Nidec shares slump over 9% after it retains annual profit outlook

TOKYO (Reuters) -Nidec shares tumbled more than 9% on Tuesday after the electric motor maker kept its annual profit outlook unchanged the previous day despite reporting a rise in quarterly profit.

Some analysts said the unchanged profit outlook of 220 billion yen ($1.47 billion) for the current year to March 2024 came short of market consensus, while also voicing concerns over declining margins in the Chinese automotive business.

“The e-axle market in China is shifting more rapidly than expected to lower output motors and that is having a detrimental impact on profitability,” analyst Mark Chadwick wrote on the Smartkarma research platform.

“We are still concerned about the outlook for the Chinese EV market and the shift to lower output motors, which is impacting profitability.”

After the market close on Monday, the Kyoto-based company announced a 7.6% rise in quarterly operating profit, helped by stronger sales and a weaker yen currency.

The company’s shares were trading down 9.2% by mid-morning, after being untraded with a glut of sell orders earlier in the day.

($1 = 149.6500 yen)

(Reporting by Mariko Katsumura; Editing by Jacqueline Wong and Muralikumar Anantharaman)