Daikin Industries (6367)

Equity Research 4 August 2026 | 9:23PM JST

Daikin Industries (6367.T) 1Q effectively below expectations; watch mix deterioration. US recovery and defense of commercial are key going forward. Neutral

6367.T 12m Price Target: ¥24,000 Price: ¥23,690 Upside: 1.3% NEUTRAL Yuichiro Isayama n 1Q operating profits of ¥130.6 bn look broadly in line, versus | Goldman Sachs Japan Co., Ltd. GSe of ¥130.0 bn and LSEG StarMine SmartEstimates of ¥126.2 Takeru Adachi bn. However, negative factors stand out, including a boost from | Goldman Sachs Japan Co., Ltd. tariff refunds and other items (net +¥5.9 bn), mix deterioration Takato Enoki in the US, and intensifying competition in residential RA in | Goldman Sachs Japan Co., Ltd. Europe. Effectively below expectations. n Sales growth at DNA in the US is +2% yoy, which lagged Key Data _____________________________________ Market cap: ¥6.6tr / $42.1bn compared to US competitors. While volume was +10% yoy, mix Enterprise value: ¥7.1tr / $45.5bn 3m ADTV: ¥30.3bn / $188.7mn was -10% and selling prices +2% yoy, with weakness standing Japan out. We also note the company’s comment that Chinese players Japan Industrials M&A Rank: 3 are gaining ground with low-priced RA in Europe, which could be Leases incl. in net debt & EV?: No

considered Daikin’s second home market. Companies where GS Forecast __________________________________ 3/26 3/27E 3/28E 3/29E Daikin is at a disadvantage are now increasingly apparent, and Revenue (¥ bn) 5,015.0 5,250.0 5,440.0 5,680.0 Op. profit (¥ bn) New we have a negative impression of this point. Op. profit (¥ bn) Old Op. profit CoE (¥ bn) 413.0 436.0 -- -- n Whether the US can recover, and whether Daikin can defend its EPS (¥) New ,043.4 1,152.2

market share worldwide in commercial air conditioners which is EPS (¥) Old P/E (X) ,109.1 22.7 1,230.0 20.6 their main earnings driver, are likely to be key points to watch P/B (X) 1.6 2.2 2.1 2.0 CROCI (%) going forward. The deteriorating competitive environment for residential air conditioners is likely to prompt a downward 6/26 9/26E 12/26E 3/27E EPS (¥) revision to market expectations. We lower our full-year GS Factor Profile ______________________________ operating profit estimates by an average of 5% and cut our Growth

target price to ¥24,000 from ¥25,000. We maintain our Neutral Financial Returns

rating relative to our coverage. Multiple

Percentile 20th 40th 60th 80th 100th

6367.T relative to Japan Coverage 6367.T relative to Japan Industrials

Source: Company data, Goldman Sachs Research estimates. See disclosures for details.

Goldman Sachs does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclosure Appendix, or go to Analysts employed by non-US affiliates are not registered/qualified as research analysts with FINRA in the U.S.

Goldman Sachs Daikin Industries (6367.T)

Daikin Industries (6367.T) Income Statement (¥ bn) ___________________________________ NEUTRAL Rating since Aug 15, 2024 3/26 3/27E 3/28E 3/29E Total revenue 5,015.0 5,250.0 5,440.0 5,680.0 Cost of goods sold (3,283.0) (3,441.0) (3,524.0) (3,639.0) SG&A (1,318.0) (1,389.0) (1,461.0) (1,551.0) Ratios & Valuation __________________________________________ R&D ( /26 3/27E 3/28E 3/29E Other operating inc./(exp.) -- -- -- -- P/E (X) EBITDA P/B (X) 1.6 2.2 2.1 2.0 Depreciation & amortization ( ) FCF yield (%) 4.9 3.0 4.4 5.0 EBIT EV/EBITDAR (X) 8.0 9.9 9.0 8.2 Net interest inc./(exp.) ( ) EV/EBITDA (excl. leases) (X) 8.0 9.9 9.0 8.2 Income/(loss) from associates 1.3 2.0 2.0 2.0 CROCI (%) Pre-tax profit ROE (%) 9.1 8.2 9.2 9.8 Provision for taxes ( ) Net debt/equity (%) Minority interest ( ) Net debt/equity (excl. leases) (%) Preferred dividends -- -- -- -- Interest cover (X) Net inc. (pre-exceptionals) Days inventory outst, sales Post-tax exceptionals -- -- -- -- Receivable days Net inc. (post-exceptionals) Days payable outstanding EPS (basic…