ENVALITH
株式会社 光・彩 logo

Kohsai Co.,Ltd.

7878・Standard Market・Other Products

Official website
株式会社 光・彩 logo
Kohsai Co.,Ltd.7878

Business

Koh-Sai Co., Ltd. was founded in 1967 and is a manufacturer, processor, and seller of precious metal accessories based in Kai City, Yamanashi Prefecture (listed on the Tokyo Stock Exchange Standard Market and the Nagoya Stock Exchange Main Market). Using gold, platinum, gemstones, and other materials as raw inputs, the company focuses on two main product categories: Jewelry Parts Products (such as earring findings) and Jewelry Products (such as forged bridal rings). The company holds a 50% domestic market share in Jewelry Parts Products and 70% in earring findings, functioning as a standard parts supplier for the fashion jewelry industry. Its principal customers are jewelry manufacturers and retailers in Japan and overseas. Net sales for FY2026 (ending January 2026) were ¥4,241 million.

Business Model

The company's core competitive advantage lies in proprietary technology that combines artisan craftsmanship with state-of-the-art machining, generating revenue through two business lines: Jewelry Parts Products (make-to-stock) and Jewelry Products (make-to-order). It has fully internalized wire-drawing and rolling processing of raw materials, securing manufacturing cost competitiveness. When bullion prices surge, the company passes costs through to selling prices via price revisions, enabling simultaneous growth in both revenue and profit. Productivity improvements through capital investment and process automation are driving margin improvement.

Company Strengths

The securities report states a 50% domestic market share in the jewelry parts field, rising to 70% when limited to earring findings. The company has established its position as the standard parts supplier for fashion jewelry, and sales of Jewelry Parts Products in FY2026 (ending January 2026) reached ¥3,038 million (108.2% year-on-year), continuing stable growth.

In 1985, the company completed in-house production of precious metal wire-drawing and rolling processing, achieving 100% internal production. This vertically integrated manufacturing system, which eliminates external procurement costs, supports pricing power and cost control capability even amid fluctuations in bullion prices. Continued capital investment and process automation have also driven improvements in per-hour productivity.

The company possesses proprietary processing technology specialized in forged bridal rings and offers patented products such as earring parts. It continues to develop high-value-added products emphasizing functionality and safety, including ultra-lightweight design, consideration for metal allergies, and elimination of carcinogenic substances. Sales of Jewelry Products in FY2026 (ending January 2026) reached ¥1,156 million (107.2% year-on-year).

ENVALITH's Perspective

For the cumulative first quarter of FY2027 (ending January 2027), the company recorded revenue of ¥1,588 million (up 55.1% year-on-year), operating profit of ¥361 million (up 435.6% year-on-year), and quarterly net profit of ¥251 million (up 560.4% year-on-year), extremely strong figures. However, the company itself explains this as "a temporary impact from inventory valuation gains associated with the rapid rise in raw material prices," and the sharp rise in bullion prices for gold, platinum, and other metals as an external factor appears to have substantially boosted the profit margin. Against the full-year forecast (operating profit of ¥400 million), ¥361 million was recorded in the first quarter alone, suggesting either that the full-year forecast is conservative or that the company anticipates normalization of the profit margin over the remaining three quarters.

The full-year forecast (revenue of ¥5,000 million, operating profit of ¥400 million, net income of ¥260 million) remains unrevised. The first-quarter progress rate stood at 31.8% for revenue, 90.4% for operating profit, and 96.7% for net profit, indicating markedly ahead-of-schedule progress on the profit side, suggesting the possibility of a full-year upward revision. On the other hand, inventories increased by ¥343 million, from ¥1,514 million at the end of the previous fiscal year to ¥1,858 million, and short-term borrowings also increased from ¥1,140 million to ¥1,240 million. Continued attention is needed regarding the risk of inventory valuation losses should bullion prices reverse, as well as the impact of working capital expansion on cash flow.

From FY2022 to FY2026, revenue grew for five consecutive periods, from ¥2,990 million to ¥4,242 million, and in the first quarter of FY2027 (ending January 2027), the operating profit margin on revenue reached 22.8%. However, over the past five fiscal years, the full-year operating profit margin peaked at around 4.2% in FY2026, and the high profit margin in the first quarter is considered to be primarily attributable to the temporary contribution of inventory valuation gains resulting from the external factor of surging bullion prices. Confirming structural growth factors—such as steady progress in overseas orders (with foreign exchange trends as a tailwind, an external factor) and progress in developing new domestic and overseas customers—will be key to assessing sustainable earning power.

Growth Strategy

Sustainable growth through deepening proprietary technology, expanding high-value-added products, strengthening overseas expansion, and automating equipment

The Company is promoting product proposals that emphasize functionality and added value, such as ultra-lightweight products and asset-value products leveraging proprietary technology. It is strengthening its response to diversifying customer needs, aiming to improve unit selling prices and maintain competitive advantage through differentiation. In the first quarter of FY2027 (ending January 2027), domestic orders, including volume, trended steadily, confirming the effectiveness of this initiative.

Through strengthening its sales structure, the Company is promoting the development of new customers and expansion of sales channels both domestically and overseas, as well as deepening business relationships with existing customers. In the first quarter of FY2027 (ending January 2027), a stable order environment was maintained both domestically and overseas, with overseas orders also trending generally steadily against the backdrop of foreign exchange trends. Increased recognition through the dual listing on the Tokyo Stock Exchange and Nagoya Stock Exchange also contributes to the medium-term expansion of the customer base.

The Company is working to improve labor productivity per hour through reviewing the production structure, improving work efficiency at each process, addressing necessary repairs and maintenance, and making capital investments that contribute to improved production efficiency. Depreciation expense in the first quarter of FY2027 (ending January 2027) increased to ¥16 million (compared to ¥13 million in the same period of the previous year), confirming that capital investment is being implemented on an ongoing basis.

Amid continued surges in bullion prices and sustained high energy prices, the Company is continuously working on thorough cost management and optimization of trading terms. In the first quarter of FY2027 (ending January 2027), the gross profit margin improved significantly to 33.1% (compared to 21.0% in the same period of the previous year), and while this includes the temporary effect of inventory valuation gains, the effects of cost management measures are also reflected in the figures.

Last updated: July 17, 2026