NIPPON FELT CO.,LTD..
3512・Standard Market・Textiles & Apparels
Business
Nippon Felt Co., Ltd. was founded in 1917 as a specialized manufacturer of papermaking felt and is listed on the Tokyo Stock Exchange Standard Market. The corporate group consists of Nippon Felt itself and five subsidiaries (Higashiyama Felt, Nip Hosei, Taiwan Huierde Co., Ltd., Nichi-Etoku Papermaking Equipment (Shanghai) Trading Co., Ltd., and NF Nonwoven). In its core Felt Business, the company manufactures and sells Felt for Paper & Pulp, papermaking Wire, industrial felt, and other products, with domestic paper manufacturers as its main customers. In the Real Estate Leasing Business, the company secures stable earnings by utilizing owned assets such as its head office building. Consolidated net sales for FY2026 (ending March 2026) were ¥9,398 million.
Business Model
The core Felt Business operates a near-stock-type business model that continuously supplies papermaking felt and Wire, which are consumed in the papermaking process, securing stable orders backed by a high domestic market share. Overseas, the company expands into Asian markets through subsidiaries and sales offices in Taiwan, China, Indonesia, and elsewhere. The Real Estate Leasing Business, centered on full occupancy of the head office building, stably records annual sales of ¥625 million and operating profit of ¥359 million, complementing the volatility risk of the Felt Business.
Company Strengths
The company continues to maintain a high market share even in a harsh market environment marked by ongoing production contraction in newsprint, fine paper, and printing paper in Japan. It has pursued proactive sales activities and quality improvements targeting paperboard and household paper machines, accumulating product technologies—such as improved seam felt durability—that are difficult for competitors to replicate.
The company maintains an overseas network including Taiwan Hyer Co., Ltd. (Taiwan's only papermaking felt production base), established in 1968, and a Shanghai trading subsidiary established in 2011. Overseas sales for FY2026 (ending March 2026) turned to growth, reaching ¥1,812 million (up 7.2% year on year), demonstrating expanded sales in the Asian market.
The head office building continues to maintain full occupancy, with risk diversified through leasing to a variety of uses including elderly care facilities, rental apartments, and student dormitories. In FY2026 (ending March 2026), the operating margin of the Real Estate Leasing Business stood at a high level of approximately 57.4% (¥359 million ÷ ¥625 million), functioning as a stable earnings source that complements the fluctuations in earnings from the Felt Business.
ENVALITH's Perspective
Performance Trend
Revenue peaked at ¥10,400 million in FY2023 (ended March 2023) and has since declined for four consecutive periods, reaching ¥9,398 million in FY2026 (ending March 2026), down 3.1% year on year. The main cause is a decrease in domestic sales volume of Felt for Paper & Pulp, reflecting an ongoing structural contraction in the market. On the other hand, operating profit recovered significantly to ¥443 million (up 121.2% year on year), driven by a review of the production structure and efficiency improvements. Ordinary profit rose to ¥747 million (up 59.7% year on year), also supported by an increase in dividend income received (from ¥238 million to ¥311 million), while profit attributable to owners of parent increased to ¥560 million (up 30.3% year on year). However, operating profit is forecast to decline sharply again in FY2027 (ending March 2027) to ¥250 million, suggesting that the recovery seen in FY2026 (ending March 2026) may prove temporary.
Growth Strategy
Strengthening the profit base through three pillars: expanding sales in Asia, increasing domestic market share, and developing high value-added products
A recovery trend was confirmed in China, Indonesia, and other markets in FY2026 (ending March 2026), with overseas sales increasing 7.2% year on year to ¥1,812 million. The company will continue aggressive sales activities across the entire Asian region, including India where demand is growing, aiming for further expansion of the Asia sales ratio (19.8% in FY2026, ending March 2026).
With the domestic pulp and paper market continuing to trend downward, the company is focusing on felt for household paper machines and paperboard machines, where demand is expected to remain resilient, aiming to further expand domestic market share and secure sales through proactive proposal activities that address diverse customer needs.
Quality and production capabilities have been strengthened through the introduction of cutting-edge equipment such as new weaving machines. With an extensive product lineup that now includes Valmet Technologies products, the company has established a system to expand sales of Wire products that meets a wide range of customer requirements.
For Shoe Press Belt, which has steadily built up a track record domestically, the company plans to further strengthen efforts to expand sales overseas, using its accumulated domestic track record as a foothold for overseas expansion.
To turn around Other Industrial Products (sales of ¥1,393 million in FY2026, ending March 2026, down 6.7% year on year), the company will focus on high value-added products such as filters for dust masks, aiming to expand its product lineup in areas where it can leverage its strengths.
Building on the results achieved in FY2026 (ending March 2026), in which SG&A expenses were reduced by ¥348 million year on year and operating profit improved by 121.2% year on year, the company will continue to promote productivity improvement initiatives, aiming to build a robust profit structure capable of securing stable profits.
Last updated: July 19, 2026