Feb. 9 (Bloomberg) -- Japanese paper makers gained the most in the Topix Index’s 33 industry groups after Nippon Paper Group Inc. yesterday posted growing profit and amid speculation shares in the sector are cheap.
Tokyo-based Nippon Paper jumped 5.8 percent to 1,771 yen, at 12:59 p.m. in Tokyo. Mitsubishi Paper Mills Ltd. surged 12 percent to 85 yen and Hokuetsu Kishu Paper Co. climbed 4.4 percent to 541 yen. The three papermakers had three of the four- biggest gains today in the Nikkei 225 Index, which dropped 0.5 percent.
Operating profit at Nippon Paper increased almost 40 percent to 10.2 billion yen ($132 million) in the quarter through December from 7.33 billion yen in the previous three months as production recovered from the March earthquake and costs were reduced, the company said. Quarterly earnings were calculated by subtracting first-half profit from nine-month figures reported yesterday by the papermaker.
“Nippon Paper’s earnings triggered gains across the sector,” said Yoshihiko Tabei, senior analyst at Kazaka Securities Co. “The shares were ready to move because the sector has lagged behind other stocks and many of these companies look undervalued.”
The Topix Pulp & Paper Index climbed 3.5 percent compared with a decline of 0.3 percent in the broader Topix Index today.
--Editor: Nick Gentle
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