New Breed Of 'Growth Stocks' Spearheading Market Gains

TOKYO (Nikkei)--Companies that have successfully cultivated demand for their products and services, as well as those benefiting from Abenomics, have driven the stock market to a level last seen before the 2008 Lehman crisis.

Shifts in global demand after Lehman Brothers Holdings Inc. filed for bankruptcy exacted a heavy toll on traditional blue chip firms, weighing down their earnings and shares prices. The shares logging the sharpest gains between Sept. 12, 2008, just prior to Lehman's filing, and Friday belong to companies that have developed demand on their own terms and forayed into new markets.

Baby goods manufacturer Pigeon Corp.'s (7956) stock doubled during the period, reflecting the popularity of its products overseas. Nurturing its baby bottle line into a high-end brand in China and elsewhere, Pigeon will target a fourth straight record net profit for the year ending in January 2014.

Sanrio Co. (8136) more than tripled its share price after Hello Kitty licensing arrangements with H&M Hennes & Mauritz AB and others paid off.

Softbank Corp.'s (9984) stock has more than doubled due to the popularity of smartphones, which have been a boon for its mobile phone services. Anritsu Corp. (6754) has more than quintupled its share price, thanks to brisk demand for measurement devices used in the development of smartphones and other handsets.

Internet stocks have posted solid gains as well by tapping demand in online markets. The stock of MonotaRO Co. (3064) has soared 10-fold, underpinned by the firm's new business model of selling machine tools to factories via the Internet.

Start Today Co. (3092), which devised an easier way to describe clothing measurements online, proved naysayers wrong by showing that consumers are willing to buy apparel over the Internet, even if they cannot physically try it on. Its share price has almost tripled since before the Lehman crisis.

Others have benefited from the repercussions of Prime Minister Shinzo Abe's economic policies, such as the sharp retreat in the yen. Automakers and others that stand to see higher earnings from a weaker currency have logged big gains. For Toyota Motor Corp. (7203) and Honda Motor Co. (7267), improved export margins were the icing on the cake of recovering new-car sales.

Mitsui Fudosan Co. (8801) and others have also rallied on hopes for more aggressive monetary easing by the central bank that could spark sharp inflows into real estate.

But consumer electronics and other sectors that have lagged in responding to changing demand have yet to recover their pre-Lehman levels.

With TV prices dropping sharply, Panasonic Corp. (6752) and Sony Corp. (6758) both suffered record net losses for the year ended March 2012.

(The Nikkei, March 9 morning edition)

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