KYOWA CO.,LTD. (E01399) Stock Price

Kyowa is a manufacturing company specializing in surface treatment processing for metal and plastic components. The company accepts orders for automotive parts, digital appliances, and building materials from manufacturers, providing end-to-end services from mold design and casting/molding to surface treatment. The company's core competency is "plating," a surface treatment technology that enhances product durability and appearance quality.

The company's primary customers are manufacturers in the automotive parts, digital appliances, and building materials sectors. It generates revenue by accepting component production orders from these companies and applying surface treatments to both in-house manufactured materials and externally sourced materials. In addition to domestic operations, the company conducts business in the Southeast Asian market through subsidiaries in Singapore and Malaysia.

The business is divided into two segments: "Plating Operations" and "Other Operations." The core plating operations manufacture plated and plastic products across three domestic and international locations. Other operations handle die-casting products and mold manufacturing, where molten metal is poured into molds; all of these products are manufactured domestically.

Kyowa operates as a contract manufacturing company with plating technology as its core competency. The company is pursuing a growth strategy based on an integrated production system spanning from mold manufacturing, material processing, surface treatment, to assembly. Despite challenging business conditions caused by the COVID-19 pandemic, Kyowa is focused on productivity improvements by leveraging the distinctive capabilities of its two primary production lines: the PL plating line and the PC plating line. The company has established a clear vision to become a global enterprise through strengthened collaboration with its overseas subsidiary group.

In priority investment areas, plating technology is positioned as the core differentiator. Beyond improving efficiency in the existing two plating lines, the company is also exploring effective utilization of the former M plating line. Kyowa leverages its long-accumulated plating technology as a source of competitive advantage, delivering added value to customers through surface treatment processing for metal and plastic components. Building on this technical strength, the company is expanding orders across diverse sectors ranging from automotive parts to building materials.

For new market development, the company is focusing on expanding sales to home improvement retailers as a third pillar of domestic business. Following its traditional plating and aluminum die-casting operations, the company is accelerating entry into the general consumer market as a new revenue stream. This initiative diversifies the business portfolio, which has historically centered on manufacturing, thereby reducing exposure to economic cyclicality.

Regarding overseas expansion, the company is carefully monitoring COVID-19 impacts in Southeast Asia and China while working to improve subsidiary performance. Kyowa is pursuing a realistic approach that includes restructuring options, aiming to enhance profitability of overseas operations while maintaining balance between global expansion and earnings. This flexible management approach strengthens the company's adaptability to changing market conditions.