Buy Rating for SMFG: Strong Earnings and Strategic Management Drive Positive Outlook

Lim Rui Wen, an analyst from DBS, maintained the Buy rating on Sumitomo Mitsui Financial Group (SMFNF – Research Report). The associated price target is Yen4,100.00.

Lim Rui Wen has given his Buy rating due to a combination of factors including strong earnings performance and strategic management decisions. The Sumitomo Mitsui Financial Group (SMFG) has shown robust financial results in the third quarter of FY25, driven by increased lending income and higher fee income. Management’s guidance suggests that previous rate hikes are expected to significantly boost net interest income, which positions the company well for future growth.
Additionally, SMFG is poised for further improvements in return on equity (ROE), supported by strong domestic loan demand and favorable economic conditions. The company’s strategic focus on reducing cross-shareholdings and balancing growth investments is expected to act as a catalyst for its stock re-rating. Furthermore, the potential for increased contributions from investments in Asia and a substantial share buyback program further solidify the positive outlook for SMFG, justifying the Buy rating with a target price of JPY 4,100.