Shimano Shares Rise Sharply After Guidance Upgrade on China Road Bike Demand
By Kosaku Narioka
Shimano's shares rose sharply after the company raised its net profit forecast for 2024, citing strong demand for road bikes in China.
Shares were recently 5.7% higher at 25,520 yen after rising as much as 6.6% earlier.
Shimano said Tuesday after the market closed that it projected net profit to climb 8.4% to 66.30 billion yen ($428.2 million) in 2024, up from its previous forecast of Y54.00 billion.
The Japanese maker of bicycle parts and fishing equipment said demand for road bikes in the Chinese market has been stronger than previously anticipated and that gross profit margin improved in the first quarter.
Shimano also said it would buy back up to Y26.00 billion of its own shares by the end of March 2025.
First-quarter net profit rose 17% from a year earlier to Y23.69 billion even as revenue dropped 20% to Y100.56 billion due partly to weak private consumption amid high inflation in many markets.
Write to Kosaku Narioka at kosaku.narioka@wsj.com
(END) Dow Jones Newswires
April 23, 2024 23:32 ET (03:32 GMT)
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