F3/27 1Q Results: Subdued 1Q Outcomes, Likely Lingering Concerns over Upfront Cost Growth for 2Q

研报英文原文证据摘录

F3/27 1Q Results: Subdued 1Q Outcomes, Likely Lingering Concerns over Upfront Cost Growth for 2Q

Update

July 31, 2026 09:58 AM GMT

Morgan Stanley MUFG Securities Co., Ltd.+MLIXIL (5938) | Japan Ryo Yagi

Equity Analyst

F3/27 1Q Results: Subdued 1Q Ryo.Yagi@morganstanleymufg.com +81 3 6836-8938

Outcomes, Likely Lingering

Concerns over Upfront Cost

LIXIL (5938.T, 5938 JT)

Housing Fixtures | Japan

Growth for 2Q Stock Rating Equal-weight

Industry View In-Line

Price target ¥1,600

AlphaSignals Earnings Reaction Shr price, close (Jul 31, 2026) ¥1,735

Mkt cap, curr, basic (bn) ¥497.6

Unchanged Meaningful shortfall Modest revision lower Avg daily trading value (bn) ¥3.4

Impact to our thesis Financial results versus consensus Direction of next 12-month

consensus EPS

Source: Company data, Morgan Stanley Research

Key Takeaways

1Q core earnings were ¥1.7bn (-81% YoY), and OP missed our and consensus

forecasts.

The difference vs. our forecast was weaker LHT and Living business. LHT saw

subdued sales (both new-build & renovations) and effects of higher costs.

2Q faces upfront cost growth. Effects of price revisions are expected to come

through gradually from 2H and contribute ¥21bn in F3/27.

US business ran a ¥0.8bn OP loss (vs. a ¥2.4bn loss last year). Restructuring is

helping to reduce losses, but these persist amid low-key demand.

Implications for the share price: Negative. 1) Low run-rates in 1Q leave residual

concerns about reaching full-year guidance. 2) Concerns also persist about a weak

earnings undertone as cost growth is set to take precedence in 2Q, despite

prospects of effects of price revisions gradually materializing from 2H.

Exhibit 1: LIXIL (5938.T): Earnings Highlights

JPY mn FY3/26 1Q FY3/27 1Q FY3/27 1Q-4Q

A e Consensus A YoY e YoY Consensus Ce