Hedge fund Elliott disclosed a position in Da Jin Industrial, causing the stock price to soar 14%, the largest increase since 2009.

Japanese air conditioning giant Daikin Industries faced strong buying pressure on the Tokyo stock market, with its stock price soaring 14% in early trading on Thursday, marking the largest intraday gain since 2009. The direct cause of this stock price fluctuation was the announcement by the globally renowned activist hedge fund Elliott Investment Management that it had acquired approximately 3% of the company's shares. This move immediately sparked expectations in the market for this global air conditioning leader to initiate major capital efficiency reforms under external pressure, with investors generally optimistic about Daikin unlocking its potential market value. In a subsequent official statement, Elliott bluntly pointed out that as the absolute leader in the global HVAC industry, Daikin's current financial performance and potential for growth have not been fully reflected in the capital markets, even being severely undervalued in the long term. The institution believes that Daikin has a high level of competitive barriers in international markets, but there is still significant room for improvement in profit margins. As a result, Elliott not only called on Daikin management to take more targeted measures to expand margins, but also explicitly recommended the company to reassess its existing asset portfolio by divesting non-core businesses to further focus on its core business. Regarding shareholder returns, Elliott's stance is particularly strong. The fund detailed that Daikin Industries has a strong balance sheet, fully capable of allocating up to 1 trillion yen (approximately 6.3 billion USD) for share buybacks in future midterm development plans to significantly enhance earnings per share and reward investors. Elliott emphasized that they will actively engage in the process of formulating Daikin's upcoming mid-term management plan to ensure that the company's strategy can effectively narrow the valuation gap with global industry peers. Daikin Industries' inclusion in Elliott's investment list is not an isolated market event, but rather an extension of Elliott's recent heavy positions in the Japanese market. With the Japanese government and the Tokyo Stock Exchange continuously urging local companies to improve corporate governance, Elliott has already established positions in several blue-chip companies such as Tokyo Gas, Kansai Electric Power, SoftBank Group, and Sumitomo Corporation, frequently pressuring management to sell redundant assets or increase dividends. It is worth noting that Elliott had recently successfully pushed Toyota Group to raise its offer price for Toyota Industries Corporation and quickly accelerated its presence in Japan. Last month, the investment company announced its stake in shipping company Mitsui O.S.K. Lines, reflecting the increasing focus of aggressive investors in the Japanese corporate sector, amid growing pressures for companies to prioritize shareholder returns. Analyst Satoshi Tanaka of SMBC Nikko Securities wrote in a report, "We believe that there is a need to strengthen interaction with the capital markets, and Elliott's investment should help in encouraging investors to reassess this stock." A representative from Daikin confirmed Elliott's investment but declined to comment. Previously, due to uncertainty over US tariff policies, Daikin had lowered its annual profit forecast in February, leading to a single-day drop of 6.5% in its stock price, but gradually recovering afterward. At the time, the company stated that the reevaluation of tariff measures would reduce operating profits by approximately 41 billion yen (approximately 258 million USD) for the fiscal year ending in March, and plans to offset the impact through price increases and cost reductions. Looking ahead, industry research shows that data center cooling demand will become a core driver of growth for Daikin's US business. The company aims to triple its North American data center revenue by the fiscal year ending in March 2031, reaching at least 300 billion yen. Currently, all eyes are on Daikin Industries' upcoming financial report and strategic plan to be released on May 12, with management's response to Elliott's proposals determining whether the stock price can maintain its current upward momentum.