DD Evolution Round — 2026-05-02

Time: 04:00 JST

Stocks Evolved: IHI Corporation (7013.T) · Ibiden (4062.T) · Cover Corp (5253.T)

Selection criteria: Oldest data_date (all 2026-04-12), high conviction weight, upcoming FY catalysts within 2 weeks.

Executive Summary

Three high-conviction stocks evolved across Nuclear, Semiconductor, and VTuber themes. The primary findings:

1. IHI Corporation (7013.T) — Nuclear / Equipment

Thesis Status: HOLD

Previous data date: 2026-04-12

**Sources:** Morningstar · SimplyWallSt · IHI IR · X-energy MOU

Updated Metrics

Key Findings

1. Leadership Change (April 1, 2026)

Atsushi Sato appointed Representative Director and President of the Aero-Engine, Space & Defense Business Area. A company veteran since 1991 with deep defense/aerospace expertise. This signals IHI is doubling down on its highest-growth division (aero + defense + nuclear).

Source: TipRanks

2. GCAP Consortium — International Integration Milestone

IHI, Rolls-Royce (UK), and Avio Aero (Italy) completed transition from national contracting to fully integrated international collaboration for the GCAP next-generation fighter propulsion system. IHI holds Japan's fighter engine know-how and is poised to be the primary Japanese partner.

Source: Aero Today

3. 9M FY2026 Results (to December 31, 2025)

• Revenue: ¥1,129B (−1.8% YoY) — declining on mix shift away from lower-margin projects
• Operating Profit: ¥102.5B (−0.9% YoY) — held despite revenue decline
• Net Income: ¥85.0B (+10.7% YoY) — ACCELERATING despite top-line weakness
• EPS: ¥80.21 (post 7:1 split)
• Full-year guidance maintained: modest revenue growth + double-digit profit expansion
• Record order backlog in Q2 driven by nuclear energy and defense demand

4. Stock at 33% Discount to 52W High

Current price ~¥3,153 vs 52W high ¥4,698. Stock rose +155% in 52 weeks but has corrected. This is a potential re-entry zone ahead of May 8 full-year results.

5. Nuclear Catalyst Pipeline Intact

• X-energy MOU (Mar 2026): US-Japan SMR supply chain for Xe-100. X-energy subsequently signed 10-year graphite supply agreement with SGL Carbon — validates HALEU fuel supply chain maturity.
• NuScale $20M investment + JNI JV: NRC approved TX-1 HALEU fuel fabrication facility (Feb 2026) — first Category II commercial-scale license ever issued.
• No new IHI-specific SMR contracts since March 2026, but pipeline is progressing.

Thesis Validation

WHY this stock: Still valid. Multi-vector play: (1) nuclear SMR via X-energy and NuScale; (2) GCAP fighter engine — Japan's only partner with actual engine IP; (3) aero segment with GE/P&W providing stable cash flow. ROE improving, PE compressing = increasingly attractive.

HOLD rationale: Full-year results (May 8) are the next major catalyst. No reason to exit or reduce ahead of what could be an earnings beat. Stock at 33% discount to 52W high with strong order backlog suggests correction is a buying opportunity, not a warning sign. Thesis has not weakened.

2. Ibiden (4062.T) — Semiconductor / AI GPU Substrates

Thesis Status: UPGRADED ↑

Previous data date: 2026-04-12

**Sources:** BigGo Q3 Results · JPMorgan Upgrade · Globe and Mail Ono Plant · Nikkei 225

Updated Metrics

Key Findings

1. NI Guidance Revised +54% to ¥57B

Q3 FY2026 (9M to December 2025): Revenue ¥298.6B (+10.5%), OP ¥44.5B (+27.7%), NI ¥43.6B (+21.5%). Company revised full-year forecast from ¥37B NI → ¥57B NI (+54% revision). Revenue ¥420B, OP ¥61B maintained. The NI upgrade reflects hyperscaler ASIC revenue mix improvement.

Source: BigGo Finance

2. Google, Microsoft, Meta — Confirmed ASIC Substrate Customers

Starting 2026, Ibiden is no longer just an NVIDIA/Intel/AMD supplier. Management confirmed hyperscaler ASIC order growth for Google (TPU), Microsoft (Maia/Atlas), and Meta (MTIA). This fundamentally de-risks the customer concentration argument against the stock. Balance sheet carries ¥92.1B in customer advance payments — NVIDIA, Intel, and hyperscalers are pre-funding Ibiden's factories.

Source: JPMorgan upgrade · Yahoo Finance

3. ¥500B Capex Plan — Ono + Gama Plants

February 2026: Ibiden announced ¥500B total capex for AI substrate capacity. Additional ¥280B specifically for Ono Plant and domestic/overseas sites. Gunma and China facilities also being expanded. Scale of commitment signals Ibiden sees multi-year structural demand.

