The Must Read PSA Weekly Research Round-up (week to 04 September)
Reports / Flash Notes Summaries
1 Recruit Holdings (6098 JT) – Raising Our Forecasts Following FY26 Q1 Outperformance
Analyst Thao Nguyen updates her forecasts following Recruit’s upward revision to its full-year FY26 guidance. Strong top-line growth is expected to continue, driven by solid demand in the HR Technology, while margins are set to substantially expand [FY25 OPM 17% / FY28 PSAe OPM 28%] on the back of operating leverage and a better revenue mix.
2 Fixstars (3687 JT) – Beneficiary of Qualcomm Japan Robotics Move
A constituent of the PSA 2026 Q3 Focus List, small-cap software solutions firm [market cap US$450mil] Fixstars disappointed the market with a weaker FY26 Q3 than hoped for. However, in this update, analyst Pelham Smithers notes that the underlying growth remains impressive. Its involvement in the Qualcomm robotics centre project should help address a key issue we have with the firm, which is awareness in the business community.
Industry Insights
Japan video games slow
Positive vibes from Semicon Taiwan
Macro / Market / Misc.
July industrial production +4.1% YoY
MoF Enterprise Survey
Might the BoJ raise rates by +0.5ppts or even +0.75ppts?
Company News / Insights
Might Square Enix be taken private?
Kioxia presents its CXL module to Japanese press
Hitachi expands HMAX offering
Rasa Industries: meeting Feedback
Steel scrap prices fall, improving margins for Tokyo Steel
Sumitomo Chemical begins sales of epitaxial wafers for optical communications
Honda planning ¥1.5tril in cost cuts – Reuters
Honda, Nissan Motor cooperate on software
MMC relaunches Pajero
MHI ties up with NEC on defence
Dentsu rises for third consecutive day
DeNA launches a new startup studio
Money Forward launches LLM token cost tracking tool
Kyowa Kirin drug not selected at AAO meet
Company Previews / Results
Tri Chemical: FY26 Q2 OP + 21% YoY
Visional: FY26 full year and Q4 preview
Timee’s FY27 Q1 preview
The Weekly Comment by Pelham Smithers
The household spending survey for July, in real terms, had spending down -3.6% YoY.
Is that a true reflection of Japanese consumption? And if it isn’t, could such a statistic lead to poor policy? Pelham Smithers discusses.
Company / Sector / Thematic Comments at a Glance
Technology: Consumer Electronics, Gaming
1. Japan Video Game Sales Slow
2. Might Square Enix Be Taken Private?
Technology: Industrial Electronics / Components / Semis & SPE / Precision
3. Positive Vibes from Semicon Taiwan
4. Hitachi Expands HMAX Offering
5. Kioxia Presents its CXL Module to Japanese Press
Chemicals / Materials
6. Steel Scrap Prices Fall, Improving Margins for Tokyo Steel
7. Tri Chemical: FY26 Q2 OP +21% YoY
8. Sumitomo Chemical Begins Sales of Epitaxial Wafers for Optical Comms
9. Rasa Industries: Meeting Feedback
Autos / New Mobility
10. Honda and Nissan to Cooperate on Software
11. Honda Planning ¥1.5tril in Cost Cuts – Reuters
12. Mitsubishi Motors Relaunches Pajero
Capital Goods / Machinery
13. MHI Ties Up with NEC on Defence
Internet / eCommerce
14. Dentsu Rises for Third Consecutive Day
15. DeNA Launches a New Startup Studio
16. Timee’s FY27 Q1 Preview
Enterprise Software / IT Services
17. Visional: FY26 Full Year and Q4 Preview
Pharma / HealthCare
18. Kyowa Kirin Drug Not Selected at AAO Meet
Miscellaneous / Market / Strategy / Macro
19. Industrial Production +4.1% YoY in July
20. MoF Enterprise Survey Underscores Rise in Profitability of Japan Firms
21. Might the BoJ Raise Rates by +0.5ppts or Even by +0.75ppts?
PSA in the Press
Japan Electricity Stocks Up as Oil’s Gain Fuels Price Hike Hopes – Bloomberg [1 Sep]
Excerpt: This week’s rise in WTI prices against the backdrop of flaring Middle East tensions has boosted expectations of price hikes, said UK-based Japan equity analyst Pelham Smithers. More investors are looking beyond AI-related stocks for other opportunities in Japan, which is a tailwind for utilities, he added.
Toyota and Honda May Get Stuck with the Bill for Trump’s Canada Tariffs – Reuters [31 Aug]
Excerpt: “If you really wanted to destroy the Canadian auto industry, you could with these tariffs,” said Julie Boote, autos analyst at Pelham Smithers Associates in London. Both companies would likely have to close some of their Canadian assembly lines, she said.
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