In today’s briefing:
- With Passive Funds Dominating Markets Today, Proxy Voting Tends to Be Limited to Formalities
- Lasertec Corp (6920 JP): Full-year FY06/25 flash update
- Tokyo Keiki Inc (7721 JP): Q1 FY03/26 flash update
- Anicom Holdings (8715 JP): Q1 FY03/26 flash update
- Sinanen Holdings (8132 JP): Q1 FY03/26 flash update
- Toyota Motor (7203 JP) Tactical Outlook After $10B Profit Cut on Tariff Impact
- Toyo Tanso (5310 JP): 1H FY12/25 flash update
- Japanese Big Cap Banks – Stick with Our Key Positive Picks
- Pilot Corp (7846 JP): 1H FY12/25 flash update
- Bando Chemical Industries (5195 JP): Q1 FY03/26 flash update
With Passive Funds Dominating Markets Today, Proxy Voting Tends to Be Limited to Formalities
- For asset management companies that mainly use passive funds, it is difficult to have sufficient dialogue with all portfolio companies equally in the environment where AGMs are concentrated in June.
- As more companies focus on meeting formal voting guidelines, there is a risk that the goal of improving corporate value through management reforms will be put aside.
- Solving individual management issues will lead to increased corporate value. However, due to physical reasons, not many companies engage in dialogue regarding individual management issues.
Lasertec Corp (6920 JP): Full-year FY06/25 flash update
- The company reported significant YoY growth in sales, operating profit, recurring profit, and net income, driven by AI semiconductor demand.
- FY06/25 orders and backlog decreased sharply YoY, with the company ceasing quarterly order disclosures and forecasting weaker future orders.
- The company plans increased R&D spending, reduced capital expenditures, and stable dividends, with a share repurchase program announced.
Tokyo Keiki Inc (7721 JP): Q1 FY03/26 flash update
- Q1 FY03/26 revenue rose 21.3% YoY to JPY10.5bn, with an order backlog of JPY58.5bn, up 21.3% YoY.
- Defense and Communications Equipment segment showed significant revenue growth, narrowing operating losses despite yen appreciation and higher SG&A expenses.
- Operating losses persisted across segments, influenced by increased R&D costs and changes in sales mix by end market.
Anicom Holdings (8715 JP): Q1 FY03/26 flash update
- Recurring revenue increased by 10.4% YoY to JPY18.2bn, driven by underwriting, investment, and non-insurance business growth.
- Recurring profit decreased by 40.7% YoY to JPY960mn, impacted by increased costs from AXA Direct insurance contract transfers.
- The combined ratio based on earned premiums rose 4.0pp YoY to 97.9%, influenced by higher medical costs and policy transfer expenses.
Sinanen Holdings (8132 JP): Q1 FY03/26 flash update
- Sales declined 0.6% YoY to JPY63.2bn, while operating profit rose 126.9% YoY to JPY726mn due to higher petroleum sales.
- Revenue rose 2.3% YoY to JPY15.5bn, driven by increased kerosene sales volume and lower SG&A expenses.
- Revenue and profit increased in bike sharing and systems businesses, but operating profit declined in building maintenance due to costs.
Toyota Motor (7203 JP) Tactical Outlook After $10B Profit Cut on Tariff Impact
- Toyota Motor (7203 JP) on Thursday announced it expected a profit hit of nearly $10 billion from US tariffs on cars imported into the USA.
- Toyota cut its full-year profit forecast by 16%, citing rising US tariffs on cars, parts, steel, aluminum, uncertainty in market outlook and supplier impacts.
- Our model does not see an overbought state at the moment and the stock was rallying on Friday, the forecast is: higher prices next week.
Toyo Tanso (5310 JP): 1H FY12/25 flash update
- Sales declined to JPY23.0bn (-12.6% YoY), with operating profit at JPY3.8bn (-33.9% YoY) and net income at JPY2.7bn (-48.0% YoY).
- FY12/25 forecast revised to sales of JPY48.0bn (-9.6% YoY) and operating profit of JPY7.5bn (-38.7% YoY).
- Dividend forecast maintained at JPY145.0 per share, with a payout ratio of 60.8% based on FY12/25 forecast.
Japanese Big Cap Banks – Stick with Our Key Positive Picks
- We update our proprietary scorecard and many of our charts based on the latest data; despite the recent lack of BoJ rate hikes, interest rate spreads are widening
- The JGB yield curve has continued to steepen, which is constructive for Japanese banks; in addition, market lending rates to June continue to rise faster than deposit rates
- We stick with our focus on two core attributes; gearing to higher interest rates and cross-holdings to market capitalization keeping Resona, Mizuho, Shizuoka and Kyoto on our list of buys
Pilot Corp (7846 JP): 1H FY12/25 flash update
- The company forecasts FY12/25 revenue of JPY133.0bn (+5.4% YoY) and operating profit of JPY18.0bn (+1.1% YoY).
- Revenue in the Japan segment is expected to increase 2.8% YoY, driven by new product sales and market recovery.
- The company plans JPY45.0bn in capital expenditures over three years, focusing on facility updates and technology investments.
Bando Chemical Industries (5195 JP): Q1 FY03/26 flash update
- Consolidated revenue in Q1 2025 was JPY29.1bn, marking a -0.9% YoY decline, the first in 18 quarters.
- Core operating profit rose 3.0% YoY to JPY2.0bn, with a margin improvement of 0.2pp to 6.9%.
- Operating profit increased 66.6% YoY to JPY3.8bn, while net income rose 37.3% YoY to JPY2.7bn.
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