Okayama Paper Industries Co.,Ltd.
3892・Standard Market・Pulp & Paper
Business
Okayama Paper Industries Co., Ltd. was founded in 1907 and manufactures and sells paperboard, primarily Chuushin Genshi (Corrugating Medium Raw Paper) and Paper Tube Base Paper, as well as decorative corrugated board, using its Okayama head office plant as its sole production site. The Paperboard Business is the core business, accounting for approximately 88% of net sales, supplying corrugated board raw paper and Paper Tube Base Paper mainly to the Chugoku region. In the Decorative Corrugated Board Business, the company manufactures packaging boxes and gift boxes for fruits/vegetables, food, and home appliances on a made-to-order basis. Oji Holdings Corporation is positioned as the largest shareholder as another affiliated company, and the company also sells products through sales companies within the Oji Holdings group. The company is listed on the Standard Market of the Tokyo Stock Exchange.
Business Model
In the Paperboard Business, the company operates 24-hour forecast-based production of Chuushin Genshi (Corrugating Medium Raw Paper) and Paper Tube Base Paper, using recovered paper as the main raw material, and secures earnings by stably supplying these products to customers, including sales companies affiliated with Oji Holdings. In the Decorative Corrugated Board Business, an integrated production system co-locating paper mills and processing plants at the same site enables superior quality and delivery control as well as total cost competitiveness, while providing added value through make-to-order production. The company maintains debt-free management, funding all capital needs with its own funds.
Company Strengths
Founded in 1907 with 117 years of operating history, the company has maintained capital ties since 2009 with Oji Holdings Corporation as its largest shareholder and other affiliated company. It secures a stable sales network through trading with Oji Holdings group companies Mori Shihan, Saga Itagami, and Oji Container.
The company has built an integrated production system with a papermaking plant and processing plant co-located at its Okayama head office. This enables systematic quality and delivery management, and leverages accumulated technology and know-how to achieve total cost advantages. Capital expenditures in FY2025 (ended May 2025) totaled ¥650 million (up 86% year on year), reflecting continued active investment in updating production facilities.
At the end of FY2025 (ended May 2025), net assets stood at ¥12,944 million, and the equity ratio against total assets of ¥16,593 million was approximately 78%. The company maintains debt-free management, funding all capital needs internally, with cash and cash equivalents of ¥4,466 million. Its financial stability is at a high level.
ENVALITH's Perspective
Performance Trend
Revenue declined for the second consecutive period after peaking at ¥11,512 million in FY2024 (ended May 2024), falling to ¥11,221 million in FY2026 (ending May 2026), down 2.6% year on year. Paperboard sales volume decreased 1.0% year on year, reflecting sluggish domestic paperboard demand. Operating profit fell 44% over two periods, from ¥1,682 million in FY2024 (ended May 2024) to ¥940 million in FY2026 (ending May 2026). Meanwhile, net income attributable to owners of parent rose modestly to ¥821 million (up 2.9% year on year), but this was due to the recognition of ¥34 million in gains on sales of investment securities and a reversal in deferred income tax adjustments (△¥60 million), and does not reflect a recovery in core business performance. As an external factor, waste paper prices remained stable, but persistently high fuel and electricity costs along with rising labor costs are structurally compressing profit margins. Operating cash flow recovered substantially from △¥1,569 million in the previous period to ¥1,661 million, indicating that cash generation capacity has normalized.
Growth Strategy
Strengthening the earnings base through cost reduction via energy conservation and equipment upgrades, combined with price revisions and digital sales expansion in the Decorative Corrugated Board Business
The company invested ¥779 million in acquisition of tangible fixed assets (FY2026, ending May 2026), increasing the net amount of machinery and equipment from ¥1,556 million to ¥1,881 million. Through the introduction of energy-saving and automatic control devices, the company continues to reduce electricity and fuel costs, aiming to lower manufacturing costs.
Price revisions have been implemented across a broad range of products, starting with those for fruits and vegetables, improving the segment loss from ¥44 million to break-even (¥0 million) in FY2026 (ending May 2026). The company aims for full-scale profit contribution through expanded sales of Digital Printing Products (Glory1606 Compatible) using six-color inkjet printers and diversification of sales destinations (home appliances, pharmaceuticals, beverages, etc.).
Amid an environment where domestic paperboard demand lacks strength, the company is leveraging export sales to support sales volume while promoting the maintenance of appropriate pricing and the development of new business partners. The export ratio increased from the second quarter of FY2026 (ending May 2026) onward, and flexible adjustments to the sales composition were implemented.
Against the backdrop of a declining workforce and difficulty in securing talent, the company continues to invest in human capital. Employee salaries and bonuses increased to ¥336 million (up 3.3% year on year), and together with efforts to reduce environmental impact, the company has set the realization of sustainable corporate management as a medium- to long-term management policy.
Last updated: July 17, 2026