Total sales by firms listed on the Tokyo Stock Exchange’s first section are expected to log their first rise this year since fiscal 2007, according to a tally by Nikko Cordial Securities Inc.
The sales growth is attributable to brisk demand in China and other emerging economies. Profits are also expected to collectively post substantial increases, the brokerage said.
But speculation has surfaced that the recovery in the global economy may slow down because of Greece’s debt crisis, and the companies’ profits may also not grow as much as expected amid concerns about the yen’s appreciation, the high cost of resources and deflation.
The brokerage made the projection by collating earnings projections by 374 firms as of last Friday, excluding financial institutions.
According to the tally, combined sales would rise 6.6 percent from the previous year and net profit would jump 49.0 percent, both showing a steady recovery, although they would fall short of the level before the 2008 collapse of Lehman Brothers Holdings Inc.
The number of firms so far collated covers about 30 percent of the total, but other firms’ earnings reports are expected to show similar trends. Overall sales of all listed firms are expected to rise between 5 and 10 percent, according to the brokerage.
For fiscal 2009, which ended in March, sales by the 374 firms fell 14.1 percent from the previous year, but their net profits jumped 96.3 percent due to a very low level the year before.
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