Summary of the Investor Presentation on Electronic Components Industry Overview - The electronic components industry is currently rated as **In-Line** by Morgan Stanley, indicating a balanced view on potential growth and risks in the sector [1][4][9]. Key Drivers - The demand for high-performance electronic components is being driven by the expanding range of devices leveraging **AI computing** [1]. - There is an expectation that **valuations** and the sustainability of **Earnings Per Share (EPS)** growth will come under scrutiny, which may impact investor sentiment [1]. Company Ratings and Target Prices - **TDK (6762)**: Rated **Overweight** with a current price of **¥2,250** and a target price of **¥3,100**, indicating a potential upside of **38%** [8]. - **Murata Manufacturing (6981)**: Rated **Overweight** with a current price of **¥3,330** and a target price of **¥3,850**, suggesting a **16%** upside [8]. - **Niterra (5334)**: Rated **Overweight** with a current price of **¥6,967** and a target price of **¥6,300**, indicating a downside of **10%** [8]. - **Meiko Electronics (6787)**: Rated **Overweight** with a current price of **¥10,720** and a target price of **¥11,700**, suggesting a **9%** upside [8]. - **Hirose Electric (6806)**: Rated **Overweight** with a current price of **¥17,645** and a target price of **¥22,800**, indicating a potential upside of **29%** [8]. - **Ibiden (4062)**: Rated **Equal-Weight** with a current price of **¥7,158** and a target price of **¥6,500**, suggesting a downside of **9%** [8]. - **Taiyo Yuden (6976)**: Rated **Equal-Weight** with a current price of **¥3,673** and a target price of **¥3,100**, indicating a downside of **16%** [8]. - **Mabuchi Motor (6592)**: Rated **Equal-Weight** with a current price of **¥1,441** and a target price of **¥1,450**, suggesting a slight upside of **1%** [8]. - **Nichicon (6996)**: Rated **Equal-Weight** with a current price of **¥1,657** and a target price of **¥1,450**, indicating a downside of **12%** [8]. - **Hamamatsu Photonics (6965)**: Rated **Underweight** with a current price of **¥1,708** and a target price of **¥1,300**, indicating a downside of **24%** [8]. Earnings and Market Trends - The report highlights that **Capex by Hyperscalers** has increased significantly, which may influence the demand for electronic components [10]. - There is a focus on the **connector market** and the performance of various companies within this segment, including **Niterra** and **Meiko Electronics**, which are expected to show continued earnings growth [10]. Additional Insights - The report emphasizes the importance of monitoring the **gap between actual demand** and electronic component shipments in 2026, which could indicate potential supply chain issues or overcapacity [1][8]. - The **global market share trends** for specific components, such as **spark plugs** and **exhaust gas oxygen sensors**, are also discussed, indicating a competitive landscape [10]. Conclusion - The electronic components industry is poised for growth driven by AI and increased demand, but investors should remain cautious about valuations and potential scrutiny on EPS growth. The ratings and target prices for key companies reflect a mix of optimism and caution, highlighting the need for careful analysis in investment decisions [1][4][8][10].