In today’s briefing:
- What Should a Japanese Company Do to Raise Profit Margin, a Prerequisite for Higher ROE?
What Should a Japanese Company Do to Raise Profit Margin, a Prerequisite for Higher ROE?
- TSE, as market operator, should focus on stimulating the market, not informally meddling in the management of listed companies on matters that are not explicitly stated in the listing criteria.
- Much of the reason ROE has not increased is that OP Margin has not increased. Despite gradual unwinding of cross-shareholdings, Total Asset Turnover slide and Financial Leverage remained unchanged.
- Increasing OP Margin is prerequisite for ROE to rise. It confirms that the root of the problem is the challenge of using cash for growth investments to create competitive products.
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