Nisshin Oillio Group "FY3/26 results: price hikes not gone through" (Buy) Ihara

研报英文原文证据摘录

Nisshin Oillio Group "FY3/26 results: price hikes not gone through" (Buy) Ihara

ass

UBS Cons.

through has been slower than expected so far, some uncertainty remains. We intend to 03/26E 262.6 262.6

revisit our earnings forecasts following the results meeting. 03/27E 134.6 134.6

03/28E 149.9 149.9

Q: What were the key takeaways from the results?

Rei IharaA: The market is paying close attention to the outlook for the company’s confectionery

Analyst

fats business. The FY3/27 budget calls for sales volume of confectionary fats to increase rei.ihara@ubs.com

9% yoy, while selling prices are assumed to be broadly flat yoy. Demand for CBE remains +81-3-5208 6227

solid, and considering the possibility of a recovery in chocolate demand as cocoa raw

Ryunosuke Watanabematerial prices decline, management indicated that it expects sales of confectionery fats

Associate Analyst

to remain resilient. Even if cocoa butter prices fall, the company does not anticipate a ryunosuke.watanabe@ubs.com

sharp fall in selling prices and appears to believe selling prices for confectionery fats can +81-3-5208 6243

be maintained. In FY3/27, the company intends to accommodate demand growth using

existing production capacity, but indicated that new manufacturing facilities are set to

contribute from FY3/28 onward, enabling the company to step up its growth trajectory.

Valuation: Share price fell slightly after results released during trading hours

The results were announced during trading hours and given that guidance came in

slightly below expectations, the share price edged down, closing down 1.7% on the day.

Our price target of ¥2,160 is based on a FY3/28E PBR of 0.93X. We forecast ROE of

6.5% for FY3/28. Our theoretical PBR is derived from a PBR-ROE method, referencing