Company overview of Waveblock Holdings, Inc. <7940>.

(2) Advanced Technology Business

Advanced Technology Business is divided into Decoration & Display Field (metallic decoration film, high-transparency multilayer film), Converting Field, and Others, with more than half of its revenue coming from the Decoration & Display Field.

Metallic decorative films that account for the majority of sales in the Decoration & Display field are a 6-layer structure that is created by depositing special metals on PET (polyethylene terephthalate) film, placing PMMA (acrylic resin) sheet on the surface side to maintain weather resistance, ABS film on the bottom side and bonding them together using a dry lamination method*. These films are not only flat, but can also be processed into three-dimensional shapes using various processing techniques such as shape extrusion molding, film insert molding, and vacuum molding. Compared to plated products, their advantages are that rust does not occur and contribute to the weight reduction of the body, no waste liquid is generated during manufacturing, and they have high radio wave and light transmittance, as well as superior moldability and design properties. These advantages have been highly evaluated, and they have been widely adopted for interior and exterior products of automobiles and motorcycles.

*A method of processing by coating adhesive on a film as the base material, drying it in a drying furnace, and then bonding it by pressing it against another film.

For automobiles, they have sales records not only in Japan, but also in Asia, Europe, and North America. Since entering 2022, it has rapidly increased its sales in the North American market, such as being adopted as exterior parts for electric vehicles manufactured by American automakers. For motorcycles, demand has been expanding in India and Southeast Asia as emblems. The manufacturing bases were a two-base structure: the Furukawa plant (film production) and the Nagoya plant (part molding and processing), however, in September 2022, they established the Nagoya Second Plant (part molding and processing) for responding to expanding demand. In addition, in April 2023, they relocated and expanded the Ichinoseki plant to establish an increased production of films, and opened a finished parts processing factory in Ohio in response to customer requests in the United States.

For metallic decoration films, Akzo Nobel N.V. (AkzoNobel), a major chemical company in the Netherlands, is cited as a rival for automotive exterior use, but it seems that there are still few entrant companies. In addition to the metal deposition method adopted by the company and AkzoNobel, there are also transfer methods. Although transfer methods are cost-effective because they have excellent mass productivity, they are weaker in weather resistance, and often require hard coating for automotive exteriors. Therefore, the company sees that metal deposition method has the advantage.

Regarding high-transparency multilayer films, they focus on expanding sales in the automotive field for interior displays (such as Center Information Displays (CIDs) and Head-Up Displays (HUDs)*) by utilizing their characteristics such as high optical properties, minimal distortion, dust-proof properties, and impact resistance. Although there are many rivals such as Mitsubishi Gas Chemical Co., Inc. <4182>, their product characteristics have been evaluated, and have provided adoption records for European automakers such as Volkswagen.

*HUD is a system that displays various information such as vehicle speed and navigation on the driver's line of sight by projecting images onto the car's front windshield. It is installed mainly in high-end cars as a system that reduces driver stress by projecting information close to the center of the driver's field of view, thereby supporting safe driving.

Although the converting industry business includes nonwoven fabric printing of medical adhesive plasters and printing and silicon processing on release films, it is a small-scale business but a stable source of revenue. They also engage in purchasing and selling diffusion plates and light guide plates for liquid crystal TV monitors, as well as opening tape for food packaging.

(Written by FISCO guest analyst, Jo Sato)