27/3 Q1 results: Profits down sharply on soaring input costs

研报英文原文证据摘录

27/3 Q1 results: Profits down sharply on soaring input costs

Global Markets Research

31 July 2026Lixil

5938.T 5938 JP / EQUITY: JAPAN HOUSING & REAL ESTATE

Rating27/3 Q1 results: Profits down sharply on soaring

Remains Neutralinput costs

Target price JPY 1,810 RemainsCompany announces product price hikes, but aluminum prices falling

Closing price JPY 1,735.0We revise quarterly forecasts but retain full-year outlook, maintain Neutral rating 31 July 2026

Lixil announced 27/3 Q1 results on 31 July, reporting business profits of ¥1.7bn (down

Implied upside +4.3%81% y-y), some ¥4.8bn lower than our forecast of ¥6.5bn (down 28%). Profits fell sharply,

as although the company is aiming to raise prices to maintain margins in the face of rising

prices for the key inputs of copper and aluminum since the start of the year, the price

hikes are for orders on or after 3 August for plumbing fixtures and tiles and for orders on or

Relative performance chartafter 1 October for building materials such as residential windows and doors, causing time

lag effects. In particular, profits at the housing technology (LHT) segment, which includes

residential windows and doors, undershot our forecast by ¥5.6bn owing to soaring prices

for aluminum.

We now think the US housing market will prove slower to recover than we had initially

thought owing to persistently high interest rates, but aluminum prices have been falling

from their May peak, which we view as a positive. Lixil has also been stepping up cost

savings in Japan, including deciding to close its Nabari plant, which manufactures

entrance doors and interior building materials in a bid to boost profitability. We revise our

forecasts as we now expect earnings to recover in Q3, a little later than we had previously