interpret this as Polaris’s earnings stream becoming more resilient and predictable, with improved quality of earnings.</li><li>FY3/26 guidance has been upwardly revised, indicating robust earnings visibility for Q3-4 FY3/26, and the company has increased DPS to ¥4.0 from ¥3.0, with capital allocation demonstrating a well-structured balance between active growth investments and improving shareholder returns. </li></ul>

Despite some one-off inbound travel disruption during June to August 2025, Q1-2 FY3/26 results demonstrated strong and sustained YoY growth.We interpret this as Polaris’s earnings stream becoming more resilient and predictable, with improved quality of earnings.FY3/26 guidance has been upwardly revised, indicating robust earnings visibility for Q3-4 FY3/26, and the company has increased DPS to ¥4.0 from ¥3.0, with capital allocation demonstrating a well-structured balance between active growth investments and improving shareholder returns. 

Polaris Holdings (3010 JP) -  Durable Earnings Point to Improved Earnings Quality

<ul>
<li>Supported by Star Asia Group, Polaris Holdings now operates six hotel brands and is scaling up with a goal of 100 hotels and 15,000 rooms by FY3/27.</li>
<li>Shifting to a low-risk, fee-based model and a well-balanced fixed and variable lease structure to optimize risk-adjusted returns, its strategic mix of assets is enhancing earnings stability and growth potential.</li>
<li>Backed by strong financial foundations and effective capital deployment, Polaris is also expanding into new hotel types, strengthening its platform, and positioning for sustainable, scalable growth amid rising inbound demand. </li>
</ul>


Supported by Star Asia Group, Polaris Holdings now operates six hotel brands and is scaling up with a goal of 100 hotels and 15,000 rooms by FY3/27.
Shifting to a low-risk, fee-based model and a well-balanced fixed and variable lease structure to optimize risk-adjusted returns, its strategic mix of assets is enhancing earnings stability and growth potential.
Backed by strong financial foundations and effective capital deployment, Polaris is also expanding into new hotel types, strengthening its platform, and positioning for sustainable, scalable growth amid rising inbound demand. 


Polaris Holdings (3010 JP) - Scaling New Heights Through Strategic M&A and Surging Inbound Demand

<ul><li>Polaris delivered strong FY3/25 results, outperforming guidance with strong underlying OP growth of 109.0% YoY, driven by both organic growth and the Minacia acquisition.</li><li>Robust inbound tourism helped lift domestic RevPAR by 20.9% YoY, and the company surpassed its 10,000-room target ahead of its initial medium-term plan.</li><li>The company also shifted toward a fixed-plus-variable rent operating model that enables stable earnings over the medium to long term. </li></ul>

Polaris delivered strong FY3/25 results, outperforming guidance with strong underlying OP growth of 109.0% YoY, driven by both organic growth and the Minacia acquisition.Robust inbound tourism helped lift domestic RevPAR by 20.9% YoY, and the company surpassed its 10,000-room target ahead of its initial medium-term plan.The company also shifted toward a fixed-plus-variable rent operating model that enables stable earnings over the medium to long term. 

Polaris Holdings (3010 JP) - Full Steam Ahead with M&A, Inbound Demand, and Platform Scale

<ul><li>Credible track record of growth – Q1-3 FY3/25 results were in line with revised guidance, demonstrating high double-digit underlying OP growth with hotel operations continuing to experience robust demand.</li><li>With the completion of the acquisition and integration of Minacia in December 2024, the company has transformed into the tenth-largest limited-service hotel operator in Japan, demonstrating an elevated growth trajectory of 25.2% CAGR (2019-25) in hotel room expansion.</li><li>Upwardly revised company targets for FY3/27 aim to have 100 hotels and 15,000 hotel rooms on its operating platform, with the company already close to achieving this with its portfolio of 97 hotels and 14,964 rooms, which include eleven planned new openings.</li></ul>

Credible track record of growth – Q1-3 FY3/25 results were in line with revised guidance, demonstrating high double-digit underlying OP growth with hotel operations continuing to experience robust demand.With the completion of the acquisition and integration of Minacia in December 2024, the company has transformed into the tenth-largest limited-service hotel operator in Japan, demonstrating an elevated growth trajectory of 25.2% CAGR (2019-25) in hotel room expansion.Upwardly revised company targets for FY3/27 aim to have 100 hotels and 15,000 hotel rooms on its operating platform, with the company already close to achieving this with its portfolio of 97 hotels and 14,964 rooms, which include eleven planned new openings.

Polaris Holdings (3010 JP) -  Transformation to a Bona Fide Top-10 Player

<ul><li><strong>Strong underlying growth and strategic initiatives</strong>–The company continues to make the most out of positive market conditions in the hotel sector with a continued uptrend in lodging demand.</li><li>We estimate underlying OP growth of 69.5% YoY for Q1-2 FY3/25, driven by the hotel business, which continues to see positive occupancy rates and RevPAR growth KPIs.</li><li>To reflect this, the company is optimizing its hotel portfolio by switching four hotels to a fixed + variable rent lease agreement to capture more earnings upside and the acquisition of unlisted limited-service hotel operator Minacia, due to close in December 2024, which will bring further stability and growth opportunities to maximize corporate value for the medium to longer term.</li></ul>

Strong underlying growth and strategic initiatives–The company continues to make the most out of positive market conditions in the hotel sector with a continued uptrend in lodging demand.We estimate underlying OP growth of 69.5% YoY for Q1-2 FY3/25, driven by the hotel business, which continues to see positive occupancy rates and RevPAR growth KPIs.To reflect this, the company is optimizing its hotel portfolio by switching four hotels to a fixed + variable rent lease agreement to capture more earnings upside and the acquisition of unlisted limited-service hotel operator Minacia, due to close in December 2024, which will bring further stability and growth opportunities to maximize corporate value for the medium to longer term.

Polaris Holdings (3010 JP) - Capitalizing on Opportunities for Growth

Japan

Polaris Holdings Co., Ltd. operates and develops hotels. The Company provides catering, lodging, and other services. Polaris Holdings also operates real estate development.

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Polaris Holdings (3010 JP)