Mitsubishi Corp.

The stable outlook reflects our view that the company's capital adequacy will steadily improve in the next year or two. We base this view on our expectation that despite more spending, the company will accumulate shareholders' equity through the steady retention of net profits and uphold a conservative investment policy. The outlook also reflects our expectation that Mitsubishi Corp. will achieve a steady return on risk-weighted assets (RORA) of around 15%. We will consider an upgrade if profits and profitability from resource and nonresource businesses continue to grow, steadily pushing Mitsubishi Corp.'s RORA beyond 20%. Additionally, we may upgrade the company if its net profit and shareholders' equity improve faster than we assume and we determine that its adjusted capital

...Based on the well-diversified, strong business portfolio, Mitsubishi Corp. will likely continue to generate strong profits. S&P Global Ratings expects net profits of Japan-based general trading and investment company (GTIC) Mitsubishi Corp. to steadily increase in the next one or two years. They stood at around Ñ600 billion in fiscal 2018. We expect the increase to be driven by steady profit contributions, mainly from nonresource businesses including food and other living essentials, automotive, and infrastructure. Mitsubishi Corp. has continuously strengthened its business portfolio, mainly in nonresource sectors. Thus, we believe the company has become less susceptible to external factors and resource prices. Some of the company's businesses, including convenience store Lawson Inc., face increasingly harsh competition. Mitsubishi Corp. is likely to continue to experience difficulties in identifying new investment opportunities that will lead to long-term profit contributions. However,...

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