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TOKYO, Dec 25 (AFP): Returns on equity for listed companies in Japan are expected to rise by a record 8.9 per cent in this business year, bolstered by higher profits and more share buybacks, a report said Saturday.
The increased rate for the companies, which close their books in March, will be up 1.3 percentage points from the preceding year, the leading business newspaper Nihon Keizai Shimbun said.
It added that due to restructuring efforts and a recovering economy, overall net profits are projected to surge 28 per cent to a record level in the business year.
Such figures are closely watched by the stock market, and the improvement is expected to whet investor appetites for Japanese stocks, the daily said.
However, returns for Japanese companies was expected to still be lower than those in the United States, where return on equity is almost 15 per cent, as well as Germany and Britain where the average return tops 10 per cent.
Steelmakers and trading houses in particular are enjoying sharp profit gains, as are other firms in commodity-related sectors, the report said.
Nippon Steel Corp's return on equity was seen jumping 3.1 percentage points to 23.8 per cent on decreased assets and debts as well as higher steel prices. JFE Holdings Inc's returns were seen climbing to almost 30 per cent.
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