Hirose Electric: Takeaways from F3/27 1Q Results Briefing

Research evidence excerpt

M

Update

August 5, 2026 05:00 AM GMT

Morgan Stanley MUFG Securities Co., Ltd.+

Hirose Electric (6806) | Japan

Sota Harashima

Equity Analyst

Takeaways from F3/27 1Q

Results Briefing

Shoji Sato

Equity Analyst

(1) 1Q sales were ¥62.1bn (+27% YoY). By category, General industrial (+46%) was

strong globally, mainly in FA and robots; Smartphone (+4%) was weak in China but

solid elsewhere; and Consumer/Mobile Equipment (+10%) saw expanding demand

Hirose Electric (6806.T, 6806 JT)

related to edge AI.

Electronic Components | Japan

(2) The 1Q book-to-bill ratio was 1.14x (1.06x a year earlier, 1.16x in the previous

Stock Rating

Industry View

Price target

Shr price, close (Aug 4, 2026)

Mkt cap, curr, basic (bn)

Avg daily trading value (bn)

quarter). By application, general industrial was 1.2x, smartphone was slightly below

1.1x, and automotive/mobility and telecommunications infrastructure were each

around 1.1x. In 2Q, shipment volumes of smartphone and consumer applications are

expected to increase QoQ in line with seasonality, and the YoY impact from price

Overweight

In-Line

¥36,600

¥27,415

¥927.6

¥3.4

cuts on smartphone connectors should ease considerably.

(3) 1Q OP was ¥13.3bn. The main factors behind the ¥3.5bn YoY increase were

higher volume (+¥5.5bn), forex (+¥1.8bn), labor costs (-¥1.4bn), material &

procurement costs (-¥2.5bn), and price optimization (+¥0.7bn). Of the expected YoY

impact on full-year OP, there is no change to the outlooks for material &

procurement costs (-¥8.0bn) or price optimization (+¥3.0bn).

(4) We think the upwardly revised F3/27 OP forecast (1H ¥25.5bn, full-year

¥50.0bn) represents a level the company should achieve. In our view, there is ample

upside potential if it makes progress in expanding production capacity to meet

strong demand. If recent market conditions continue, the impact from higher raw

material costs could also ease heading into 2H.

Exhibit 1:

Sales by application

(Y bn)

Sales by applications

General Industrial

Smartphone

Consumer/Mobile equipment

Automotive/Mobility related

Telecommunications infrastructure equipment

OA equipment and Others

YoY

General Industrial

Smartphone

Consumer/Mobile equipment

…