Asahi Group "Business update conference: break in the clouds" (Buy) Ihara

研报英文原文证据摘录

Asahi Group "Business update conference: break in the clouds" (Buy) Ihara

n key markets, suggesting that

EPS (reported, basic) (¥)

its competitiveness has not deteriorated.

UBS Cons.

12/25E 89.9 99.0

The company said it has a sense of urgency over the current share price 12/26E 122.3 125.4

At the conference, Asahi explained that it has a sense of urgency over the current share 12/27E 144.2 142.8

price. It commented that in order to drive the share price higher, it would need to: (1)

Rei Iharacatch up on the delayed results disclosures, (2) re-explain Asahi's growth strategy to the

Analyst

market, (3) provide a more detailed explanation of its capital policies aimed at achieving rei.ihara@ubs.com

ROE of 11% or higher by 2030, and (4) clearly explain the current situation in the Middle +81-3-5208 6227

East and its countermeasures. It further explained that (1) as for results disclosures, it

Ryunosuke Watanabeaims to catch up so that it can disclose at least FY12/26 results in accordance with the

Associate Analyst

usual schedule; (2) in its growth strategy, Asahi aims to present specific measures on the ryunosuke.watanabe@ubs.com

premium strategy, global brand strategy, non-alcoholic beverage strategy, and lactic acid +81-3-5208 6243

bacteria and yeast business strategy, (3) in the capital policies, it intends to consider

share buybacks, even in small amounts, in FY12/26 if possible, and (4) the impact of the

Middle East situation on costs is estimated at ¥10bn-15bn in FY12/26, as 70-90% of

costs for the year are hedged, and that it aims to counter with a pricing strategy

appropriately if costs continues to rise further in FY12/27 and beyond.

Valuation: We expect a strong advance from here

Even though sluggish Q1 sales were announced, the share price reaction was limited.