JX Advanced Metals (5016): Moving to an Overweight rating and a ¥5,700 price target from Not Rated: To an advanced materials maker

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JX Advanced Metals (5016): Moving to an Overweight rating and a ¥5,700 price target from Not Rated: To an advanced materials maker

J P M O R G A N Asia Pacific Equity Research

18 June 2026

JX Advanced Metals (5016) Overweight

5016.T, 5016 JP

Moving to an Overweight rating and a ¥5,700 price Price (18 Jun 26):¥4,370

target from Not Rated: To an advanced materials maker Price Target (Dec-26):¥5,700

Following a period of restriction, we are moving to an Overweight rating and a Japan Equity Research

December 2026 price target of ¥5,700 (Neutral rating and December 2026 price

Technology - Semiconductor/

target of ¥3,700 prior to restriction) from a Not Rated designation. Demand for Technical Materials

advanced semiconductors is accelerating, driven by AI. JX Advanced Metals AC Mio Shikanai

stands to benefit thanks to its strong position in semiconductor target materials and

(81-3) 6736 1313

its technological advantages in high-purity processing technology. In addition, the mio.shikanai@jpmorgan.com

company has announced plans to expand InP substrate capacity, aiming for a 7-10x AC Yasuhiro Nakada

increase by FY2030. We expect InP substrates to turn into the next growth driver (81-3) 6736-8692

(details on page 3). We forecast rapid profit growth over the FY2024-28 period, yasuhiro.nakada@jpmorgan.com

with the company increasing its overall operating profit at a CAGR of 21% and the JPMorgan Securities Japan Co., Ltd.

semiconductor materials segment doing so at a 40% clip. We calculate our price

target of ¥5,700 by applying a P/E of 30x to our FY2027 EPS forecast. We think Key Changes (FYE Mar)

a high valuation is justified given that the semiconductor materials segment’s Prev Cur Δ

earnings weighting is rising and the segment’s margins are improving. Adj.