MinebeaMitsumi: Raising price target on stronger AI tailwinds

研报英文原文证据摘录

MinebeaMitsumi: Raising price target on stronger AI tailwinds

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outlook on strong demand for small-diameter bearings used in fan motors for AI servers.

From To % ch Cons.

We believe weaknesses in smartphones and gaming are being offset by the core 03/27E 235.9 239.8 2 217.7

bearing, semiconductor and motor businesses, making the overall earnings structure 03/28E 259.0 274.2 6 249.8

more resilient. We estimate Q1 (April-June) OP at ¥25.6bn, slightly below consensus, 03/29E 286.3 314.8 10 278.3

but likely above the company's internal target.

Shingo Hirata, CFA

Points to watch at results briefing Analyst

shingo.hirata@ubs.com

MinebeaMitsumi plans to announce results and hold a briefing on 5 August. Points to +81-3-5208 6224

watch are: 1) management’s outlook for demand for AI data centre-related products, 2)

its outlook for the AS segment and unique factors that support earnings and 3) pricing

strategies for motors and other products. Regarding point 1), judging by management’s

comments at sell-side analyst meetings and a Nikkei news report (link) in early July

stating that the company is targeting bearing production capacity of 500mn units per

month by 2030, management appears more confident in the outlook.

Valuation: Maintaining Buy rating, raising price target from ¥4,450 to ¥5,750

Our price target is based on SOTP, using FY3/28E PERs of 25X for the PT segment, 20X

for the MLS and SE segments, and 8X for the AS segment (previous multiples: 20X, 20X,

15X and 8X). We increased the multiple for the PT segment to reflect accelerating

growth in products for AI data centres and raised the multiple for the SE segment due to

higher valuations across the semiconductor sector.

Highlights (¥b) 03/24 03/25 03/26 03/27E 03/28E 03/29E 03/30E 03/31E