Nippon Paint Holdings (4612.T): Update: Will China TUC and AOC swing to revenue growth in Q2?

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Nippon Paint Holdings (4612.T): Update: Will China TUC and AOC swing to revenue growth in Q2?

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01 Jul 2026 02:57:16 ET │ 17 pages

Nippon Paint Holdings (4612.T)

Update：Will China TUC and AOC swing to revenue growth in Q2?

CITI'S TAKE

We restart coverage after a period of Limitation. We revise our forecasts.

FY12/26 Q1 earnings were stronger than had been expected, and

management says it believes full-year guidance is achievable and even that Neutral

an overshoot is possible, which is reassuring given lingering concerns about Price (30 Jun 26 15:30) ¥1,053.0

an undershoot owing to the Middle East situation. On a cautionary note, Target price ¥1,190.0↑AOC’s profit margin declined in Q1, and there is risk that price hikes are

accompanied by a decline in demand (or inventory adjustments), although from ¥1,100.0

there is currently no sign of this. Even so, we think Q2 results could be Expected share price return 13.0%

received positively as China TUC sales and AOC’s sales appear likely to rise

Expected dividend yield 1.6%YoY. We raise our TP to ¥1,190 from ¥1,100 to reflect our new forecasts (TP is

still based on a FY12/26 PER of 15x). Our rating remains Neutral. Expected total return 14.6%

Market Cap ¥2,442,390M

Our forecasts — We raise our FY12/26 OP forecast to ¥280bn from ¥258bn.We US$15,116Mfactor in stronger-than-expected results in Q1 (mainly at Nipsea China and Nispea

companies in Turkey and Southeast Asia) and the situation in the Middle East having

a smaller impact on earnings than we previously expected. Price hikes are

progressing smoothly overall, and there are signs of excess orders in some places to

secure inventory. However, the impact of higher costs is likely to emerge in the short Price Performance

term (in Q2).