Shikoku Electric Power Co. (9507) fell as much as 17 percent, the sharpest drop since at least 1974, leading Japanese utilities lower in Tokyo after power companies reported first-quarter losses.
Shikoku Electric declined as much as 210 yen, heading for its lowest close since 1983. Kansai Electric Power Co. slipped as much as 6.5 percent to 550 yen, while Chugoku Electric Power Co. plunged up to 10.9 percent. The 17 member TOPIX Electric Power & Gas Index (TP17ELEC) declined as much as 3.5 percent.
Shikoku and six other nuclear utilities in Japan this week reported a combined quarterly loss of 268 billion yen ($3.4 billion) as the shutdown of atomic stations drove up fuel costs to run oil- and gas-fired plants. All but two of Japan’s 50 reactors are idled for safety checks after the Fukushima nuclear disaster caused by the quake and tsunami in March 2011.
Shikoku Electric was relatively overvalued, said Reiji Ogino, a Tokyo-based analyst at Mitsubishi UFJ Morgan Stanley Securities Co. who rated the company underperform on June 8.
“Today’s decline in Shikoku’s stock price could be considered a correction,” Ogino said today in an e-mailed response to questions. “Shikoku’s price-to-book ratio is 0.7, the highest of any power company.”
Shikoku Electric posted a loss of 15 billion yen in the three months ended June 30, the company said yesterday. Kansai Electric (9503), the most dependent on nuclear among the country’s power utilities, had a loss of 99.5 billion yen for the quarter, compared with a 34.5 billion yen profit a year earlier. Chubu Electric reported a quarterly loss of 12.5 billion yen on July 30.
With the exception of Tokyo Electric Power Co., none of Japan’s nuclear plant operators provided a profit or loss forecast for this fiscal year, citing uncertainty about nuclear plant restarts and power saving effects on electricity demand.
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