TYNPF - Nippon Sanso: Things Will Moderate

2024-03-24 09:04:45 ET

Summary

• Nippon Sanso's quarter was unexciting, with the trends from last quarter proceeding in similar tenor.
• The company's core operating income growth has decelerated, with lower growth rate expectations for the next full year as electricity costs level at lower levels.
• Volume evolutions have been negative, except for Europe, and FX effects have favored results in Yen terms, which could also be a somewhat fleeting effect.
• Price management is in place including longer-term contracts, so major volatility should not be expected, and Europe continues to look strong as well as the US.
• The discount with western peers has meaningfully closed, and accounting for Yen convergence, fair value is already much closer.

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