Kawasaki Heavy Industries (7012.T): Group Vision Progress Meeting—Watching the Response to a Changing Demand Environment; Neutral Rating Maintained
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Kawasaki Heavy Industries (7012.T) held a Group Vision 2030 progress briefing on the afternoon of October 6, 2026, its first in roughly three years, centered on deploying the roughly ¥200bn raised in July: about ¥100bn toward four core businesses—aerospace and engines, gas turbines, shipbuilding and semiconductor robots—and ¥100bn toward physical AI and the hydrogen supply chain. The company lifted FY3/31 targets to revenue above ¥3.3tn, operating profit above ¥330bn and operating margin above 10%, with a current WACC assessment of about 10%, ROIC of 13% (roughly a 3-point spread) and ROE of 15%. Cumulative FY3/28–FY3/31 cash allocation totals ¥1.3tn—¥550bn growth investment, ¥550bn recurring investment and ¥200bn shareholder returns under a 4% DOE policy. Segment plans include defense revenue of ¥700–800bn by FY3/31 (over ¥1tn by the mid-2030s), mid-size gas turbine capacity up 2.3x by FY3/31 and about 5x by FY3/36, semiconductor robot capacity doubling by FY3/30 with revenue rising from about ¥38bn to ¥160bn by FY3/36, and FY3/36 energy operating profit of ¥40bn. Goldman Sachs maintains Neutral (12-month target price ¥3,200), flagging potential challenges in mass production for new-warfare defense equipment and monetization timing of new robot businesses, while tracking operating profit growth and the 15% ROE goal.
Key exhibits
Exhibit 1
