Makoto Inoue: Well, pipeline. Well, we have more than ¥2 trillion if we include all the good and bad things. And if we are selective, this is a number that we’re talking about. And then out of that, after buying can you increase the value? And can we do the capital recycling and liquidate. And also, how can we capitalize the ORIX network. We have to look at all of this and then it would be basically about 50%. There are many inquiries, but it’s becoming more and more competitive as well. And we don’t buy at high price. So we have to be very carefully looking at these different deals. One good example of this is Santoku Senpaku. In the beginning from the sellers’ perspective — we’re basically out of the question, but they changed their minds and they wanted to do with us.
So we cannot say exactly how much, but we could purchase them at a very competitive rate. So there’s inquiries as pipeline, can we really buy at a good purchase price? And then can we really increase the value after the investment. So we have to be very discerning in all of these perspectives, which means that we cannot really process a large volume. But there’s a lot in our pipeline, and we have sufficient projects that we can do. But of course, we have to be selective in terms of what deals we can do because it’s a competitive landscape and this stance has not really changed from before. I hope that answers your question.
Koichi Niwa: Yes, thank you for the details. Now I would like to ask you about lifestyle and also bank low profitability businesses. And in the presentation, this time around, you talked about small upside of Japanese economy. That was my understanding, which means that for these businesses in terms of facility expansion, maybe there’s no more room. Is that the correct understanding? Or once the monetary policy changes, should you continue to hold these businesses as core businesses because the profitability will change. The monetary situation is changing. So I would like to understand your position, you stance about bank and insurance.
Makoto Inoue: Yes, for life insurance and bank, it’s true that the profitability is low. In order to increase the profitability, we are pressuring these teams. If the interest rate goes up, our embedded value of life insurance company will increase. And then we will have maybe sufficient price to sell. If that is the case, we will not hesitate to sell. And this has been my policy over the last several years, it has not changed. And the same story with the bank, we are asking the bank to increase the profitability. Compared to other businesses, ROA seems to be good. But if we want to sell the bank, we can only sell at PBR of 0.7 times. We’re not that desperate. So we only sell if the price is right. So same thinking as credit. If we have the buyer and the offer is attractive for us, then we will sell at that attractive price. So the policy is still unchanged.
Koichi Niwa: Thank you. In order to increase ROE I think what to do with this business is a big thing for ORIX. But still, you want to maximize the value that is more important for us. Is that correct?
Makoto Inoue: Well, bank and life insurance, 0.5, 0.6 at this level, I don’t think there’s an advantage for us to sell. That is our assessment it has to be sold at the right price. You may be dissatisfied but ROE is 9% with ORIX and we are approaching exceeding 10%. So we want to pursue ways to maximize the value. That is the current direction of ORIX. I hope you understand.
Koichi Niwa: Thank you very much for your detailed expression. That was very informative.
Hitomaro Yano: Thank you for the questions. And with this, we’d like to conclude the Q&A session. And I’d like to ask Mr. Inoue to provide us with the closing remarks.
Makoto Inoue: Well, this year, 2024 March end, the numbers were pretty good. As we have announced, but it is not to our full satisfaction, ¥390 billion, ¥400 billion and also ROE of 10%, 11% must be achieved. And it will require a strenuous effort in order to achieve those goals. So we will continue to seek for your support. And of course, during this time, of course, we would enhance the payout ratio so that we’ll be able to align ourselves with your expectations. And this is how we are going to be managing this business forward. So please continue to support us.
Hitomaro Yano: So with this, I’d like to conclude our FY 2024 March end briefing session. Thank you very much for your participation. And please disconnect.
