Sanoh Industrial Balances ICE Tailwinds, China Exit and Mexico Expansion in FY2025 Outlook

Sanoh Industrial Co., Ltd. ( (JP:6584) ) just unveiled an announcement.

Sanoh Industrial reported that first-half FY2025 operating and ordinary income slightly exceeded internal plans, while net income was buoyed by a bargain purchase gain from acquiring a Mexican subsidiary, even as it prepares to book a sizable extraordinary loss tied to the dissolution and liquidation of a major Chinese subsidiary. Regional performance was mixed: Japan and Asia remained solid, the Americas faced tariff-related cost pressures and some demand timing effects, Europe continued to struggle but is benefiting from plant closures and cost cuts, and China remains challenging with declining sales and unresolved pricing negotiations, culminating in the decision to exit a large operation that will significantly reduce local sales but improve group profitability through fixed-cost reductions from FY2026. The company maintained its full-year earnings forecast, citing offsetting factors including higher North American tariffs, semiconductor-driven production adjustments, temporary disruptions at customer plants, and the fading boost from new projects in Japan, while expecting tariff pass-through to largely neutralize the impact from Q4. The newly acquired Mexican subsidiary will start contributing to earnings from Q4 FY2025, with around ¥7 billion in sales expected in FY2026 and a planned doubling by FY2027 on new programs for the U.S. Big Three automakers, positioning Sanoh to deepen its North American footprint. Strategically, management views the global slowdown in the EV shift and renewed strength in internal combustion engine demand as a tailwind for its traditional ICE-related product lines, where rivals have retrenched, even as it continues to push longer-term growth in non-ICE thermal parts, plastic cooling piping and emerging fields such as the data center business.

The most recent analyst rating on (JP:6584) stock is a Hold with a Yen816.00 price target. To see the full list of analyst forecasts on Sanoh Industrial Co., Ltd. stock, see the JP:6584 Stock Forecast page.

More about Sanoh Industrial Co., Ltd.

Sanoh Industrial Co., Ltd. is a Japanese automotive parts manufacturer whose core products include brake piping, fuel piping, and engine-related components, with a growing focus on thermal management and plastic piping for electrified vehicles. The company operates globally across Japan, the Americas, Europe, China and Asia, and is also nurturing new non-automotive businesses such as solutions for data centers as part of its longer-term diversification strategy.

Average Trading Volume: 205,403

Technical Sentiment Signal: Strong Buy

Current Market Cap: Yen31.18B

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