UPDATE 2-Nissan echoes cautious outlook; eyes Micra boost

* Q4 op profit Y82.7 bln vs consensus Y90 bln

* Sees 2010/11 op profit up 12 pct to Y350 bln, below mkt

* CEO Ghosn wants to start new mid-term plan in 2011

* Shares end up 1.1 pct before results, lag sector YTD

(Recasts, adds fund manager comment, detail, graphic)

By Chang-Ran Kim, Asia autos correspondent

YOKOHAMA, Japan, May 12 (BestGrowthStock) – Nissan Motor Co (7201.T: )
expects growth in emerging markets and launches of new models
such as its Micra compact to provide only a modest boost to
profits this year, a cautious view echoing its larger Japanese
rivals.

While top ranked Toyota Motor Corp (7203.T: ) and No.2 Honda
Motor Co (7267.T: ) have benefited from their lead in
fuel-efficient hybrid models in mature markets, Nissan has grown
faster in China where drivers still prefer cheap, conventional
cars.

Last year, Nissan’s sales shot up 45 percent in China, the
world’s biggest auto market, making it the best performer among
Japanese automakers.

However, a lack of hybrid offerings and increasing
competition looked set to weigh on Japan’s No.3 automaker, said
Koichi Ogawa, chief portfolio manager at Daiwa SB Investments.

“In comparison to the past, Nissan did pretty well. That’s
mainly because it was strong in China and emerging markets,
especially over this past year,” said Ogawa, who described the
outlook as unsatisfying.

“It’s done quite well up to now considering it doesn’t have
any hybrids, but competition is likely to get tougher now and
it’ll take some time before its electric car is ready.”

After trailing Toyota and Honda in environmentally friendly
technology, Nissan is looking to rebrand itself as a “green”
automaker by becoming the first to market electric cars in big
volumes from 2012 along with partner Renault SA (RENA.PA: ).

Renault-Nissan Chief Executive Carlos Ghosn has been the
industry’s most aggressive proponent of electric vehicles and has
said he expects one in every 10 new cars sold globally to be
battery-run by 2020.
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For graphic on earnings: http://link.reuters.com/nyd73k
For graphic on sales by region: http://link.reuters.com/mad73k
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CONSERVATIVE FORECASTS

For the year to March 31, 2011, Nissan forecast an operating
profit of 350 billion yen ($3.78 billion), up 12 percent from the
311.6 billion yen it made last year but lagging a consensus
forecast of 411 billion yen in a poll of 22 analysts by Thomson
Reuters I/B/E/S.

It expects net profit to more than treble to 150 billion yen
and global sales to grow about 8 percent to 3.8 million vehicles.

Japanese automakers are often conservative in their profit
forecasts, particularly early in the year. Toyota on Tuesday
projected an 80 percent rise in 2010/2011 operating profit to 280
billion yen, but that was little more than half what analysts
were expecting. [ID:nTOE64902V]

Honda last month said it expected operating profit to rise 10
percent to 400 billion yen, 20 percent below consensus.
[ID:nTOE63Q04N]

Nissan’s operating profit in the final, January-March quarter
was 82.7 billion yen, compared with a loss of 230.4 billion yen a
year earlier, when the economic crisis hammered sales, forcing
the industry to scale back production.

The result was in line with the consensus estimate of 90
billion yen. Nissan posted a fourth-quarter net loss of 11.6
billion yen versus a loss of 276.9 billion yen a year ago.

This year, Nissan is looking to gain a foothold in India,
another promising battleground for global automakers. Nissan will
begin production in India for the first time, starting with the
Micra hatchback later this month.

The Micra, called March in some markets, is Nissan’s most
important model in years and its main hope for expanding sales in
emerging and developed markets alike.

SEEN THE WORST

But the removal of government stimulus measures, Europe’s
debt woes and related strength in the yen, along with the
expensive bets on new, more environmentally friendly technology
have prompted caution among many automakers.

Ghosn said the problems stemming from Greece’s funding
shortfall were unlikely to require any downward revision to
Nissan’s already weak forecast for the European market.

“We know the worst of the crisis is behind us and our plan of
action is to emerge from the crisis completely in this fiscal
year and start a new mid-term plan in fiscal year 2011,” Ghosn
told a news conference.

Shares in Nissan have lost around 7 percent in the year to
date, about double the fall in Tokyo’s transport sector subindex
(.ITEQP.T: ).

Before the results, Nissan ended up 1.1 percent at 745 yen,
while the transport sector rose 1.6 percent.

Stock Market

(Additional reporting by Elaine Lies; Writing by Lincoln Feast;
Editing by Joseph Radford)

UPDATE 2-Nissan echoes cautious outlook; eyes Micra boost