It has been seven years since the Abe administration's economic stimulus was launched. The Nikkei Stock Average has more than doubled in price since “Abenomics” started late in 2012. But, as is often the case when the market rises, not every company has benefitted from the surge that has taken place over this period. As Chart 1 shows, there have been obvious winners under Abenomics (e.g. Sony) and those that could be called losers (e.g. Panasonic)—which raises the question, how did the fortunes of these companies come to diverge so clearly?

Chart 1: Fortunes of Sony, Panasonic have diverged under Abenomics

Source: Bloomberg

Initial phase: Rising in tandem (early 2013–spring 2015)

  • Both Sony and Panasonic come under new management and undertake bold restructuring
  • Sony, Panasonic share prices each gain 2.5 times during this phase as financial markets applaud steps taken by the firms

In the initial phase of Abenomics, the two companies traced a similar path, as Chart 1 shows. The share prices of both Sony and Panasonic surged during this period, more than doubling at about the same rate. This is explained by the market’s positive reaction to the massive restructuring both companies initiated under new management in a bid to reform. For example, Sony sold its Vaio personal computer business, departing with a product long associated with the company. Panasonic, for its part, liquidated its massive plasma display-manufacturing plants.