■Medium- to long-term outlook
Heheist ＜6433＞ announced a medium-term management plan on 2023/6/27, and “smart production,” “strengthening product capabilities for linear motion equipment,” and “leveling operation rates (avoidance of lost opportunities)” are set as future medium-term strategies (priority measures). Furthermore, in the future, it is planned to consider withdrawing from low-profit products and proceed with concentrating resources on high-profit products (scrap and build product groups).
(1) Smart production
It refers to production where equipment that matches medium- to long-term trends is arranged, plans are made that make use of production capacity, and turnover is achieved every day as planned. Also, linear products for direct motion devices are often produced according to orders (specifications) from customers. Therefore, it is important to accurately communicate requests and specifications from customers obtained by the sales department to the manufacturing department, and ultimately deliver products that the customer is satisfied and satisfied with. We will centrally manage sales and manufacturing information and promote “smart production” so that stable production can be carried out as planned. As a result, production numbers will increase, and we aim to lower production costs.
In line with this plan, construction of a “new factory building” was underway on the site of the company's Saitama Plant in order to increase production of direct motion equipment, but it was completed in 2023/4. As a reason for constructing this factory, the company said, “Demand for semiconductors is increasing year by year due to the progress of digitalization, automation-related and medical-related demand is growing, and existing factories continue to operate at a high level, so it is predicted that a situation will interfere with product supply in the future. Also, in capital investment plans looking ahead to after the novel coronavirus infection epidemic has subsided, it is predicted that existing factories will become too small. For this reason, a new factory building will be newly established at the Saitama Plant for the purpose of establishing a smart production system for direct motion equipment, and production will be strengthened.” The investment amount was approximately 200 million yen (production equipment and travel costs not included), and was covered by own funds and loans. Thus, the productivity of linear motion equipment is further improved, and it is expected that profitability will be greatly improved when orders are received.
(2) Strengthening linear motion equipment product capabilities
THK, which is the company's main customer, announced in the “financial results briefing materials for the fiscal year ending 2022/12” that it aims for sales of “industrial equipment business+others” from 282.1 billion yen for the fiscal year ending 2022/12 to 365 billion yen (29.4% increase from the fiscal year ending 2022/12), but it seems that this target has not changed even now (when financial results for the 1st quarter of the fiscal year ending 2024/12 were announced). In line with this, the company is also planning to “strengthen product capabilities” and “improve production capacity.”
In the product market for products used in various machines, the company boasts the top market share for straight models, but its market share is low for flanged ones, and they are trying to strengthen productivity with flanges. In addition, we have a lineup of new products for THK, and we are also strengthening the product capabilities of linear motion devices, so how far the THK brand can be utilized as an OEM product for THK is probably an important issue.
(Written by FISCO Visiting Analyst Noboru Terashima)