Kansai, in which U.S. activist investor Elliott became a large minority shareholder last month, lifted its annual profit forecast by 22% to 360 billion yen ($2.4 billion) on Thursday, on higher electricity demand and stronger-than-expected earnings at its fuel trading unit.
It also increased its full-year dividend forecast to 75 yen per share from 60 yen and promised a consolidated payout ratio target of 25-35% from the next fiscal year.
Kansai’s shares were up 5.2% by 0512 GMT, outperforming the wider Nikkei index which was 1.9% higher.
The stock has risen around 7% since September 10, when Elliott disclosed its shareholding. Shares in Tokyo Gas , where Elliott is a shareholder since November 19 last year, were 42% higher to the date.
Elliott is pushing both companies to increase shareholder value by selling non-core assets, including their vast real estate portfolios. A source familiar with the matter said earlier Elliott wanted Kansai to raise dividend to 100 yen. This week, Tokyo Gas raised full-year profit forecast to 194 billion yen, up from 131 billion yen, as it plans to book 30.7 billion yen profit from property sales. Kansai views real estate as a necessary business it wants to grow, an executive said. ($1 = 150.7800 yen) (Reporting by Katya Golubkova; Editing by Janane Venkatraman)