⚠ Gains That Will StopModerate threat

Tokio Marine Holdings (8766) — threat to the moat

Two-fifths of Tokio Marine's reported Japanese GAAP profit last year came from selling shares it will soon run out of.

Under Japanese GAAP, gains on selling strategic equities count in net income. Tokio Marine's JGAAP adjusted net income was ¥1,204.8 billion in the latest year, but excluding those gains it was ¥711.6 billion1: about ¥493 billion came from the sales2.

Year to March 2026 (¥ bn)1,204.8JGAAP adjusted net income711.6Excludingequity-sale gains881.5IFRS adjusted net income531.3IFRS net incomeTokio Marine results presentation and IFRS results, 2026
Four measures of one year's profit.

The IFRS figures, which the company now reports, exclude those gains from profit: IFRS net income was ¥531.3 billion against JGAAP's ¥980.4 billion34. The company's new adjusted measure, ¥881.5 billion5, also excludes all capital gains.

When the equities reach zero, the gains end. Investors who valued the company on JGAAP earnings were partly valuing a one-time liquidation.

Japanese GAAP return on equity shows the same inflation: 15.9% in the year to March 2024, 20.6% in 2025 and 18.7% in 202667, against IFRS return on equity of 6.2% and 7.1% for the last two years8.

The measure is IFRS adjusted net income. The current year's guidance is ¥950.0 billion9; growth on that basis is the only kind that lasts.

