Dai Nippon Printing Co.’s shares rose sharply Friday morning after the Japanese company announced a large share buyback and other steps to boost earnings and capital efficiency as part of a new mid-term plan.
The shares were recently 6.9% higher at 4,050 yen after rising as much as 9.8% earlier.
Dai Nippon said Thursday after the market closed that it planned to buy back 300.0 billion yen ($2.20 billion) of its own shares during the three-year period starting April, including a Y100.0 billion buyback in the first fiscal year.
The program may repurchase up to 15% of outstanding shares over the next year, it said.
Dai Nippon also said it would invest Y260.0 billion in areas such as photomasks used in semiconductor production and lithium-ion battery pouches, and reduce holdings of shares in other listed companies on its balance sheet.
The company said it aimed to increase its operating profit to Y85.0 billion in the fiscal year starting April 2025 from Y67.0 billion projected for this fiscal year and improve its return on equity to more than 8% from 6.0%.
Elliott Management Corp., a shareholder in Dai Nippon, said the steps announced by the Japanese company demonstrate its commitment to addressing its undervaluation and that the investment manager looks forward to continuing the dialogue with the company as it executes its plan.