TOKYO (Reuters) - Nintendo Co Ltd roared past Canon Inc to become Japan’s second most valuable tradable company behind Toyota Motor Corp this week as investors bet demand for its Wii and DS machines will remain strong into the critical year-end shopping season.
Although the market value of Mitsubishi UFJ Financial Group Inc (MUFG) is potentially bigger than that of Nintendo, trading in its shares is suspended this week ahead of a 1,000-for-one share split.
Nintendo’s Wii has so far outsold Sony’s PlayStation 3 by a large margin since their launches late last year as Nintendo’s strategy to expand the gaming population by offering easy-to-play but innovative games has proved a big success.
“At the Tokyo Game Show last week, Nintendo wasn’t there officially. But there were a lot of software companies who are dedicating software to Nintendo platforms,” KBC Securities analyst Hiroshi Kamide said.
“I think it’s reasonable to think that this Christmas Nintendo strategy of catering to both core and casual gaming markets will succeed again.” Shares in Nintendo closed up 3.1 percent at 59,200 yen on Tuesday, bringing its market value to 8.39 trillion yen (36.4 billion pounds), surpassing Canon’s market capitalisation of 8.12 trillion yen.
It, however, is still just one-third of Toyota’s 24 trillion yen. Toyota is the world’s most profitable and valuable automaker.
Last Friday, which was the last trading day for MUFG shares ahead of the suspension, market capitalisation for Japan’s largest bank came to 11 trillion yen.
Nintendo shares have more than quadrupled over the past two years, initially boosted by strong demand for the DS, then by brisk sales of the Wii.
In the April-June quarter, Nintendo sold 3.43 million units of the Wii and 6.98 million of the DS. By comparison, Sony sold 710,000 units of its PS3 and 2.14 million of the PlayStation Portable.