Raise PO; strength in industrial gases offsetting weakness in LPG sales

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Raise PO; strength in industrial gases offsetting weakness in LPG sales

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Iwatani Corporation (8088)

Raise PO; strength in industrial gases

offsetting weakness in LPG sales

Reiterate Rating: UNDERPERFORM | PO: 1,800 JPY | Price: 2,020 JPY

15 July 2026

Raise PO to ¥1,800 from ¥1,750; reiterate Underperform Equity

We lift our price objective (PO) to ¥1,800. While profitability in LPG sales is likely to

deteriorate owing to higher logistics and other costs, and equity earnings from Cosmo

Energy could weaken resulting from lower refining margins, we see improving prospects Key Changes

for industrial gases, including air separation gases, helium and hydrogen, driven by (¥) Previous Current

stronger demand from electronics-related applications. We now apply 9x P/E to our Price Obj. 1,750.00 1,800.00

FY3/28 EPS estimate, excluding LPG market factors (vs. 7.5x previously). We reiterate 2027E EPS 239.86 241.55

our Underperform rating, as higher costs in the LPG business and slower growth in the 2028E EPS 209.87 187.68

hydrogen business are likely to result in weaker earnings growth. 2029E EPS 244.64 237.21

2027E DPS 48.00 47.00

Lift OP forecasts: Industrial gases to offset dull LPG sales

We raise our operating profit (OP) forecasts, excluding LPG market factors, from Takashi Enomoto >>

¥46.6bn to ¥47.6bn for FY3/27 and from ¥47.7bn to ¥48.0bn for FY3/28. We forecast 1Q Research Analyst

BofAS Japan

OP of ¥7.9bn on the same basis. We expect the company’s guidance to remain takashi.enomoto@bofa.com

unchanged and do not anticipate any material surprise. Helium prices surged between Yuri Tanaka >>

March and June owing to geopolitical tensions in the Middle East, but prices in China Research Analyst