Mitsui Fudosan Faces Risk From Delta Variant but Office Business Appears Resilient This Year

We maintain our fair value estimate of JPY 2,700 for Mitsui Fudosan, equivalent to 0.59 times net asset value and 5% above the current share price, after it reported results for April-June, the first quarter in its fiscal year ending March 2022. Net profit for the quarter was JPY 34 billion, 21.5% of its full-year guidance of JPY 160 billion. Operating profit of JPY 35 billion was only 15.3% of full-year guidance of JPY 230 billion, but Mitsui Fudosan recorded a JPY 24 billion extraordinary gain on the sale of investment securities that bolstered the bottom line.