AGC (5201) 1Q results: Beats market expectations even excluding one-time income

Research evidence excerpt

AGC (5201) 1Q results: Beats market expectations even excluding one-time income

JPMorgan Securities Japan Co., Ltd. Asia Pacific Equity Research

Mio Shikanai AC 13 May 2026 J P M O R G A N

(81-3) 6736 1313

mio.shikanai@jpmorgan.com

Investment Thesis, Valuation and Risks

AGC (5201) (Neutral; Price Target: ¥5,200)

Investment Thesis

Our focus is on progress toward margin improvement in existing core businesses and in

returning strategic businesses to a growth trajectory. With the core PVC/caustic acid

businesses accounting for a large percentage of total profits, we see strategic businesses

(bio-CDMO, image sensor glass filters, EUV mask blanks, fluorochemical-related

products) as key to reducing volatility. All of these are seeing strong market growth and have

unique positioning, but bio-CDMO is currently a slight drag on the overall segment and has

us awaiting recovery.

Valuation

We base our December 2026 price target of ¥5,200 on a sum-of-the-parts valuation using

EV/EBITDA and our FY2026 estimates. We use the EV/EBITDA multiples of

comparatives as reference and apply a 30% conglomerate discount.

Sum-of-the-parts model based on FY2026 estimates

FY12/26E (¥mn unless otherwise noted) EBITDA EV/EBITDA EV Per share

OP D&A (x) (JPY)

Architectural glass 46,600 21,400 25,200 6.5 302,900 1,393

Automotive 62,900 30,900 32,000 6.5 408,850 1,880

Electronics 106,500 54,000 52,500 6.9 733,700 3,374

Display 16,900 31% 8.0 266,600 1,226

Electronics Materials 37,000 69% 6.4 467,000 2,148

Chemicals 110,200 46,700 63,500 8.2 906,800 4,170

Essential Chemicals 9,000 19% 5.0 106,200 488

Performance Chemicals 37,700 81% 9.0 800,700 3,682

Life Science 15,800 1,100 14,700 14.0 221,200 1,017

Sub-total 342,000 154,100 187,900 6.3 2,164,600 9,955

Ceramics/Other 5,000 3,200 1,800 6.3 31,600 145