Japan Research Pack

In 17/3, profits attributable to owners of the parent were ￥352.2bn, short of our￥375.0bn forecast, primarily because of ￥49.5bn in net one-time losses in Q4. Thecompany forecasts 18/3 profits attributable to owners of the parent of ￥400bn, in linewith our previous forecast (unchanged). We view the results as favorable as they pointto sustained profit growth. We also take a favorable view of enhancements toshareholder return policies in the form of share buybacks and dividend increases. Weraise our target P/B to 1.3-1.4x, from 1.3x previously, in view of improved cashgenerating capacity and shareholder return policies. Our target price of ￥2,070 is basedon end-17/3 BPS of ￥1,533 and the target P/B.