4. Nikkei 225 Index Inclusion (November 5, 2025)

Ibiden replaced Nidec (removed due to accounting scandal) in the Nikkei 225. Index inclusion creates structural buying demand from passive funds and rebalancing flows. Likely contributed to stock price appreciation.

Source: Nikkei Asia

5. JPMorgan Upgrade to Overweight

JPMorgan cited ABF substrate technological advantages for AI-use GPUs and ASICs, with price target based on post-ramp earnings at Ono and Gama plants. The broker upgrade validates the long-term thesis.

Thesis Validation

WHY this stock: STRENGTHENED. Customer base expanded from 3 (NVIDIA/Intel/AMD) to 6+ (adding Google/Microsoft/Meta ASIC). NI guidance revised +54%. Nikkei 225 inclusion creates permanent demand. ¥92.1B advance payments from customers validates demand durability.

UPGRADED rationale: The original thesis was "NVIDIA cannot make GPUs without Ibiden." The evolved thesis is: "No major AI company — NVIDIA, Google, Microsoft, Meta — can build its flagship AI chip without Ibiden." This is a fundamental widening of the moat. The PE expansion from 72x to 112x is steep, but forward PE at 62x with ¥500B capex nearly fully funded by customers is a different risk profile than typical capex-heavy companies.

3. Cover Corp (5253.T) — VTuber Agency / IP Platform

Thesis Status: UPGRADED ↑

Previous data date: 2026-04-12

**Sources:** LogMi Q3 results · VTuber Sensei FY2025 · Cover Corp IR · ANN COVER USA

Updated Metrics

Key Findings

1. Operating Margin Surge: 11.3% → 19.1%

The most significant metric change. Cover Corp's operating leverage is proving out as predicted: incremental revenue from TCG merchandise, events, and concerts carries near-zero marginal cost (IP is replicated at scale). 8-point op margin expansion in one year is exceptional for any entertainment company. FY2030 target of ¥25B OP on ¥100B revenue implies sustaining ~25% op margins.

Source: StockAnalysis

2. FY2026 Guidance: ¥52.5B Revenue (+20.9% YoY)

Q3 FY2026 (quarterly): Revenue ¥11.758B (+69.2% YoY), OP ¥2.171B (+83.0%), NI ¥1.656B (+71.2%). Full year guidance ¥52.5B vs FY2025 ¥43.4B = strong confidence in continued growth.

3. hololive OFFICIAL CARD GAME — Top Revenue Driver

Launched September 2024, the TCG accounted for ~60% of Q1 FY2026 merchandise revenue (¥5.84B of ¥9.63B). This single product transformed Cover's revenue mix and is the primary driver of margin expansion. Recurring set releases and community engagement suggest durable revenue stream.

4. Holostars Restructuring (April 3, 2026) — Cost Discipline

Cover restructured its male VTuber segment (Holostars), transitioning to individual-led activities rather than company-managed promotion. Reduces overhead. Signals management is focusing resources on highest-ROI talent segments.

5. Hoshimachi Suisei — Personal Agency Risk

Suisei (one of Hololive's top talents by channel size) launched personal agency "Studio STELLAR" in 2026, operating within a new framework with Cover. This is the first major talent independence event and signals that high-value creators are seeking more control over their career/revenue. If this pattern spreads to Gura, Pekora, or Kuzuha-equivalent talents, it is thesis-threatening.

6. Overseas Expansion Milestones

• hololive English 4th concert "Serendipity": July 3-4, 2026 at Shrine Auditorium, Los Angeles. First major US arena concert — key overseas monetisation proof point.
• COVER USA established 2024 for B2B licensing.
• hololive SUPER EXPO 2026 + 7th fes: October 2026.

7. Scale: 87 Talents, 92M YouTube Subscribers

43 active members with 1M+ subscribers each. Top talent scale provides revenue defensibility even against individual departures.

Thesis Validation

WHY this stock: STRENGTHENED. The IP leverage model is proving out faster than expected. Op margin expansion to 19.1% ahead of the FY2030 ¥25B OP target shows Cover is not just growing revenues but converting them to profit efficiently.

UPGRADED rationale: Forward PE of 13.3x at 19.1% op margin and 69% quarterly revenue growth is attractive for a company executing at this level. The Suisei agency risk is real but not thesis-breaking — Cover still controls the distribution relationships and brand. The upgrade is driven by op margin data, not just growth.

Errata

Upcoming Catalysts (May–October 2026)

Methodology

• Metrics sourced from StockAnalysis.com, Yahoo Finance, Morningstar, Investing.com
• Company news from SimplyWallSt, TipRanks, Nikkei Asia, Anime News Network, VTuber Sensei, LogMi Finance
• Supply chain evidence from confirmed press releases and analyst research
• Forward PE and estimated metrics clearly marked as calculated/estimated

*This report is for research purposes only and does not constitute investment advice. All metrics as of date noted — verify before acting.*