Japan toiletries & cosmetics: Points to watch in Apr-Jun results

Research evidence excerpt

Japan toiletries & cosmetics: Points to watch in Apr-Jun results

Global Markets Research

27 July 2026Japan toiletries & cosmetics

EQUITY: JAPAN TOILETRIES & COSMETICS

Research Analysts

Points to watch in Apr–Jun results Japan toiletries & cosmetics

Yuji Ohana - NSC

Focus on price hiking ability and cost performance in near term, topline yuji.ohana@nomura.com

growth in Japan and overseas over medium term +81-3-6703-1143

We look to solid earnings in both subsectors

We think companies in both the toiletries and cosmetics subsectors will report solid

earnings for Apr–Jun 2026. We think earnings at toiletries companies benefited from firm

sales and moves to rein in costs via curbs on sales promotions, as well as Apr–Jun being

before the rise in input prices caused by the Middle East conflict really started to be felt.

We think earnings were solid at cosmetics companies because of cost savings delivered

by restructuring and statistics showing strong tax-free sales on the major Japanese and

Chinese markets, bucking concerns about a decline in the number of Chinese visitors to

Japan. At present, we see concerns about how renewed tensions in the Middle East will

affect earnings and whether inflation will change consumer behavior. Accordingly, our

near-term focus is on companies that have the ability to raise prices and are primarily

involved in low- to mid-priced products with good cost performance, while over the

medium term we look to companies that can generate profits in Japan and overseas

having shifted from cost reduction through restructuring to top-line growth, and we

recommend Kao [4452] (Buy) and Rohto Pharmaceutical [4527] (Buy).

Toiletries (1): Potential for major benefits from price hikes in 2027 despite renewed

rises in crude oil prices