Asia Marketing Feedback - IT Service/Cloud SaaS

Research evidence excerpt

Asia Marketing Feedback - IT Service/Cloud SaaS

es later this fiscal year, similar to

the network router shortages experienced during the COVID period. Fujitsu typically updates

its pricing book every three to six months, and we believe most SI companies have already

incorporated current hardware costs into their pricing for at least H1. Regarding Q1 earnings,

consensus is expecting operating profit of approximately ¥36bn–¥38bn, which is in line with

our estimates. There were not many questions on Obic (4684 JP, Hold): we expect it to report

solid fundamental trends again.

BayCurrent (6532 JP, Buy) – Investor interest remains high ahead of the July 15 earnings

release, with discussions focused on earnings and valuation. Although consulting has been

viewed as an AI-negative sector, BayCurrent continues to show strong growth momentum and

has guided for revenue acceleration this fiscal year. We expect Q1 to be seasonally soft; its

share price has rallied 45% over the past three months but earnings growth is expected to

accelerate through the rest of the financial year. We will host CFO calls on July 16 at 10:00am

JST and 6:00pm JST (with a translation).

IIJ (3774 JP, Hold) – Backed by a strong order backlog from the previous fiscal year, IIJ should

start FY3/27 comfortably. Network segment margins could fluctuate due to the mix of large-

scale projects, which typically include lower-margin hardware sales. Meanwhile, management

expects another strong year for the SI business. We also discussed the activist shareholder,

which now owns about 9% of the company, behind NTT and KDDI (11.1% each).

Trend Micro (4704 JP, Buy) – Expecting a Soft Quarter: Management has already indicated

that it will invest aggressively in Q2, which is expected to depress operating margin to 17–19%.