Goldman Sachs Ajinomoto (2802.T): Conference Call Takeaways: ABF's Competitive Advantage and Stance on Price Hikes Confirmed
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Goldman Sachs highlights key takeaways from Ajinomoto's recent conference call, which reaffirmed the competitive advantage of its ABF (Ajinomoto Build-up Film) substrate material and the company's firm stance on implementing price hikes. ABF maintains over an 80% global market share in semiconductor packaging, underpinned by unique material properties and entrenched customer relationships that competitors cannot easily replicate.
Management confirmed plans to further raise ABF prices in 2026 to offset rising raw material and energy costs. Because ABF is indispensable in advanced packaging, customer acceptance of these price increases remains high. Demand is robustly driven by artificial intelligence, high-performance computing, and data centers, resulting in strong order visibility for 2026. To support this growth, Ajinomoto is expanding production capacity, with a new manufacturing line expected to come online in the second half of 2026, adding approximately 20% to ABF capacity.
The company guided for 15% year-over-year revenue growth in its ABF segment for the fiscal year ending March 2027, exceeding prior market expectations. The ABF business operates at a roughly 40% profit margin, serving as a primary driver for overall profitability improvements. Goldman Sachs notes that Ajinomoto targets a 12% operating margin for the full fiscal year. The firm maintains a Buy rating, citing high earnings certainty and favorable secular demand trends.