■Mitsui Matsushima Holdings' Business Description ＜1518＞
(4) Systec Kyowa
Systec Kyowa, which acquired shares in February 2021, plans, manufactures, and sells housing-related components such as door stoppers and earthquake-resistant latches. Since we have our own factory in Thailand, we can consistently carry out production within the group from planning to molds, molding, and assembly, and we are proud of our high market share within the industry. In addition, we have built strong relationships through direct transactions with major housing and building materials manufacturers, and are also jointly developing products and filing joint patent applications. Currently, the tough market environment continues, with the number of newly built housing starts decreasing due to the fact that housing prices remain high against the backdrop of soaring material prices, etc. Going forward, the policy is to expand business performance by actively searching for the development of new markets where Systec Kyowa's technological superiority can be utilized.
(5) MOS
MOS, which acquired shares in 2023/2, handles various types of thermal roll paper, such as register/POS roll paper used as receipt for register machines, ticket vending machine roll paper used for meal tickets and various admission tickets, etc., and roll paper for waiting reception numbers used as number tags to respond to order of visitors. Thermal roll (thermal paper) is a recording paper that changes color by sensing heat, has low maintenance costs because ink is unnecessary, and is used for various purposes, starting with receipts. MOS, which was founded in 1962, has a particularly high market share in the processing and sale of heat-sensitive regilol, and has established the number one position in the industry. According to survey results announced by the Ministry of Economy, Trade and Industry in 2023/4, the ratio of cashless payments has gone from 13.2% in 2010 to 36.0% in 2022. Among them, credit cards account for a large percentage of 30.4%. Considering that the government has set a target of reducing the cashless payment ratio to about 40% by 2025, it is expected that the cashless payment ratio will continue to increase in the future. There are many receipts issued during credit card payments, with a total of 3 cards for users, credit card companies, and stores, compared to cash payments, and demand for MOS thermal cash rolls is expected to remain steady in the future. Additionally, in 2023/10, the thermal paper processing and sales business was taken over from Katsumata Co., Ltd., which is a consolidated subsidiary (grandchild company) of Mitsubishi Paper Mills Co., Ltd. ＜3864＞. Katsumata's thermal regilol has strengths in the field where it will eventually be used in major convenience store chains, etc. MOS, which has excelled at sales channels such as supermarkets and drugstores, looks like it has acquired a new sales channel called convenience stores with this business transfer. It is likely that the speed of business expansion will increase further in the future.
Industrial product field
(6) CST
CST, which acquired shares in 2017/2, manufactures and sells mask blanks* used to manufacture liquid crystal panels, organic EL, electronic components, etc. It was founded in 1977 as Japan's first manufacturer specializing in mask blanks, and has an excellent customer base including leading domestic and international manufacturers. Since CST products are consumed during the customer product development process, they are relatively less likely to be affected by trends in final products, and business performance has remained stable.
* Mask blanks are materials for drawing circuit patterns of semiconductors, etc., and play a role like the original version of a print.
Regarding the market environment, although semiconductors have a boom/recession cycle called the silicon cycle, we expect that they will stabilize over the medium to long term. Although the market environment has been soft since mid-2022 in response to global inflation and heightened geopolitical risks, etc., there are signs that the market is currently bottoming out. Major trends such as 5G, big data, AI, and IoT continue, and since semiconductors play an important role in supporting these digital technologies, and there is a government policy to establish mass production systems in one's own country from the viewpoint of economic security, etc., we believe that demand for semiconductors will remain steady over the medium to long term. In fact, the global semiconductor market size is expected to grow from 335,168 million US dollars in 2015 to 574,084 million US dollars in 2022 (CAGR is 8.0%), and further expand to 588,364 million US dollars in 2024 ※1. Also, sales volume of semiconductor devices made in Japan is expected to expand from 2,383.5 billion yen in 2020 to 4,4383 billion yen in 2025*2.
*1 Source: World Semiconductor Market Statistics (WSTS)
*2 Source: Japan Semiconductor Manufacturing Equipment Association
(7) Sansei Electronics
Sansei Electronics, which acquired shares in April 2020, manufactures and sells measuring instruments and production equipment for crystal devices*, and manufactures and sells related hardware and software. Established in 1963, it is the only equipment manufacturer in Japan that can construct in-line systems covering a wide range of crystal device manufacturing processes from assembly to inspection. Strong relationships with customers, price competitiveness, and high technical capabilities are our strengths. In-line systems that include the blank process, which is the preliminary stage of the assembly process, have been developed and sold since the 2022/3 fiscal year, and further differentiation from other companies has been realized. Also, in 2024/1, Sansei Electronics acquired Saunders & Associates through Sansei America, Inc., which was newly established in the United States. Saunders & Associates' network analyzers (measuring instruments for crystal oscillators) are used not only domestically but also by crystal device manufacturers around the world, such as China, Taiwan, Europe and the United States, due to their high accuracy and ease of use. With this acquisition, Sansei Electronics' plan is to further improve its presence in the crystal device industry and pursue the creation of group synergy.
*Electronic components that utilize the (reverse) piezoelectric effect of crystals (the property of vibrating at high speed and accurately when electricity is applied to a substance). It is mounted on all kinds of electronic devices, and is particularly essential for wireless connected devices such as smartphones. Applications are expected to expand in growth fields, such as the electrification of automobiles and 5G communication infrastructure support.
Regarding the semiconductor market, although the inventory adjustment phase continued in response to changes in consumption activity after the COVID-19 pandemic and global inflation, etc., there are signs that it has bottomed out recently. Also, we believe that demand for semiconductors will remain stable over the medium to long term for the reasons described above.
(Written by FISCO Visiting Analyst Yoichiro Shimizu)