TOKYO TEKKO CO., LTD.

Business Details

Manufactures and sells small bars (rebar for reinforced concrete and rolled steel bars for general structure) based on JIS standards, as well as mechanical rebar splicing joints. Focuses on expanding sales of high-value-added products centered on the mainstay product "Neji Tekkon," and provides engineering services that contribute to labor-saving and workforce reduction at construction sites. Affiliated companies include Totetsu Sangyo, Tokyo Tekko Doboku, Kanto Metal Co., Ltd., Ito Seitetsusho Co., Ltd., and others. This is the core business, accounting for approximately 98% of consolidated net sales.

Recent Overview

Both sales and profit declined significantly year on year due to lower shipment volumes combined with a surge in scrap steel prices

In FY2026 (ending March 2026), Steel Business segment net sales were ¥71,575 million (down approximately 12.1% year on year), and segment profit was ¥11,783 million (down approximately 17.6% year on year). The main cause was a decline in shipment volumes of rebar and related products. From the second half of the fiscal year, a sharp surge in the price of scrap steel, the main raw material, combined with construction delays and project reviews stemming from labor shortages and rising costs of various materials, led to a persistent slump in shipments. An impairment loss of ¥228 million was also recorded during the period. On the other hand, capital expenditure (increase in property, plant and equipment and intangible assets of ¥5,745 million) remained at a high level, and efforts to strengthen production capacity continue.

Key Products

Growth Drivers

• Promoting expanded sales of high-value-added products (large-diameter, high-strength rebar) centered on Neji Tekkon (through regional expansion and extending the target from high-rise buildings to low- and mid-rise properties)
• Advancing a customer-problem-solving differentiation strategy through strengthened proposal-based sales of labor-saving and workforce-reduction solutions
• Strengthening profitability through product price improvements (securing metal spread) and various cost reductions (production and logistics cost reductions)
• Enhancing operational efficiency and competitiveness through the promotion of the DX strategy
• Under the new medium-term management policy (FY2026–3-year period), pursuing "strengthening a high-profitability structure," "creating profitable mechanisms," and "promoting sustainability management," with targets of average consolidated ordinary profit of over ¥100 million and ROE of over 11.0% over the three-year period
• Supplementing production sites through the capital and business alliance with Ito Seitetsusho Co., Ltd.

Risks

• Shrinking domestic demand for small rebar bars (shipment volumes continue to be sluggish due to construction delays caused by labor shortages and project reviews prompted by rising construction costs)
• Risk of deteriorating metal spread due to sharp increases and volatility in the price of scrap steel, the main raw material (a sharp surge became apparent in the second half of the fiscal year)
• Risk of declining product shipment prices (a factor depressing sales and profit)
• Medium- to long-term downward trend in demand for steel bars due to population decline and the declining birth rate
• Changes in demand structure due to the spread of work-style reforms at construction sites
• Risk of rising manufacturing costs due to surging prices of various materials and inflation
• Risk of sales concentration among major customers (Itochu Marubeni Steel, MM Kenzai, Hanwa, etc.)
• Risk of declining profitability of fixed assets, as evidenced by the impairment loss recorded in the current period (¥228 million)