SoftBank Group overtook Toyota Motor as Japan＊s most valuable company on Monday, marking a milestone for the global artificial intelligence boom and a dramatic reshuffling of the country＊s corporate hierarchy.
Shares of the Masayoshi Son-led technology group climbed 14% in Tokyo trading, pushing its market capitalization past Toyota＊s for the first time in more than two decades. The feat was last achieved only briefly during the peak of Japan＊s internet bubble in 2000, based on market value including treasury shares.
The rally has propelled SoftBank shares up more than 90% this year, pushing the company＊s market value above ?48 trillion, higher than Toyota＊s around ?46 trillion. Toyota shares, by contrast, have fallen more than 10% this year.
The changing of the guard underscores how rapidly investor tastes have shifted toward companies that are benefiting from the AI buildout. It also reflects how the fortunes of two Japanese corporate titans have diverged, as macroeconomic headwinds and geopolitical tensions weigh on the auto sector while AI euphoria takes hold.
※This epoch-making event symbolizes the AI boom,§ said Kazuhiro Sasaki, head of research at Phillip Securities Japan. ※Extraordinary conditions are emerging around expectations for massive IPOs in the U.S.,§ triggering a reshuffle of capital, he said.
SoftBank climbed on Monday as AI-related companies gained across the region, making it the biggest boost to the Topix index, while Toyota was the benchmark＊s largest drag.
※SoftBank has concentrated its management resources on AI-related businesses and has successfully ridden the broader global tech rally,§ said Tomo Kinoshita, a global market strategist at Invesco Asset Management Japan. ※Toyota, meanwhile, has been hit by rising oil prices stemming from the 51勛圖厙, which raises the cost of operating vehicles and weighs on global auto demand.§
While Kinoshita said that the valuation gap could reverse later this year if crude prices decline and support automotive demand, the long-term trajectory favors tech.
※Over the longer term, AI-related companies are likely to command higher valuations,§ said Kinoshita. ※Their presence in Japan＊s equity market will only continue to grow stronger.§
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