(6230) SANEI - New Analyst Report 7/5

◆ Company Overview
・SANEI is a manufacturer specializing in plumbing products such as water taps, plumbing and drainage fittings, fittings, piping components, etc., and most of its sales are for housing.

◆ Financial results for the fiscal year ending March 24
・The financial results for the 24/3 fiscal year were net sales of 27,532 million yen (up 3.6% from the previous fiscal year) and operating profit of 1,975 million yen (up 117.9% from the same period). Although volume could not be increased due to a decrease in the number of newly built housing starts, sales price revisions penetrated more than expected, and along with an improvement in gross profit margin, profit increased above profit after the upward revision.

◆ Earnings forecast for the fiscal year ending 25/3
・Regarding financial results for the 25/3 fiscal year, SANEI is planning sales of 28,500 million yen (up 3.5% from the previous fiscal year) and operating profit of 2040 million yen (up 3.3% from the same period).
・The Securities Research Center (hereafter, the Center) predicted sales for the 25/3 fiscal year to be 28,500 million yen (up 3.5% from the previous fiscal year), the same amount as the SANEI plan, and operating profit was 2,092 million yen (up 5.9% from the same period), slightly higher than the company plan. Continuing from the previous fiscal year, the sales price revision effect will drive the increase in sales and profit, and the operating margin on sales was predicted to be 7.3%, up 0.1 percentage points from the previous fiscal year.

◆ Future highlights
・Our center predicted that sales would increase 4.4% from the previous fiscal year in the 26/3 fiscal year and 4.2% increase in sales in the 27/3 fiscal year, and that the operating margin on sales would rise to 7.4% in the 26/3 period and 7.5% in the 27/3 period.
・Contributions to business expansion due to sales price revisions are expected to go all over in the 25/3 period, and in the future, it is thought that the focus will be on expanding market share in the non-residential market, further improving brand power, and whether specific results of total proposals for living spaces around the water are shown, which SANEI aims for. Our center would like to continue to pay attention to whether projects can be acquired in competition with overseas brands as a litmus test.