(April 23): Kioxia Holdings Corp made the list of Japan’s 10 biggest companies by market capitalisation for the first time, after rising prices for its core product — NAND flash memory — helped propel a rally in its share price.
The company’s value rose to ¥19.3 trillion as of the market close, putting it in 10th place and up from the 43rd spot at the end of last year. Its stock rose 1.7% on Thursday amid a global artificial intelligence (AI) rally to the highest since its jumbo IPO in December 2024.
NAND flash memory, which is used in servers for AI applications, has seen heavy demand as US tech giants ramp up their AI investments, providing a strong tailwind for the shares of memory makers such as Sandisk Corp and Samsung Electronics Co.
“Investors have begun in earnest to price in a sharp increase in profits for the current fiscal year driven by higher memory prices,” said Kazuyoshi Saito, senior analyst at Iwai Cosmo Securities Co. Market attention is shifting towards memory stocks, which appear undervalued even among chip shares that are resilient to geopolitical risks, he added.
Kioxia’s shares have risen over threefold so far this year, pushing its market value past trading house Mitsubishi Corp, lender Mizuho Financial Group Inc and defence contractor Mitsubishi Heavy Industries Ltd.
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Analysts forecast Kioxia’s net income to increase by five times in the current fiscal year ending March, to around ¥2.5 trillion. That would make it the second biggest profit-earning company in Japan, behind only Toyota Motor Corp in Japan.
Even so, the company’s forward price-to-earnings ratio is just below eight times, “suggesting the stock still appears undervalued, and the upward trend in its share price is likely to continue over the long-term,” Saito said.
Kioxia is a favourite among retail day traders and hedge funds due to its high volatility. “While long-term investors are adopting a buy-and-hold strategy, short-term players are accelerating the stock’s gains,” said Ikuo Mitsui, a fund manager at Aizawa Securities Co.
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