(Bloomberg) -- It’s not quite a sugar rush, but a plan to raise ice cream prices in Japan is boosting hopes for investors in food company stocks, and may satisfy the cravings of government officials.
Lotte Holdings Co. announced this week it will increase the prices of more than half of its ice cream products. That was followed by seasoning maker and food company Ajinomoto Co.’s plans Thursday to raise prices on its frozen-food products.
The news bolstered shares of Japanese dairy and snack purveyors on speculation other companies will follow suit. Morinaga Milk Industry Co., Meiji Holdings Co., and Megmilk Snow Brand Co. all rose more than 4 percent in early Tokyo trading Friday.
“The decision by the top firm in the ice cream industry to hike prices makes it easy for others to follow,” SMBC Nikko analyst Naomi Takagi wrote in a note to investors Thursday.
The increases, which were the result of higher manufacturing costs, may also be good news for the Bank of Japan. Central bank Governor Haruhiko Kuroda has been frustrated by companies’ reluctance to raise prices, with inflation at only half the pace targeted by the BOJ.
--With assistance from Yuko Takeo.
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