West Japan Railway: Feedback from President's Sell-side Small Meeting: Organic Growth excl. M&A May Be Lower than Appears at a Glance from the New MTP OP Target

Research evidence excerpt

West Japan Railway: Feedback from President's Sell-side Small Meeting: Organic Growth excl. M&A May Be Lower than Appears at a Glance from the New MTP OP Target

Update

May 21, 2026 11:48 AM GMT

Morgan Stanley MUFG Securities Co., Ltd.+MWest Japan Railway (9021) | Japan Takuya Osaka

Equity Analyst

Feedback from President's Sell- Takuya.Osaka@morganstanleymufg.com +81 3 6836-5438

side Small Meeting: Organic

Growth excl. M&A May Be

West Japan Railway (9021.T, 9021 JT)

Railways | Japan

Lower than Appears at a Glance Stock Rating Equal-weight

Industry View In-Line

Price target ¥3,100from the New MTP OP Target Shr price, close (May 21, 2026) ¥2,722

Mkt cap, curr, basic (bn) ¥1,235.3

Avg daily trading value (bn) ¥5.8

Having attended JR West's small meeting with the president on May 21, our views

from the discussion (on the new mid-term plan) are as follows. 1) M&A: OP and

strategic investment in the new MTP appear to factor in M&A effects (the firm did

not disclose any quantitative information). We have the impression that it is eyeing

real estate (incl. hotels), infrastructure solutions and financial services among

possible areas for M&A. 2) Strategic investment in the new MTP also appears to

include capex (overall project outlines and investment sums unclear) relating to the

Osaka Integrated Resort (due to open in F3/31) and Naniwasuji Line (F3/32). 3) Our

impression is that organic growth stripped of M&A may be lower than implied at a

glance by the OP target. It seems likely that full recouping of investment in the new

MTP will fall under the following plan (from F3/32). 4) We found fresh confirmation

of our view that, assuming inflation persists, fare revisions will be needed to secure

safety and continuity in rail operations. The firm mentioned the possibility of such