Japanese Stocks Gain Attention Amid Steady Inflation

Japan's latest inflation data shows mixed results, with core CPI holding at 2.7% year on year in June and core core CPI easing to 2.0%. This reduces pressure on the Bank of Japan (BOJ) to lift rates further.

The BOJ stance has kept attention on domestically focused stocks that depend heavily on consumer spending. Three Japanese companies, Chiyoda, Arclands, and JINS HOLDINGS, have been identified as positively exposed to this inflation backdrop.

Chiyoda is a long-established footwear group with a nationwide footprint of shoe stores in Japan. It generates all revenue from its Footwear Business in Japan, with ¥80.98b in revenue. Analysts expect earnings growth, but returns on equity are forecast to remain low.

JINS HOLDINGS provides focused exposure to consumer spending through eyewear, with reported growth and double-digit net margins. The stock is trading below estimated fair value, making it an attractive option for investors.