NIPPON STEEL TRADING CORPORATION (E02640) Stock Price

Nippon Steel Trading is a comprehensive trading company that handles sales and import-export of a wide range of products, including steel. As a member of the Nippon Steel Group, the company deals with diverse products such as steel, industrial machinery and infrastructure, food, and textiles both domestically and internationally. The company operates through a group structure that includes 83 subsidiaries and 43 affiliated companies.

The company's revenue is primarily generated from sales and trading operations across various product categories. As part of the Nippon Steel Group, the company maintains a particularly strong customer base in steel-related business and supplies products to a wide range of industries, from manufacturing to construction. The company actively pursues overseas expansion and secures stable revenue from its global trading network.

The company's business is divided into four main segments. The steel business handles steel products and iron ore materials, while the industrial machinery and infrastructure business provides industrial equipment and infrastructure-related facilities. The food business handles procurement and sales of grains and food ingredients, and the textile business deals with apparel and industrial textile products, with each segment leveraging specialized expertise in its respective field.

Nippon Steel Trading has set targets of 420 billion yen in operating profit and approximately 10% return on equity for fiscal year 2023 under its medium- to long-term management plan launched in fiscal 2020. As the core trading company of the Nippon Steel Group, the company is deploying a three-pillar strategy to address structural changes including declining domestic steel demand and intensifying global competition: strengthening its business foundation, advancing growth strategies, and deepening ESG management. In fiscal 2022, the company achieved operating profit of 513 billion yen, significantly exceeding its targets and demonstrating strong earnings capacity.

The company's priority investment focus is on maximizing synergies through integrated operations with Nippon Steel. Following its transition to a Nippon Steel subsidiary in April 2023, the company is pursuing synergies through three pillars: streamlining and strengthening trading functions, enhancing direct sales capabilities through shared sales expertise, and advancing supply chain sophistication. In particular, the company is adopting a strategy to maximize the use of both companies' sales offices and processing facilities such as coil centers to improve its ability to respond to diverse customer needs.

In new market development, the company is prioritizing investments in emerging demand areas such as carbon neutrality and overseas growth markets. The company is capturing expanding global steel product demand centered on Asia and North America by strategically deploying the combined sales capabilities of both companies to strengthen overseas sales operations. The company is also actively pursuing new demand creation in response to societal needs such as the SDGs, aiming to build a sustainable growth foundation.

In technology innovation, the company is advancing supply chain optimization through cutting-edge digital technologies. By sharing sales information with Nippon Steel, the company is linking data on production, inventory, logistics, and delivery schedules to build new business models that achieve optimal inventory levels, shorter lead times, and improved manufacturing efficiency. Looking ahead, the company is also considering strengthened collaboration in new growth areas such as green transformation, seeking to establish competitive advantages in both digitalization and decarbonization.