NTT: Risk Reward Update

Research evidence excerpt

NTT: Risk Reward Update

UpdateM

RiskRisk RewardReward– NTT (9432.T)- NTT (9432.T)

Mobile strategy unclear, competitiveness declining, earnings weak

PRICE TARGET ¥150 EQUAL-WEIGHT THESIS

EV/EBITDA (2 year fwd) 6x ▪Fixed line communications face the

Valuation: using the benchmark 2yr fwd EV/EBITDA multiple for the industry. With low 1- structural issue of shrinking demand. Group

digit% EBITDA growth, a shareholder returns yield around 4% and high leverage, we think profit is bottoming out, with a data center

NTT lacks investment appeal. and the enterprise business driving growth.

Shareholder returns are either level with or ¥182

below peers, and there are few catalysts to

Consensus Price Target Distribution ¥150 ¥210.00 drive recovery in shares. Valuation: With low

MS PT

1-digit% EBITDA growth, a shareholderSource: Refinitiv, Morgan Stanley Research Mean Morgan Stanley Estimates

returns yield around 4% and high leverage,

we think NTT lacks investment appeal.

RISK REWARD CHART

Consensus Rating Distribution

JPY 62% Overweight

38% Equal-weight

¥200¥200(+31.23%)¥200(+31.23%)(+31.23%)

0% Underweight

200 MS Rating

Source: Refinitiv, Morgan Stanley Research

150 ¥152¥152¥152 ¥150¥150(-1.57%)¥150(-1.57%)(-1.57%)

Risk Reward Themes

100 ¥120¥120(-21.26%)¥120(-21.26%)(-21.26%) Self-help: Positive

View descriptions of Risk Rewards Themes here

MAY '25 NOV '25 MAY '26 MAY '27

Key: Historical Stock Performance Current Stock Price Price Target

BULL CASE ¥200 BASE CASE ¥150 BEAR CASE ¥120

EV/EBITDA (2-year fwd) 7x EV/EBITDA (2-year fwd) 6x EV/EBITDA (2-year fwd) 4x

Greater-than expected synergies boost Valuation: Using the benchmark 2yr fwd An unlikely scenario, but further regulatory

profit growth, outlook for EPS widely EV/EBITDA multiple for the industry.