Hello Kitty owner Sanrio jumps as tourism rebound lifts earnings

SANRIO surged after earnings at the brand owner of Hello Kitty rebounded as Japan saw tourism spending exceed pre-pandemic levels.

Shares soared as much as 11 per cent, the most in three months, after quarterly results beat analyst estimates on Nov 2, the day before Japan’s equity market was closed for a national holiday. The company’s stock has surged more than 50 per cent so far this year, double the gain of the benchmark Topix.

Inbound tourism has been a bright spot in Japan’s economic recovery as a weaker yen boosts the spending power of visitors from abroad. Transportation providers ANA Holdings and West Japan Railway recently reported solid results as the number of foreign visitors recovers towards pre-pandemic levels.

The first half of the year was helped by the “brisk flow of both domestic customers and foreign tourists”, according to a Sanrio statement. As a result, sales rose 43 per cent from a year before.

Sanrio’s full-year operating profit may overshoot guidance, given that its second-half forecast looks cautious, Hirotoshi Murakami, an analyst at Mitsubishi UFJ Morgan Stanley Securities, wrote in a note. BLOOMBERG