Inbound demand potentially more resilient than previously expected; maintain stock recommendations based on idiosyncratic factors; Buy on Kotobuki/Kyoritsu

Research evidence excerpt

Inbound demand potentially more resilient than previously expected; maintain stock recommendations based on idiosyncratic factors; Buy on Kotobuki/Kyoritsu

Equity Research

23 June 2026 | 8:02PM JST

JAPAN: TRAVEL/LEISURE

Inbound demand potentially more resilient than previously expected;

maintain stock recommendations based on idiosyncratic factors; Buy on

Kotobuki/Kyoritsu

We review recent inbound demand and FY3/26 earnings data, and update our views Norihiro Miyazaki

+81(3)4587-9842 |

on Kotobuki Spirits, Kyoritsu Maintenance, and Japan Airport Terminal. The main norihiro.miyazaki@gs.com

Goldman Sachs Japan Co., Ltd.

points are as follows:

Ryohei Kurita

+81(3)4587-1799 |

n Inbound demand trends and outlook: The number of inbound visitors to Japan ryohei.kurita@gs.com

in April/May 2026 was down -6%/-4% yoy (+22%/+13% excluding mainland

China/Hong Kong), with weakness in inbound visitors from mainland China/Hong

Kong dragging down the overall yoy growth rate. From our discussions with

investors, our impression is that there are concerns over the impact of higher

airfares due to fuel costs going into July-September 2026. At present, we see no

clear signs of a slowdown in inbound tourism demand from related companies,

and aviation fuel spot prices have fallen substantially from their recent peaks, so

we believe demand is likely to be more resilient compared with our last update.

Taking these factors into account, we raise our forecast for CY26 inbound visitor

numbers to +0% from -2% yoy. In addition, we believe outbound travel demand

from Japan may shift to domestic travel in the short term on the back of recent

rises in airfares, and such demand trends are also likely to provide a certain

degree of support. While we expect lower visitor numbers from mainland China