YUTAKA GIKEN CO.,LTD.

Business Details

The Company and its domestic subsidiaries manufacture Automotive Parts - Four-Wheel (Exhaust System Parts, Drivetrain Parts, etc.), Automotive Parts - Two-Wheel, and General-Purpose Parts, and sell these primarily to Honda Motor Co., Ltd. and its group companies. This segment also functions as the core hub for group-wide R&D and electrification investment. While a gain on sale of shares of affiliated companies was recorded from the transfer of shares in the Indian subsidiary, temporary costs—including expenses associated with the capital structure change, increased R&D expenses, and retirement benefits recorded in connection with the early retirement program—weighed on profit.

Recent Overview

Revenue increased on higher orders, but operating profit fell 26.9% year on year due to temporary costs

In the Japan segment for FY2026 (ending March 2026), revenue increased to ¥43,197 million (up 2.0% year on year) on higher orders from customers. On the profit side, although a gain on sale of shares of affiliated companies was recorded from the transfer of shares in the Indian subsidiary, this was offset by a combination of temporary costs, including expenses associated with the capital structure change, increased R&D expenses, and retirement benefits recorded in connection with the early retirement program, resulting in a substantial decline in operating profit to ¥1,001 million (down 26.9% year on year).

Key Products

Growth Drivers

• Revenue increase effect from higher orders from customers (the Honda Motor group) (revenue increased 2.0% year on year in FY2026 as well)
• Expansion of electrification-compatible products through motor-related capital investment at Yutaka Seisakusho and the Tochigi Development Center
• Expectation of recovery in automotive parts demand amid growing HEV and PHEV demand
• Expansion of orders from new customers and new models for laminated core products and other items
• Profitability improvement through continued cost reduction measures

Risks

• Profit pressure from temporary costs, including expenses associated with the capital structure change, increased R&D expenses, and retirement benefits recorded in connection with the early retirement program (the main cause of the 26.9% decline in operating profit in FY2026)
• Extremely high dependence on sales to the Honda Motor group, creating a risk that changes in the group's production and procurement policies will directly affect performance
• Risk of long-term decline in demand for existing exhaust system and drivetrain parts due to the shift to electrification
• Rising fixed cost burden due to increased R&D and capital expenditure
• Deterioration in export profitability due to yen appreciation (the impact of exchange rate fluctuations is becoming apparent across the group as a whole)
• Risk of changes in management policy and capital policy following the delisting after completion of the tender offer by Motherson Global Investments B.V.