RS Technologies Co., Ltd.

Business Details

A business that receives used monitor wafers from the semiconductor manufacturing process and reclaims them to near-new quality through processes such as stripping/etching, polishing, cleaning, and inspection. Operated across three sites in Japan (Sannohe Plant), Taiwan (Tainan Plant), and China, serving global semiconductor manufacturing companies including major foundries such as TSMC. A single wafer can be reclaimed 10 to 20 times, making this a high-value-added service that contributes to customer cost reduction. Also includes the Silicon Wafer Sales Business and the Oxide Film Deposition Processing Service Business.

Recent Overview

In Q1 FY2026 (ending March 2026), both sales and profit increased year on year, showing strong performance.

In the first quarter of FY2026 (ending March 2026), the Wafer Reclaim Business segment's external customer sales were ¥7,038 million (up 6.4% year on year), and segment profit was ¥2,710 million (up 14.0% year on year). Processing of customer-provided materials (reclaim processing service) increased 12.8% year on year to ¥4,752 million, driving revenue growth. Sales of goods decreased 4.7% year on year to ¥2,285 million. Intersegment sales (transfers) were zero, with all sales attributable to external customers.

Key Products

Growth Drivers

• Increasing demand for monitor wafer reclaiming driven by the expansion of demand for high-performance semiconductors amid the spread of generative AI
• Expansion of production capacity and market share through capacity-expansion capital investment at the Sannohe Plant (Japan) and Tainan Plant (Taiwan)
• Deepening business relationships with major foundries such as TSMC
• Enhanced value-added offerings through advancement of reclaim technology for high-end 12-inch (300mm) wafers
• Capturing global customer demand through the three-site structure in Japan, Taiwan, and China

Risks

• Fluctuations in semiconductor market demand (risk of reduced reclaim demand during economic downturns or capital expenditure restraint)
• Increased costs to meet demands for more advanced reclaim technology as semiconductor miniaturization progresses
• Growing uncertainty in the trade and investment environment due to U.S. additional tariffs and other protectionist policies
• Risk of revenue concentration among major customers (such as TSMC)
• Downward pressure on profit margins from rising depreciation expenses associated with increased capital investment

Business Details

Operated mainly by GRINM Semiconductor Materials Co., Ltd. and Shandong GRINM Semiconductor Materials Co., Ltd., this business manufactures and sells prime silicon wafers primarily in 5-inch (125mm), 6-inch (150mm), and 8-inch (200mm) sizes for semiconductor manufacturers in China. Prime silicon wafers are the substrate material that becomes finished IC chips, and the company entered this business through Beijing GRINM-RS Semiconductor Materials Co., Ltd., a joint venture established in 2018. The business also handles new monitor wafers, dummy wafers, and silicon ingots.

Recent Overview

In Q1 FY2026 (ending March 2026), both sales and profit increased significantly year on year

In the first quarter of FY2026 (ending March 2026), the Prime Silicon Wafer Manufacturing and Sales Business segment's external customer sales were ¥5,784 million (up 28.8% year on year from ¥4,491 million), and segment operating profit was ¥1,329 million (up 21.9% year on year from ¥1,090 million), achieving substantial growth in both revenue and profit. Intersegment sales also expanded to ¥568 million (from ¥323 million in the same period of the prior year), reflecting diversification of sales channels. Sales of goods grew substantially year on year to ¥5,784 million.

Key Products

Growth Drivers

• Increasing demand for prime wafers driven by expanded capital investment by semiconductor manufacturers in China
• Continued expansion of revenue scale through steady increases in production volume
• Potential for market share expansion through establishment of world-standard crystal technology for 8-inch wafers
• Development of new markets through establishment of mass production capability for 12-inch prime silicon wafers
• Diversification of sales channels, including intersegment sales (¥568 million in Q1 FY2026, ending March 2026)

Risks

• Risk of sustained decline in average selling prices due to intensifying competition in the Chinese market
• Risk of missing market share expansion opportunities due to delays in establishing crystal technology
• Uncertainty in semiconductor demand from China due to U.S. additional tariffs and other protectionist policies
• Difficulty securing specialized personnel with prime silicon wafer industry experience
• Increased fixed cost burden from rising depreciation expenses (¥2,039 million for full year FY2025, ended March 2025)

Business Details

This segment encompasses the manufacture and sale of consumable parts for semiconductor manufacturing equipment by DG Technologies, the sale of electronic components and semiconductor manufacturing equipment by Union Electronics, the manufacture and sale of electrolyte solution for storage batteries by LE System, and the manufacture and sale of optical pickups and in-vehicle camera modules by AAC Optics (Huizhou) Co., Ltd. Major customers include Sony Semiconductor Solutions Corporation, with sales primarily deployed globally, centered on the Chinese market.

