ENVALITH
中部飼料株式会社 logo

CHUBUSHIRYO CO.,LTD.

2053・Prime Market・Foods

Official website
中部飼料株式会社 logo
CHUBUSHIRYO CO.,LTD.2053

Business

Chubu Feed Co., Ltd. is an independent, comprehensive compound feed manufacturer founded in 1949, listed on the Prime and Premier markets of the Tokyo and Nagoya Stock Exchanges. The company consists of two core pillars: the "Feed Segment" (net sales of ¥191,181 million), which mainly manufactures and sells compound feed for chickens, pigs, cattle, and fish, and the "Other Segment" (net sales of ¥20,633 million), which encompasses sales of specialty eggs such as "Goma Tamago" (sesame egg), organic-blended compound fertilizer, livestock equipment, and insurance agency operations. The company operates plants nationwide in Hachinohe, Chita, Kashima, Hokkaido, Kushiro, Shibushi, Mizushima, and Shizuoka, with in-house integrated production as a key strength. Through a capital and business alliance with Nippon Ham Co., Ltd. (concluded in 2015), the company has built a system for joint development and stable supply of differentiated feed products. Its principal customers are domestic livestock and fisheries farmers and food manufacturers.

Business Model

Manufactures compound feed at its own plants, relying on imported grains for over 90% of raw materials, and sells the product to livestock and fisheries farmers. The key to profitability lies in managing the 'raw material position' (the spread between feed sales prices and raw material costs), with margins adjusted through a quarterly price revision system and reviews of feed formulation design. Value-added product lines such as differentiated feeds, specialty eggs, and organic fertilizers form a complementary structure that adds depth to earnings.

Company Strengths

The company owns its own plants in Hachinohe, Chita, Kashima, Hokkaido, Kushiro, Shibushi, Mizushima, and Shizuoka, and has obtained Category 1 authorized factory approval from the customs offices with jurisdiction over each plant. The stable supply system leveraging its integrated in-house production facilities forms the foundation of long-term trust relationships with customers, and feed production volume reached ¥186,455 million in FY2026 (ending March 2026).

The company owns proprietary research facilities such as the Oita Experimental Station (with ¥535 million invested in aquaculture research equipment) and the Kamo Research Institute (swine and cattle farming), staffed by 39 specialized researchers. R&D expenses for FY2026 (ending March 2026) totaled ¥834 million. The company has achieved concrete commercialization results, including improved feed conversion ratios through the use of digestive enzymes, new products for greenhouse gas reduction-effect feed, and improved palatability of low-fishmeal feed.

In 2015, the company concluded a capital and business alliance agreement with Nippon Ham Co., Ltd. It has been advancing the establishment of a stable feed supply system for the Nippon Ham group, joint development of differentiated feed for branded meat products, and enhanced meat traceability tracing back to feed. Maintaining neutrality as an independent manufacturer while building a cooperative relationship with a major food manufacturer is a unique strength that would be difficult for competitors to replicate in a short period.

ENVALITH's Perspective

For FY2026 (ending March 2026), operating profit was ¥6,584 million (up 53.8% year on year) and profit attributable to owners of parent was ¥5,551 million (up 58.5% year on year), marking three consecutive years of profit growth and a record high for the first time in six periods. Cost of sales decreased from ¥191,246 million in the previous period to ¥190,049 million, while net sales increased, improving the gross profit margin. However, as external factors, risks that rising corn prices from summer onward and the rapid yen depreciation from autumn onward could again squeeze profitability continue, and it should be noted that FY2027 (ending March 2027) is forecast to see a decline in operating profit to ¥5,900 million (down 10.4% year on year).

As a subsequent event, the company plans to sell a logistics warehouse rental property in Yokohama on April 30, 2026, and record a gain on sale of fixed assets of approximately ¥3,100 million as extraordinary income in the first quarter of FY2027 (ending March 2027). This is the main factor boosting the FY2027 profit attributable to owners of parent forecast of ¥6,900 million (up 24.3% year on year), while ordinary profit is expected to decline 13.5% year on year to ¥6,200 million, indicating a decrease in underlying earnings on a real-terms basis. Investors need to scrutinize the underlying earnings power excluding the one-time gain.

For FY2026 (ending March 2026), selling, general and administrative expenses were ¥15,181 million, an increase of ¥872 million from ¥14,309 million in the previous period. The per-unit burden of the feed price stabilization fund contribution remains at an elevated level and is expected to continue into FY2027 (ending March 2027). In addition, rising energy costs due to escalating tensions in the Middle East, cost increases associated with inflation, and increased depreciation expenses from active capital investment are compounding, leading to forecasts of declining operating profit and ordinary profit year on year. These represent a combination of external factors and structural cost increases, and the sustainability of profit margin improvement needs to be carefully assessed.

Growth Strategy

Under Medium-Term Management Plan 2024, the company is advancing three pillars: improving profitability of the Feed segment, accelerating growth in Other segment businesses, and promoting sustainability management.

The company is promoting new product development and upgrades to existing products utilizing its swine, cattle, and aquaculture research facilities, increasing the ratio of differentiated and environmentally friendly feed, expanding sales of low fish-meal aquaculture feed, and improving profitability using an ROIC tree. In FY2026 (ended March 2026), segment profit rose substantially to ¥6,486 million (up 63.9% year on year).

The company is strengthening sales of specialty eggs such as "Goma Tamago" in its egg sales business, expanding sales of organic-blended fertilizer using compost, and reinforcing sales of livestock equipment for overseas markets along with new product lines. In FY2026 (ended March 2026), net sales increased to ¥20,633 million (up 11.9% year on year), but segment profit declined to ¥1,214 million (down 13.6% year on year) due to a decline in the profit margin of livestock equipment, which remains a challenge.

The company is phasing in increases to its dividend on equity ratio (DOE), targeting a DOE of 3% or higher in FY2027 (ending March 2027). Annual dividends of ¥65 per share (DOE of 2.7%) are planned for FY2026 (ended March 2026), and ¥76 per share (DOE target of approximately 3%) for FY2027. In addition, share buybacks of ¥1,500 million are being conducted to improve capital efficiency.

With the aim of effective utilization of management resources and improved asset efficiency, the company sold a leased logistics warehouse property in Yokohama City, with the transfer completed on April 30, 2026. An extraordinary gain of approximately ¥3,100 million from the sale of fixed assets is expected to be recorded in the first quarter of FY2027 (ending March 2027). The gain is expected to contribute to a 24.3% year-on-year increase in profit attributable to owners of parent (to ¥6,900 million).

As part of its continued ESG initiatives, the company supports its earnings base through greenhouse gas reduction, active investment in human capital, and improved effectiveness of the Board of Directors and risk management. This is positioned as one of the three pillars of Medium-Term Management Plan 2024.

Last updated: July 19, 2026