Japan Post Holdings: Focus on Discount Narrowing on Earnings Improvement Excluding Financial Subsidiaries

Goldman Sachs maintains a Buy on Japan Post Holdings following a briefing on its FY3/26 results and medium-term plan, highlighting efforts to improve earnings in postal and real estate units to reach a 5-7% ROE target by FY3/29.

Key Takeaways

• 1.Japan Post Holdings is focusing on earnings improvement in its non-financial subsidiaries (postal and real estate) to reach a group ROE target of 5-7% by FY3/29.
• 2.The real estate business is a key focus area, with plans to improve capital efficiency by shifting towards property sales and management businesses while reducing depreciation burdens.
• 3.Goldman Sachs maintains a Buy rating, viewing the company as 'strongly undervalued' with an estimated negative current value of around -¥1.4 tn when excluding financial and other major stakes.

Table of Contents

• Japan Post Holdings (6178.T): Briefing: Focus on discount narrowing on earnings improvement excluding financial subsidiaries; Buy
• Price Target Risks and Methodology - Japan Post Holdings
• Disclosure Appendix
• GS Factor Profile
• M&A Rank
• Quantum
• Price target and rating history chart(s)
• Target price history table(s)
• Regulatory disclosures

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