References
  1. ReportedTokio Marine's JGAAP adjusted net income was ¥1,204.8 billion in the latest year, but excluding those gains it was ¥711.6 billion: about ¥493 billion came from the sales.
    Tokio Marine Holdings, FY2025 results and FY2026 projections presentation - adjusted net income, strategic equity sales, shareholder returns and the FY2026 plan. — FY to March 2026 · publ. May 2026 · source ↗
  2. Moat Explorer calcTokio Marine's JGAAP adjusted net income was ¥1,204.8 billion in the latest year, but excluding those gains it was ¥711.6 billion: about ¥493 billion came from the sales.
    Moat Explorer calculation from Tokio Marine's reported figures. Market value: ¥7,932 x 1,899,994,045 shares outstanding (1,934,000,000 issued less 34,005,955 treasury at 30 June 2026) = ¥15.07 trillion; over JGAAP net income of ¥980.4bn = 15.4 times; over IFRS adjusted net income guidance of ¥950.0bn = 15.9 times; over ordinary income of ¥8,872.3bn = 1.70. March year-end P/E (company market value over JGAAP net income): 3,536.2 / 273.8 = 12.9 (2017) ... 14,133.7 / 980.4 = 14.4 (2026). IFRS trailing net income: 531.3 - 256.0 + 264.3 = 539.6. Japan non-life shares: MS 19% + AD 14% = 33% against TMNF 27%. Equity-sale gains inside JGAAP adjusted net income: 1,204.8 - 711.6 = 493.2. Strategic equities: 1,964.3 / 3,605.6 - 1 = -45.5%. International share of IFRS adjusted net income: 578.5 / 881.5 = 65.6%; Japan P&C 234.7 / 881.5 = 26.6%. NICO share price against the current price: 7,932 / 5,962 - 1 = +33%. First-quarter progress: 261.4 / 950.0 = 28%; 264.3 / 830.0 = 31.8%. Agrihedge goodwill: 71.8 / 150.0 = 48%; Ignyte 54.5 / 102.8 = 53%. PHLY profit growth: 1,265 / 180 = 7.0 times. Bonds and borrowings over equity: 598.0 / 7,955.6 = 0.075. Segment ordinary profit shares, year to March 2026: domestic non-life 744.5 / 1,348.6 = 55%; international 559.1 / 1,348.6 = 41%. Domestic non-life profit against strategic equity sales: 744.5 against 745.6. Dividends: 218 / 36.7 = 5.9 times since the year to March 2016 (split-adjusted). Market value since March 2017: 14,133.7 / 3,536.2 = 4.0 times. Unrealized loss change: 914.6 - 590.5 = 324.1. Auto rate increases compounded: 1.035 x 1.085 = 1.123. CRE loan book: 8.73 / 11.21 - 1 = -22%. Distributions: 860.6 / 267.6 = 3.2 times. Nat-cat losses against the 10-year average: 131.2 / 160.9 = 82%; 200.7 / 160.9 = 125%. Two combined-ratio points on Japanese premiums: 0.02 x 2,596.3 = ¥51.9bn. Large deals: 94.1 + 473.5 + 215.0 + 898.0 + 356.7 = ¥2,037.3bn. Ignyte and Agrihedge goodwill: 54.5 + 71.8 = 126.3. Distributions since the year to March 2018: 860.6 / 267.6 = 3.2 times. Analysts' target against the price: 8,653 / 7,932 - 1 = 9%. Channel share: 28.5 + 25.0 + 18.4 = 71.9%. Ignyte and Agrihedge prices: 102.8 + 150.0 = 252.8; 10% of that = 25.3. Pure profit growth: 43.2 / 38.0 - 1 = 13.7%. Agency commissions: 19.7% x 2,596.3 = ¥511bn. HCC profit against price: 122.1 / 898.0 = 13.6%. Suncorp against HCC: 14 / 7.5 = 1.9 times. — FY to March 2026 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Tokio Marine's results, presentations and market data; operands shown in the source line.
  3. ReportedThe IFRS figures, which the company now reports, exclude those gains from profit: IFRS net income was ¥531.3 billion against JGAAP's ¥980.4 billion.
    Tokio Marine Holdings, Consolidated Financial Results (IFRS) for the fiscal year ended March 31, 2026 - insurance revenue, net income, segment results, the Japan Life investment loss, acquisitions, the NICO share disposal and the buybacks. — FY to March 2026 · publ. 26 June 2026 · source ↗
  4. ReportedThe IFRS figures, which the company now reports, exclude those gains from profit: IFRS net income was ¥531.3 billion against JGAAP's ¥980.4 billion.
    Tokio Marine Holdings, Consolidated Financial Results (Japanese GAAP) for the fiscal year ended March 31, 2026 - ordinary income, net income, segment profit, dividends, cash flows and securities. — FY to March 2026 · publ. 20 May 2026 · source ↗
  5. ReportedThe company's new adjusted measure, ¥881.5 billion, also excludes all capital gains.
    Tokio Marine Holdings, FY2025 results and FY2026 projections presentation - Japan P&C results: premiums, auto, natural catastrophes and expense ratios. — FY to March 2026 · publ. May 2026 · source ↗
  6. ReportedJapanese GAAP return on equity shows the same inflation: 15.9% in the year to March 2024, 20.6% in 2025 and 18.7% in 2026, against IFRS return on equity of 6.2% and 7.1% for the last two years.
    Tokio Marine Holdings, Consolidated Financial Results (Japanese GAAP) for the fiscal year ended March 31, 2026 - ordinary income, net income, segment profit, dividends, cash flows and securities. — FY to March 2026 · publ. 20 May 2026 · source ↗
  7. ReportedJapanese GAAP return on equity shows the same inflation: 15.9% in the year to March 2024, 20.6% in 2025 and 18.7% in 2026, against IFRS return on equity of 6.2% and 7.1% for the last two years.
    Tokio Marine Holdings, Group Business Strategy IR conference, 26 May 2026 - capital, strategic equities, shareholder returns, the ten-year key statistics and the 2035 aspiration. — 2016-2026 · publ. 26 May 2026 · source ↗
  8. ReportedJapanese GAAP return on equity shows the same inflation: 15.9% in the year to March 2024, 20.6% in 2025 and 18.7% in 2026, against IFRS return on equity of 6.2% and 7.1% for the last two years.
    Tokio Marine Holdings, Consolidated Financial Results (IFRS) for the fiscal year ended March 31, 2026 - insurance revenue, net income, segment results, the Japan Life investment loss, acquisitions, the NICO share disposal and the buybacks. — FY to March 2026 · publ. 26 June 2026 · source ↗
  9. ReportedThe current year's guidance is ¥950.0 billion; growth on that basis is the only kind that lasts.
    Tokio Marine Holdings, Consolidated Financial Results (IFRS) for the three months ended June 30, 2026 - insurance revenue, net income, adjusted net income by segment and the balance sheet. — April-June 2026 · publ. 12 August 2026 · source ↗
Sources
Generated September 24, 2026