• New businesses drive sales growth in mature telecoms market – Okinawa Cellular, the regional subsidiary of KDDI (9433), is addressing the challenge of growing sales in a mature telecoms market by targeting two key areas: Solutions – offering telecommunications and digital solutions in the prefecture, where its local presence gives it an edge, and au Denki – offering electricity plans. These two businesses are expected to drive nearly all the new sales increase of 18.6% (compared to FY3/25) targeted under the Medium-Term Management Plan (FY3/26-FY3/31) to ¥100 billion, amid slower growth in the core telecoms business. Although these new businesses are likely to have lower margins, with a price hike at its flagship mobile au brand, incremental operational efficiencies, and measures to stem churn, we believe the company can maintain its sector-leading OPM over the medium term.
