Godo Steel,Ltd.
5410・Prime Market・Iron & Steel
Business
Godo Steel, founded in 1937, is an electric-furnace-focused steel manufacturer whose core Steel Business manufactures and sells wire rods, shapes, bars, rebar and other steel products at six production sites including Osaka, Himeji and Funabashi. It operates as an independent business while maintaining a capital relationship as an equity-method affiliate of Nippon Steel. The Steel Business generated sales of ¥174,307 million, accounting for approximately 91% of consolidated sales. As a second pillar, the company operates the Agricultural Materials Business (sales of ¥12,716 million) through its consolidated subsidiary Asahi Agria, manufacturing and selling Organic Fertilizer, Chemical Fertilizer, Seeds/Seedlings, Dried Forage, and other products. Major customers are steel trading companies including Hanwa Co. (14.2% of sales) and Itochu Marubeni Steel (Itochu-Marubeni Sumisho Techno-Steel) (10.7%).
Business Model
Steel scrap is used as the main raw material, melted and refined in an electric furnace, and processed through continuous casting and rolling to produce wire rods, shapes, bars, rebar, etc. Products are mainly sold to the construction and civil engineering sectors via steel trading companies. Earnings are structured around the spread between selling prices and raw material (steel scrap) and electricity costs, making production control aligned with demand and maintaining reproducible selling prices the core of earnings management. In the Agricultural Materials Business, the manufacture and sale of organic fertilizer and other products secures stable, complementary earnings.
Company Strengths
In addition to its own manufacturing plants in Osaka, Himeji, and Funabashi, the company holds a total of six manufacturing bases, including wholly owned subsidiaries Asahi Kogyo, Sanei Metal Industry, and Tokai. It promotes the integrated operation of the three Kanto mills and the top-runner approach across the four rebar mills, building a flexible production system that can also channel surplus production capacity into exports (non-consolidated export value in FY2025 (ending March 2025) was ¥3,663 million, up ¥1,915 million year on year).
The equity ratio as of the end of FY2026 (ending March 2026) was 56.3% (improved from 52.8% in the previous period). Long-term borrowings were reduced by ¥8,207 million year on year, and net assets expanded to ¥144,249 million. Operating cash flow was ¥21,429 million, exceeding the previous period's ¥19,138 million, maintaining a stable cash generation capability sufficient to cover capital expenditures, debt repayment, and dividends.
The company has begun manufacturing and selling "GODO Green" (trademark application pending), an environmentally conscious steel product utilizing non-fossil-fuel-derived electricity. It is also promoting expanded sales of high value-added products such as Screw-Thread Rebar and High-Strength Rebar (High Value-Added Products), aiming to improve profitability through differentiation from commodity products. R&D expenses totaling ¥315 million were invested across the Steel Business and Agricultural Materials Business, continuing investment in product development and quality improvement.
ENVALITH's Perspective
Performance Trend
Revenue peaked at ¥235,387 million in FY2023 (ending March 2023) and has declined for three consecutive periods since, reaching ¥191,772 million in FY2026 (ending March 2026), down 6.5% year on year. Operating profit fell approximately 45% over two periods, from ¥17,850 million in FY2024 (ending March 2024) to ¥9,813 million. As external factors, labor shortages in the domestic construction sector and work-style reforms have lengthened construction periods, while rising logistics costs and material/equipment prices have led to postponements and cancellations of construction projects, depressing demand for steel products. In addition, ferrous scrap prices have remained elevated despite sluggish domestic demand, and prolonged high energy prices driven by yen depreciation have worsened the cost structure. For FY2027 (ending March 2027), the company forecasts revenue of ¥200,000 million (up 4.3% year on year) and operating profit of ¥6,500 million (down 33.8% year on year); while a gradual recovery in demand is expected in the second half, the profit environment is anticipated to remain even more challenging.
Growth Strategy
Under Medium-Term Vision 2030, the company will implement profitability restoration, value-added product enhancement, and sustainability promotion over a five-year period
Promote integrated operation of the three rebar manufacturing sites in the Kanto region and introduce a top-runner approach at the four rebar mills to enhance production efficiency, reduce fixed cost burden, and improve profitability. Continued promotion as a key initiative of Medium-Term Vision 2030.
Promote higher quality wire rods and structural steel in response to increasingly sophisticated customer needs, and aim to improve profitability by expanding sales of high value-added products such as Screw-Thread Rebar and High-Strength Rebar (High Value-Added Products). With standalone steel product average selling price falling to ¥106.7 thousand/t, escaping price competition is an urgent priority.
Began manufacturing and selling non-fossil electricity steel products "GODO Green" (trademark application pending), leveraging the environmental advantages of an electric arc furnace manufacturer. Together with continued investment in energy-saving equipment, deploying a differentiation strategy to capture decarbonization demand. A pillar of sustainability promotion under Medium-Term Vision 2030.
Under Medium-Term Vision 2030, a capital expenditure plan totaling ¥40.0 billion over five years is planned. In FY2026 (ending March 2026), expenditure for acquisition of tangible and intangible fixed assets was ¥8,988 million (up from ¥6,225 million in the previous fiscal year), entering an investment phase, with construction in progress also surging from ¥1,073 million to ¥4,256 million.
In the Agricultural Materials Business, promoting differentiation through a shift of management resources toward Organic Fertilizer. In FY2026 (ending March 2026), net sales were ¥12,716 million (up ¥519 million year on year) and ordinary income turned positive at ¥275 million (up ¥501 million year on year). M&A is also being continuously considered (in FY2026 (ending March 2026), ¥726 million was spent on acquisition of shares in a subsidiary).
Last updated: July 19, 2026