27/3 Q1 results: Solid performance, especially in SPE and industrial machinery applications: Quick Note

Research evidence excerpt

27/3 Q1 results: Solid performance, especially in SPE and industrial machinery applications: Quick Note

Global Markets Research

28 July 2026Daido Steel

5471.T 5471 JP / EQUITY: JAPAN STEEL, NONFERROUS METALS, WIRE & CABLE

27/3 Q1 results: Solid performance, especially in Rating NeutralSPE and industrial machinery applications

Target price JPY 1,150Quick Note

Closing price

28 July 2026 JPY 2,316.5First impression in line: Strong demand from SPE industry, recovery in orders for

open die forgings for drilling applications too (Note: Quick Note reports are not a

Daido Steel announced 27/3 Q1 results at 16:00 JST on 28 July, followed by a briefing at vehicle for changes to ratings, target

17:00. Q1 operating profits totaled ¥13.1bn, while adjusted operating profits excluding prices, or earnings forecasts)

one-time items totaled ¥11.5bn (up 25% y-y), slightly ahead of the 28 July QUICK

consensus operating profit forecast of ¥10.9bn. Profit growth was driven y-y by: (1) higher

volumes of stainless steel and structural steel for industrial machinery; and (2) higher

volumes of high value-added open die forgings and stainless steel for SPE applications.

Research AnalystsThis came as no surprise as the Japan Iron & Steel Federation's specialty steel order

statistics had shown a sustained recovery in orders since January 2026, particularly from Japan steel, nonferrous metals,

the industrial machinery sector (see our 23 June 2026 report Japanesecrudesteeloutput wire & cable

(May2026),orderstatistics(April)). Kaori Iwasaki - NSC

kaori.iwasaki@nomura.com

That said, Daido Steel's main production facilities are located in the operating area of +81 3 6703 1198

Chubu Electric Power, which is exposed to high crude oil prices. Guidance assumes a Yuji Matsumoto - NSC