ENVALITH
大石産業株式会社 logo

OHISHI SANGYO CO.,LTD.

3943・Standard Market・Pulp & Paper

Official website
大石産業株式会社 logo
OHISHI SANGYO CO.,LTD.3943

Business

Oishi Sangyo, founded in 1925, marked its 100th anniversary in 2025 as a comprehensive manufacturer of packaging-related materials. Its core operations consist of two segments: the Cushioning Materials Business (Pulp Mould, Corrugated Cardboard Products, etc.) and the Packaging Materials Business (Film Products, Heavy-Duty Packaging Bags, etc.), with revenues of ¥11,638 million and ¥11,401 million respectively, representing roughly equal scale. The company primarily targets customers in the industrial, food, and agricultural sectors, and operates multiple domestic plants as well as a manufacturing and sales subsidiary in Malaysia. Listed on the Standard Market of the Tokyo Stock Exchange, it maintains a financial base of ¥28,054 million in total assets and ¥19,611 million in net assets.

Business Model

The company's basic model is direct manufacturing-to-sales, handling everything in-house from production at its own factories through to sales. In the Cushioning Materials Business, it operates a make-to-order production system with immediate delivery, supplying Pulp Mould and Corrugated Cardboard Products to the industrial, food, and agricultural sectors. In the Packaging Materials Business, it sells Film Products and Heavy-Duty Packaging Bags to domestic and overseas customers in flour milling, animal feed, synthetic resin, electronic materials, and other industries. Sales to the major customer FP Corporation amounted to ¥2,993 million (12.7% of net sales), indicating a certain degree of customer concentration.

Company Strengths

The pulp mould business established its own manufacturing system, progressing from entry as a sales agent in 1972 to the absorption-type merger with a manufacturing company in 1982. The company holds proprietary technologies such as its environmentally conscious product 'Paramil,' which utilizes recycled waste paper, and segment profit for the Cushioning Materials Business in FY2026 (ending March 2026) reached ¥1,181 million (up 34.8% year on year), demonstrating high profitability.

Domestically, the company operates multiple plants including Kurate, Hachinohe, Ibaraki, Kokura, and Nogata, while overseas it holds manufacturing subsidiaries in Malaysia, CORE PAX(M)SDN.BHD. and ENCORE LAMI SDN.BHD. This multi-site structure spanning Japan and abroad ensures supply stability and regional responsiveness. Total capital expenditure in FY2026 (ending March 2026) reached ¥3,263 million, with capacity expansion investment continuing primarily at the Ibaraki plant.

Total net assets at the end of FY2026 (ending March 2026) stood at ¥19,611 million, and the equity ratio against total assets of ¥28,054 million remained at a high level of approximately 70%. Long-term borrowings are limited, and the company maintains a policy of funding capital expenditure through a combination of internal funds and borrowings. Operating cash flow secured ¥2,292 million, indicating a high degree of financial stability.

ENVALITH's Perspective

In FY2026 (ending March 2026), net sales were ¥23,487 million (up 0.0% year on year), essentially flat, while operating profit declined to ¥717 million (down 20.7% year on year), and the operating margin fell to 3.1% (from 3.9% in the previous period). The main causes were an increase in depreciation expenses (¥1,208 million, up ¥208 million year on year) associated with expanded capital expenditure, and higher personnel costs, both of which represent structural cost pressures expected to persist over the medium term. The forecast for FY2027 (ending March 2027) calls for operating profit of ¥392 million (down 45.4% year on year), pointing to further deterioration, and the severity of profit pressure during this investment phase is significant.

Segment profit in the Packaging Materials Business fell sharply to ¥626 million (down 32.7% year on year). Heavy-Duty Packaging Bags (Overseas) suffered from declining demand for synthetic resins and chemicals, while the Film segment saw both a decrease in sales volume of polystyrene film for food containers and cast film for automotive applications, and a decline in unit selling prices due to falling raw material market prices. External headwinds also continued, including crude oil price fluctuations stemming from Middle East tensions and the inflow of low-priced products amid China's economic slowdown. The timing of the recovery in overseas business profitability will be a key point in investment decision-making.

Acquisitions of property, plant and equipment in FY2026 (ending March 2026) totaled ¥2,480 million (up ¥771 million year on year), reflecting continued aggressive investment. Construction in progress surged from ¥304 million to ¥2,067 million, with the enhancement of the Ibaraki plant's facilities and a new multilayer T-die production line nearing operation. Whether these facilities come online and lead to expanded sales of high-value-added products is key to profit recovery, but the FY2027 (ending March 2027) forecast projects net sales of ¥24,323 million (up 3.6%) against net income of ¥416 million (down 42.5%), indicating that investment burdens will continue to weigh on results ahead of any recovery. The dividend payout ratio stands at 98.0%, reflecting continued profit pressure to maintain shareholder returns.

Growth Strategy

Under the 8th Medium-Term Management Plan 'New Challenge 2027,' the company aims to rebuild its earnings base through a shift toward circular products and higher value-added offerings.

The company is advancing equipment expansion at the Ibaraki Plant to increase the supply capacity of environmentally friendly pulp mould products. Construction in progress has surged to ¥2,067 million (from ¥304 million in the prior period), and once the equipment becomes operational, it is expected to directly contribute to increased revenue and profit in the Cushioning Materials Business.

With the launch of a new production line utilizing multi-layer T-die technology, the company is accelerating the development of specialty films for electronic materials, automotive, and healthcare applications, aiming for full-scale entry into growth markets. The film segment currently continues to experience declining revenue and profit, and improving the product mix through the new line is key to a recovery in profitability.

The company is promoting market deployment of 'Paramil,' a high value-added pulp mould product based on proprietary technology. Leveraging the tailwind of accelerating demand for conversion from petroleum-derived products to paper-based packaging, it is focusing on new product development and the cultivation of new demand areas.

The Japanese Agricultural Products Import & Sales Business (Malaysia), operated by FUSIONS TRADING MALAYSIA SDN. BHD., is in its initial launch phase and is currently recording losses (segment loss of ¥33 million in FY2026 (ending March 2026)). An impairment loss of ¥16 million was also recorded, making early profitability a key challenge.

The company is promoting DX and FA primarily in the Packaging Materials Business to resolve labor shortages, facilitate technology transfer, and achieve consistent high quality. Amid rising labor costs that are putting pressure on profits, the fixed-cost reduction effect from improved manufacturing efficiency is expected to contribute to medium-term earnings improvement.

Last updated: July 19, 2026