KYOEI STEEL LTD. (5440) Stock Price

Kyoei Steel manufactures and operates three main business segments: domestic steel operations, overseas steel operations, and environmental recycling operations. These businesses are run by the company and its affiliated subsidiaries.

In domestic steel operations, the company melts iron scrap using electric furnaces to manufacture and sell steel materials for civil engineering and construction. Key products include deformed bar steel, structural bar steel, flat steel, angle steel, I-beam steel, threaded rebar (Tafnebar), and billets. The company also engages in the purchase, sale, and transportation of steel products.

In overseas steel operations, the company rolls and shapes semi-finished products from melted and refined iron scrap or semi-finished products purchased externally to manufacture and sell steel materials for civil engineering, construction, and ore crushing applications. Key products include deformed bar steel, threaded rebar, wire rod, round steel for ore crushing, and billets.

In environmental recycling operations, the company provides intermediate and final processing of medical waste and industrial waste. For medical waste treatment, it uses the "Mescude System" for harmless melting and incineration. The company also operates a recycled aggregate business.

Other operations include port services, foundry operations, and insurance agency services. These businesses are managed through related subsidiaries.

Kyoei Steel is committed to contributing to Japan's economic development and regional communities by operating resource-circulation businesses centered on steel manufacturing while coexisting with society. The company prioritizes safety and compliance, and fosters a corporate culture that promotes innovation and transformation as its guiding principles.

In April 2024, the company formulated its medium-term management plan "NeXuS II 2026." Themed around "nexus," meaning connection and collaboration, this plan aims to strengthen partnerships both within and outside the group and enhance value for future generations. Through this initiative, the company seeks to contribute to the realization of a sustainable society.

As a growth strategy, Kyoei Steel is strengthening its steel operations domestically and internationally. In particular, the company is increasing investment in North American operations and restructuring its Vietnam business. Domestically, through the acquisition and merger of Kanto Steel, the company will strengthen collaboration across four business sites and establish a stable earnings foundation.

In the environmental recycling business, the company leverages its integrated strength in steelmaking and waste disposal to expand handling of difficult-to-process waste. By promoting the circular economy, the company contributes to realizing a resource-circulation society and aims for sustainable growth.

Kyoei Steel is strengthening investment in intangible assets to enhance corporate value. Through improving human capital and brand value, the company will increase employee engagement and promote shared understanding of its corporate mission. This reinforces the foundation supporting long-term growth.

The company is advancing ESG management and targeting carbon neutrality by 2050. By fiscal 2030, it plans to reduce CO₂ emissions from domestic production facilities by 50% compared to fiscal 2013 levels. Through initiatives across environmental, social, and governance areas, the company aims to become a sustainable enterprise.

By fiscal 2026, Kyoei Steel targets consolidated net sales of 380 billion yen and consolidated ordinary profit of 25 billion yen. The company also sets targets of ROE of 8.0% or higher and equity ratio of 50% or higher. These goals will establish a stable earnings foundation and strengthen shareholder returns.

To realize management that is conscious of capital costs and stock price, the company prioritizes restructuring its overseas steel operations as its top priority. Aiming to achieve ROE of 8.0% or higher, the company will increase its dividend payout ratio to 30-35%, strengthening shareholder returns and improving PBR.