Daito Trust Construction: 27/3 Q1 results: Earnings favorable, underpinned by strong apartment rents

研报英文原文证据摘录

Daito Trust Construction: 27/3 Q1 results: Earnings favorable, underpinned by strong apartment rents

Global Markets Research

31 July 2026Daito Trust Construction

1878.T 1878 JP / EQUITY: JAPAN HOUSING & REAL ESTATE

Rating27/3 Q1 results: Earnings favorable, underpinned

Remains Neutralby strong apartment rents

Target price

Increased from 3,570 JPY 3,610Looking to diversify from apartments into other asset classes

Closing price

We fine-tune our forecasts, retain our Neutral rating 30 July 2026 JPY 3,505

Daito Trust Construction released 27/3 Q1 results at 11:30 JST on 31 July, with operating

profits of ¥39.4bn, up 16% y-y and beating our forecast of a 7% y-y increase by ¥2.9bn. Implied upside +3.0%

The real estate leasing segment contributed ¥3.5bn to this ¥2.9bn overshoot, while other

segments performed broadly as we expected. We attribute the better-than-expected

profits at the real estate leasing segment to solid rental demand, reflecting soaring

Relative performance chartconstruction and housing prices. Against this backdrop, occupancy was high at 98% and

rental income increased. However, we only fine-tune our full-year 27/3 earnings forecasts

because in a typical year the company books sales promotion costs in Q4 in order to

attract tenants. We also slightly alter our target price, retaining our Neutral rating.

Weak demand for new-build and investment apartments because of rising interest

rates

Apr–Jun orders in the construction segment, which is mainly involved in apartment

construction, fell 21% y-y to ¥102.6bn. The company has been shifting its sales focus from

regional and suburban areas, where the population is plunging and demand for rental

apartments is unlikely to increase, to urban areas. In these areas, it has also been focused