Recent Overview

In Q1 FY2026 (ending March 2026), sales declined slightly but operating profit improved substantially

In the first quarter of FY2026 (ending March 2026) (January to March 2026), the Semiconductor-Related Equipment & Components, etc. segment's external customer sales were ¥6,295 million (compared to ¥6,463 million in the same period of the prior year, down 2.6% year on year), a slight decrease. Meanwhile, segment operating profit improved substantially to ¥240 million (from ¥8 million in the same period of the prior year). Intersegment sales of ¥88 million were also recorded, compared to zero in the same period of the prior year, indicating expansion of intragroup transactions.

Key Products

Growth Drivers

• Full-scale contribution of optical pickup sales through the consolidation of AAC Optics (Huizhou) Co., Ltd. (the main driver of the 85.7% year-on-year increase in sales for the full prior fiscal year)
• Continued recording of large-scale sales through transactions with Sony Semiconductor Solutions Corporation
• Explicit designation of strengthening sales of semiconductor-related equipment and components as a management priority, driving global sales expansion
• Diversification of revenue sources through establishing an overseas production framework for the electrolyte solution for storage batteries business and developing renewable energy operations in China
• Signs of improved profitability, with operating profit substantially improving year on year in Q1 FY2026, ending March 2026 (from ¥8 million to ¥240 million)

Risks

• High dependence on sales to the Chinese market, creating demand volatility risk from U.S.-China trade friction, additional tariffs, and other protectionist policies
• The stabilization of business profitability at AAC Optics (Huizhou) Co., Ltd. may continue to require time
• Risk of increased complexity in business operations and governance due to the transfer of 70% of DG Technologies' shares to GRINM Semiconductor Materials Co., Ltd.
• Risk of demand fluctuation from intensifying competition and technological change in the optical pickup market
• New businesses such as electrolyte solution for storage batteries and renewable energy are at a launch stage, with uncertain timeframes and costs to profitability
• Risk of slowing sales growth, as external customer sales in Q1 FY2026 (ending March 2026) declined slightly year on year

Business Details

The "Other" segment consists of the Solar Business, which sells electricity generated by photovoltaic power systems installed on the grounds of the Sannohe and Tainan Plants, and the Technical Consulting Business, which provides technical guidance and education services related to the semiconductor wafer manufacturing process. In the first quarter of FY2026 (ending March 2026), external customer sales were ¥34 million (¥46 million including intersegment transfers), an extremely small scale, positioning this segment as a supplementary part of the overall consolidated group.

Recent Overview

External customer sales declined year on year, and segment loss also widened.

In the first quarter of FY2026 (ending March 2026), the "Other" segment's external customer sales were ¥34 million, down from ¥49 million in the same period of the prior year. The figure including intersegment transfers also contracted to ¥46 million (from ¥49 million in the same period of the prior year). Segment loss widened to ¥7 million (from a loss of ¥4 million in the same period of the prior year), as the burden of fixed costs within this small-scale group of businesses continues to weigh on profitability.

Key Products

Growth Drivers

• Accumulation of electricity sales revenue through continued operation of photovoltaic power generation systems
• Future revenue contribution from the launch of renewable energy subsidiaries in China (AS Energy (Shandong) and AS Energy Technology (Panzhihua))
• Potential expansion of demand for technical consulting services associated with technological advancement in the semiconductor industry

Risks

• Given the segment's extremely small scale (external sales of ¥34 million), increases in fixed costs and depreciation expenses directly translate into operating losses
• The renewable energy business in China is at a launch stage, with an unclear timeframe and scale to profitability
• The Solar Business carries risk of revenue being affected by external factors such as weather and sunlight conditions
• External sales have been on a declining trend year on year, and the segment loss is widening