JAPAN FIRST TO MARKET

Research evidence excerpt

JAPAN FIRST TO MARKET

Asia Pacific Equity Research

Japan First to Market 23 June 2026

Top Stories

Games, Internet, Services (Junko Yamamura)

Summary of 4Q FY2025 results and subsequent key points

In the home video game and internet sectors, share prices have been weak and disconnected from fundamentals, but from a

bottom-up perspective, our investment recommendations for 2H FY2026 in the home video game sector are Konami and

Capcom, followed by Bandai Namco Holdings, then Nintendo, in that order. Looking ahead to 1Q FY2026 results, we

recommend Konami, which has begun to show growth in sales of eFootball after the start of the World Cup tournament, and

Capcom, which we expect to deliver strong operating profit growth. After 1Q results, we mainly recommend Bandai Namco

Holdings and Nintendo. In the internet sector, our investment recommendations are Recruit Holdings, Mercari, then

CyberAgent, in that order. Key themes for the home video game sector are 1) the global expansion of Japanese content and IP,

and 2) the use of AI to improve development efficiency. The internet sector has a lower barrier to AI adoption than the home

video game sector, which is more influenced by user emotions. Key themes for the internet sector are 1) the use of AI to

expand sales and improve profitability, and 2) fintech reorganization.

Paper & Packaging Sector (Japan) (Akiko Kuwahara)

DATA & NEWS (Apr-May): Inventories of main products turned upward MoM in May

In May, domestic demand momentum deteriorated compared with April for both containerboard and printing & information

paper. Although a difference in the number of holidays might have had an impact YoY, the fact that inventories turned upward

MoM is a somewhat concerning data point.