Nikon (7731): Reiterate Neutral: Focused investment strategy in place; next is monetization

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Nikon (7731): Reiterate Neutral: Focused investment strategy in place; next is monetization

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Nikon (7731)

Reiterate Neutral: Focused investment

strategy in place; next is monetization

Reiterate Rating: NEUTRAL | PO: 2,260 JPY | Price: 2,144 JPY

09 July 2026

Raise PO to ¥2,260 from ¥2,160; reiterate Neutral Equity

Following indications of robust demand for advanced packaging lithography systems

from peer company briefings, we raise our forecast for Nikon’s digital lithography unit

shipments. As a result, we lift our operating profit estimates by 3% for FY3/28 and 2% Key Changes

for FY3/29, while maintaining our FY3/28 P/E multiple at 29x. We reiterate our Neutral (¥) Previous Current

rating. Key investment positives are: (1) market-share gains in ArF lithography systems; Price Obj. 2,160.00 2,260.00

and (2) revenue growth in the Imaging segment, driven by strong sales of flagship 2028E Rev (m) 810,844.9 813,844.9

consumer camera models. On the other hand, uncertainty regarding profitability 2029E Rev (m) 870,604.3 873,604.3

improvement in the Digital Manufacturing (DM) business remains a key concern. 2028E EPS 74.41 77.80

2029E EPS 123.52 125.55

1Q results: Limited potential for surprise 2028E EBITDA (m) 72,137.5 73,067.5

We forecast a company-wide operating loss of ¥3.1bn in 1Q FY3/27 (vs. Visible Alpha 2029E EBITDA (m) 93,519.4 94,449.4

consensus of a ¥4.9bn loss). For lithography tools, accelerating EUV investment by

foundries is increasingly constraining competitor ArF supply capacity, creating Mayako Ouchi >>

conditions that could support Nikon’s market-share expansion. In the consumer camera Research Analyst

BofAS Japan

business, rising DRAM and NAND prices are likely to increase costs in the near term. +81 3 6225 6434