Nomura Unveils 2030 Strategy; Sees Over 500 Bln Yen Income, Growth In US Business

Nomura Holdings announced its business strategy through 2030, targeting income before income taxes exceeding 500 billion yen and an ROE of 8%-10% by expanding into private markets. The firm plans to strategically allocate resources to strengthen its presence in the Americas, particularly the U.S., despite market volatility, citing the region's rich business opportunities. Nomura aims to increase assets under management to over 150 trillion yen by fiscal year 2030/31, with targeted income before income taxes at 100 billion yen.

Analysis

Nomura Holdings, Inc. (NMR) has unveiled a comprehensive business strategy extending to 2030, aiming for sustainable growth with specific financial targets, including consistently achieving income before income taxes exceeding 500 billion yen and a return on equity (ROE) of 8% to 10% or more. This growth is anticipated to be driven by an expansion of its business scope from public to private markets. A significant component of this strategy involves strengthening its focus on the Americas, primarily the United States, through strategic resource allocation, a move underscored by CEO Kentaro Okuda's statement highlighting the U.S. as the "most important area rich in business opportunities," despite current market volatility surrounding global tariff negotiations. In its Investment Management division, Nomura targets an increase in assets under management (AuM) to over 150 trillion yen by fiscal year 2030/31, which includes public assets, alternative assets, and assets from the scheduled acquisition of Macquarie operations, with a corresponding income before income taxes target of 100 billion yen for this segment. The market responded with a modest uptick, as Nomura shares closed 0.51% higher at 888.30 yen in Tokyo on the day of the announcement, supported by a 'strongly positive' sentiment score of 0.75 and an 'optimistic' tone regarding the company's outlook.

Key Decisions for Investors

• Investors should assess the long-term value creation potential from Nomura's strategic pivot towards private markets and its reinforced commitment to the U.S. market, considering the ambitious financial targets set for 2030.
• Monitor Nomura's execution capabilities in expanding its AuM, particularly through the integration of Macquarie operations and growth in alternative assets, as this is crucial for achieving the 150 trillion yen target and 100 billion yen income in Investment Management.
• Evaluate the risk-reward profile of increased resource allocation to the Americas, especially given the acknowledged market volatility, and how effectively this strategy contributes to achieving the targeted ROE of 8-10% or more.