• Underlying performance remained solid – Despite one-off inbound travel disruption during June to August 2025, Q1-2 FY3/26 results demonstrated strong and sustained YoY growth. We interpret this as Polaris’s earnings stream becoming more resilient and predictable, with improved quality of earnings. FY3/26 guidance has been upwardly revised, indicating robust earnings visibility for Q3-4 FY3/26, and the company has increased DPS to ¥4.0 from ¥3.0, with capital allocation demonstrating a well-structured balance between active growth investments and improving shareholder returns. Ongoing regional expansion and the completion of the “KOKO HOTELS” rebrand by April 2026 should deepen repeat-traveller penetration and broaden customer reach.
