Japan retail sector: Mar-May results review and investment perspectives

Research evidence excerpt

Japan retail sector: Mar-May results review and investment perspectives

Global Markets Research

15 July 2026Japan retail sector

EQUITY: JAPAN RETAILING

Mar–May results review and investment Research Analysts

perspectives Japan retailing Hisahiro Yamaoka - NSC

Our core picks are companies with their own unique growth factors, but hisahiro.yamaoka@nomura.com

also focusing on companies that sell high-margin daily necessities +81 3 6703 1680

Shintaro Umeda - NSC

Mar–May: Strong performance, particularly at specialty retailers, but gross margins at shintaro.umeda@nomura.com

some companies remain a concern +81 3 6703 1741

Looking back at Mar–May results for retailers under our coverage, the strong performance by

specialty retailers stood out in particular. Fast Retailing's [9983] (Neutral) Uniqlo International

segment continued to perform well. Ryohin Keikaku [7453] (Buy) posted strong results, with sales

growth both in Japan and overseas translating into profit growth. We were impressed by the

company's agile management of SG&A costs. Department store earnings were also solid, with

ongoing cost cuts and a stronger customer base translating into sales growth at Takashimaya

[8233] (Neutral). Earnings at Seven & i Holdings [3382] (Neutral) benefited substantially from

gross profits on gasoline, but there were no surprises. Gross margins do, however, remain a

concern for some companies. Aeon's [8267] (Neutral) food retail margins remained an issue, and,

at Sugi Holdings [7649] (Neutral), enhanced sales promotions led to a lackluster gross profit

margin.

Investment perspective (1): Core picks are companies with unique growth drivers such as

global expansion

For the retail sector, we are first off focusing on companies with distinctive growth drivers that are