European Banks Daily

Research evidence excerpt

European Banks Daily

; (3) tougher

acquiring (~1/3 of fees) and competition in payroll (~30% of loans); and (4) potential

agribusiness asset quality risks (~21% of loans) tied to El Niño, seasoning of refinanced loans,

among others.

APAC

Daiwa Securities Group (8601):Monitoring post-acquisition synergies with ORIX Bank,

maintain Neutral rating

Koki Sato (81-3) 6736-8609

We revise our price target through December 2026 from ¥1,520 to ¥1,720 and maintain our

Neutral rating. We change our valuation base year from FY2026 to FY2027 and lower our target

P/E from 12x to 11x. We use the same target P/E that we use for Nomura Holdings (8604). We

expect the ORIX Bank acquisition to contribute positively to profit levels, but with share

buybacks unlikely in the near term and the higher profit level making the minimum dividend less

compelling, we no longer believe a clear premium over Nomura Holdings is warranted.

Nomura Holdings (8604):Still see upside in strong core business, maintain Overweight

We raise our price target through December 2026 from ¥1,440 to ¥1,680 and maintain our

Overweight rating. We change our valuation base year from FY2026 to FY2027 but keep our

target P/E at 11x. Fundamentals are also strong at Daiwa Securities Group (8601), but while there

is little difference in total return ratios and ROE levels between the two companies, a valuation

gap remains in P/E and P/B terms, and we see significant scope for Nomura Holdings to catch

up.

PayPay:Moving to an Overweight rating and a $21 price target from Not Rated

Junko Yamamura (81-3) 6736-8644

Following a period of restriction, we are moving to an Overweight rating and a December 2026

price target of $21, from a Not Rated designation (Overweight rating and December 2026 price

target of $25 prior to restriction).