2015 All-Japan Research Team: Plant Engineering & Shipbuilding, No. 1: Taku Ouchi

Taku Ouchi

SMBC Nikko Securities

First-Place Appearances: 3

Total Appearances: 4

Analyst Debut: 2012

For a third year running, SMBC Nikko Securities’Taku Ouchiis the top analyst covering Japan’s plant engineering and shipbuilding companies. Investors express great respect for his intellect. “His knowledge of heavy industry is quite impressive,” observes one backer. “He’s like a walking encyclopedia.” Two players in that segment are among the 37-year-old Ouichi’s favorites. He deems both Kawasaki Heavy Industries and Mitsubishi Heavy Industries sector stars, expecting each to outperform. As of late March their shares had advanced 65.1 percent and 15.5 percent, respectively, during the preceding 12 months, while the domestic sector rose 19.6 percent. Specifically, Ouchi expects Hyogo-based Kawasaki to benefit as sales of its aircraft engines, plant equipment and rolling stock continue to improve. Driving this expansion are such trends as the decline in global motorcycle turnover and the build-up of demand for industrial robots and related products. At ¥616 in late March, Kawasaki’s stock earns a price target of ¥660. Regarding Tokyo’s MHI, the researcher projects that all corners of the company will perform well and contribute to profits. Catalysts include increasing orders for coal-fired power plants; synergies in the manufacture of thermal power systems in the wake of Mitsubishi’s February 2014 tie-up with Hitachi; and growth in after-sales services for gas turbines that fire combined-cycle power plants. Deeming the stock “heavily undervalued” — it was trading late last month at ¥670.80 — Ouchi pegs MHI at ¥920.