In this briefing:
1. Japan Tobacco: No Dire Consequences Despite Late Entry to Heated Tobacco
- Late entry to Japanese heated tobacco market resulted in Japan Tobacco (2914 JP) losing market share to peers
- New product launches to give Japan Tobacco a fighting chance against IQOS
- Early maturity of heated tobacco in Japan: a blessing in disguise for Japan Tobacco
- Pricing power is expected to be back on track in future
- PloomTECH will soon be ready to compete with IQOS at a global level
- More product offerings targeting different customer needs in reduced risk products category
- International segment volume growth driven by global flagship brands and acquisitions
- Market unjustly penalising Japan Tobacco for the early maturity of heated tobacco segment
- Transformation of dividend yield from industry worst to industry best
- Undervalued at 10.09x EV/Forward EBIT: DCF target price yields 21.8% upside
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