Hokuryo Co., Ltd. (1384) Stock Price

Hokuryo is a company primarily engaged in the production and sales of chicken eggs. The company manages the entire process from production to distribution in-house, enabling it to quickly reflect consumer needs in its production. Through this integrated approach, the company is advancing initiatives to enhance food safety.

The company raises chicks from the day-old stage within Hokkaido and ensures food safety through measures such as operating windowless chicken houses, administering Salmonella vaccines, and using plant-based feed. These practices reduce risks associated with Salmonella bacteria and avian influenza.

Hokuryo's eggs are widely used in supermarkets, hotels, and restaurants. The company maintains approximately 2.3 million laying hens in Hokkaido, commanding a high market share in the region. The egg business consists of production, manufacturing, and sales divisions.

In the production division, the company operates rearing farms within Hokkaido to raise its own chicks. Using windowless chicken houses with fully automated management systems, the company achieves stable production environments. Outside Hokkaido, the company operates farms in Iwate and Miyagi prefectures, where it also produces cage-free eggs.

In the manufacturing division, eggs are processed at a GP facility certified with FSSC22000. The company has introduced state-of-the-art equipment and strengthened quality inspection and traceability. The company also manufactures liquid eggs and hot spring eggs, expanding its processed products segment.

In the sales division, the company maintains a high direct sales rate within Hokkaido, selling directly to business partners. The company operates proprietary brands such as "PG Egg Morning" and "Salad Feeling," increasing the sales ratio of specialty eggs. The company is expanding direct sales in the Tohoku region and has begun exporting to the Hong Kong market.

Hokuryo aims for growth in a competitive global market and has adopted a management approach centered on bold, forward-looking change. The company emphasizes understanding domestic and international trends, anticipating the future ten years ahead, and actively pursuing change rather than adhering to past practices.

The company has positioned business expansion as a core growth strategy. In particular, it is expanding sales regions and diversifying sales channels for Eviary eggs to increase sales volume. Additionally, exports of chicken manure to Southeast Asia are progressing steadily.

Hokuryo is also considering business expansion through M&A. The company actively evaluates capital participation and M&A opportunities both domestically and internationally, pursuing scale expansion while assessing business viability. This approach supports sustainable growth.

Strengthening revenue structure is another key strategy. To build a revenue model less dependent on market fluctuations, the company is focusing on producing and expanding sales of value-added eggs. This secures stable revenue and stabilizes management.

Reducing production costs is a priority area. The company is improving egg production performance and reducing costs through renovating chicken houses with the latest technology, improving feed composition, and implementing rigorous biosecurity measures. These efforts enhance competitiveness.

Hokuryo implements thorough avian influenza prevention measures. Learning from past experience, the company invests annually in prevention strategies and strengthens chicken house improvements and biosecurity protocols. This minimizes risk.

The company is also advancing cage-free egg production and sales. As an animal welfare initiative, it is increasing sales volume through diversifying sales channels and expanding commercial applications. This approach meets diverse consumer needs.

Securing human resources is an important challenge. In a tight recruitment environment, the company is working to attract and retain talented employees through diversifying recruitment channels, offering varied employment types, and enhancing employee training programs. These efforts strengthen the organization.