Komatsu Ltd

6301: XTKS (JPN)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	¥‎4,868.00	Shnbngr	Nntpsksnr

Komatsu Q2 Fiscal 2021 Tad Above Expectations; Raised Full-Year Guidance, Gradual Recovery Expected

, Pujance Chan

Oct 29, 2020

We increase our fair value estimate for Komatsu to JPY 2,310 per share (USD 22 per ADR) from JPY 2,150 (USD 20.50 per ADR) after taking into account the slightly-better-than-expected second-quarter performance and management’s more optimistic guidance for fiscal 2021 (ending March) as business operations start to recover from the COVID-19 outbreak. Our narrow moat and stable moat trend ratings remain intact. We think the shares are fairly valued at the current price, with a gradual recovery in machinery sales priced in.

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