Autos/Auto Parts/Tires Sector: Feedback from investor meetings in Asia: Possible signs of a shift in sentiment

We met with around 40 investors in Hong Kong and Singapore over the five days spanning October 19-23. We rarely issue memos about our investor meetings, but this time we sensed a shift in investor sentiment. Signs that sentiment toward the autos sector is bottoming out: although the external environment remains tough, with AI-related stocks now performing poorly, investors are starting to view the autos sector as the final laggard among cyclical value sectors. Investor positioning is heavily weighted toward Honda Motor, as many investors look ahead to 2Q earnings season in search of the next safe haven. We sensed no significant pushback to our Overweight stance on Toyota Motor (target price ¥3,900), based on the potential in 2H for a return to full production of the RAV4, the announcement of a new medium-term plan, and humanoid robots as an investment theme, though expectations for the MTP appear quite low. The outlook for midsized automakers (Subaru, Mazda, Mitsubishi Motors) is gener