Kao (4452) Small meeting with president: Measures to accelerate innovation

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Kao (4452) Small meeting with president: Measures to accelerate innovation

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

25 June 2026

Kao (4452) Overweight

4452.T, 4452 JP

Small meeting with president: Measures to accelerate Price (25 Jun 26):¥6,241

innovation Price Target (Dec-26):¥7,800

On June 25, Kao held a small meeting with Representative Director, President and Japan Equity Research

Chief Executive Officer Yoshihiro Hasebe, who talked about cases of the company

Cosmetics and Personal Care /

innovating based on ESG and AI. He also expressed confidence in attaining the Paper and Packaging

targets in Kao’s K27 medium-term plan (MTP). We were left with a positive AC Akiko Kuwahara

impression owing to confirmation of factors like (1) strengthening of the cosmetics

(81-3) 6736-8617

segment’s power to drive earnings and (2) progress on value-adding efforts at the akiko.kuwahara@jpmorgan.com

chemicals segment. JPMorgan Securities Japan Co., Ltd.

• Summary of management team’s comments on main discussion points: (1)

Accelerating innovation based on ESG and AI: Kao’s core technology is

related to surfactants. Efforts are underway at the company’s oleochemical

business to create solutions for future palm kernel oil shortages and to end

petrochemical use via Kao’s proprietary surfactant, Bio IOS. Kao is

minimizing the impact from petrochemical supply constraints caused by the

worsening of the situation in the Middle East via these efforts and its global

network. The rapid evolution of AI is also expanding the market for surfactant

technology. Kao sees business opportunities in semiconductor production-

related cleaning agents and selective extraction of rare earths. (2) Current status

and outlook for value-adding at chemicals segment: The segment’s growth