First Read: CKD "Q4 FY3/26 results: negative, no compelling story provided"

研报英文原文证据摘录

First Read: CKD "Q4 FY3/26 results: negative, no compelling story provided"

cated that (1) improving

profitability will be prioritized, and (2) the earnings targets in the medium-term plan are Tsubasa Sasaki

Analyst

conservative, with potential upward revisions depending on earnings trends and

tsubasa.sasaki@ubs.com

external conditions. In response to concerns that the profit margin and sales targets may +813-5208 6207

be overly conservative, management stated that it established conservative targets

based on the company's need for structural improvements. Under its capital policy, the

company intends to continue paying stable dividends based on a dividend payout ratio

target of 40%.

Q: How would we expect investors to react?

A: First, while FA/SPE companies have posted strong earnings results and guidance, the

company's FY3/27 OP plan may have fallen short of market expectations. Second, the

new medium-term management plan has rather low earnings targets, and its capital

policy and management strategy largely maintain the previous approach, which may be

viewed as lacking by the equity market. In particular, the company's 10-year vision

provided no compelling ultra-long-term story.

Valuation:

Given that the share price has exceeded our price target, we are putting our rating and

price target Under Review.

Highlights (¥b) 03/23 03/24 03/25 03/26E 03/27E 03/28E 03/29E 03/30E

Revenues 159.5 134.4 155.6 154.0 175.6 185.2 194.5 204.4

Operating profit 21.2 13.1 19.0 18.2 26.3 30.6 32.8 35.9

Recurring profit 21.2 13.0 19.2 18.5 26.8 31.1 33.3 36.4

Net profit (reported) 14.8 8.3 13.5 13.0 18.2 21.2 22.6 24.8

EPS (reported, basic) (¥) 221.8 124.9 202.5 194.9 272.7 316.6 338.9 370.5

Profitability/valuation 03/23 03/24 03/25 03/26E 03/27E 03/28E 03/29E 03/30E