Sharp makes TSE first tier comeback after 16 months

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TOKYO — Shares in Japanese electronics maker Sharp returned to the first section of the Tokyo Stock Exchange — a major milestone in the turnaround of the business being executed by Taiwanese parent company Hon Hai Precision Industry, better known as Foxconn.

Shares began trading 0.5% or 20 yen higher at 3905 yen on Thursday, but ended the morning session 1.15% or 45 yen lower at 3840 yen.

“We will strive to comply with laws and regulations,” Sharp’s President Tai Jeng-wu said at a news conference in Tokyo, in reference to the series of corporate scandals taking place at Japanese manufacturers in recent months. The company “will aim for dramatic growth as ‘One Sharp,'” he added.

Sharp’s return comes 16 months after it was demoted to the second tier for falling into negative equity for the fiscal year through March 2016, having struggled in its core display devices business.

Sharp was the first major Japanese electronics maker to be bought by a company from elsewhere in Asia.

President Tai, who was brought in from Foxconn, implemented a raft of measures to turn the company around, from cost-cutting and personnel management changes to market expansion. The company expects its bottom line for the current fiscal year to return to profit for the first time in four years.

Investors will be keeping a close eye on whether the momentum can be maintained, especially as the CEO has previously mooted the possibility of becoming company chairman once Sharp had achieved promotion to the first tier.

Stocks listed on the first section of the Tokyo Stock Exchange account for over 90% of the market cap of all the stocks listed. First tier stocks are more liquid, meaning investors can trade them more easily than those on the second tier.