Tokyo Steel Mfg: 27/3 Q1 results: ASP higher than we had expected

研报英文原文证据摘录

Tokyo Steel Mfg: 27/3 Q1 results: ASP higher than we had expected

Global Markets Research

18 July 2026Tokyo Steel Mfg

5423.T 5423 JP / EQUITY: JAPAN STEEL, NONFERROUS METALS, WIRE & CABLE

Rating27/3 Q1 results: ASP higher than we had expected Remains Neutral

Target price

Spreads hit major bottom in Q1, but lackluster demand conditions will probably Increased from 1,700 JPY 1,750

necessitate further price hikes and increased sales of low CO2 steel

Closing price JPY 1,748We remain Neutral, fine-tune our forecasts to factor in recent price hikes 17 July 2026

The company announced 27/3 Q1 results at 14:00 JST on 17 July, followed by a briefing at

Implied upside +0.1%15:15. We fine-tune our forecasts and retain our Neutral rating. We continue to apply a

premium of around 25% to the Russell/Nomura Large Cap materials sector average in view

of medium-term growth and net cash, and obtain our target price of ¥1,750 by multiplying our

28/3 EPS forecast by a P/E of 21.3x. While Q1 operating profits beat our forecast and the

Relative performance chartQUICK consensus forecast, underlying demand is lackluster, as evidenced by consistently

weak construction start floor area for steel structures (Figure5), and we think any further

rise in the share price will require: (1) increased sales of hobozero ("Near Zero") steel

products that reflect the value-added of low CO2 emissions; and (2) further price hikes in

Japan.

27/3 Q1 results: Selling prices and volumes higher than we had expected, but

structural steel saw rush demand ahead of price hikes

Q1 operating losses of ¥2.3bn were better than our forecast of losses of ¥4.4bn and the 17

July QUICK consensus forecast of losses of ¥3.5bn. Compared to our forecasts, it was

mainly selling prices that were higher than we expected.