■Company Overview
2. Business Overview
The business of Shoei Pharmaceutical ＜3537＞ is disclosed in the three segments of “chemicals business,” “daily necessities business,” and “civil engineering and construction materials business.” The sales ratio by segment (results for the fiscal year ending 2024/3) was 90.8% for the chemicals business, 3.3% for the daily necessities business, and 5.9% for the civil engineering and construction materials business.
(1) Chemicals business
The chemicals that the company mainly handles are called oleochemicals, and they are chemical products made from natural oils and fats derived from plants and their synthetic products. Specific oleochemicals are fatty acids, aliphatic amines, fatty alcohols, glycerin, etc. produced using vegetable oils and fats such as coconut oil and palm oil as raw materials, and at the same time, oleochemicals are the name of a process, and at the same time, they are also used as a general term for products produced by that process. On the other hand, the opposite of oleochemicals is petrochemicals, which mainly use petroleum as a raw material, but in a broad sense, some products derived from petroleum are also contained in oleochemicals.
In this field, the company is a trading company, not a manufacturer. The leading manufacturer in the domestic oleochemical domain is Kao, and the company has established a position as Kao's main sales agent. Specifically, Kao's chemical division accounts for approximately 40% of the company's purchase price. Conversely, when viewed from Kao's side, the company is in a top class position in terms of scale as a sales agent in the chemical division, but in particular, the company is at the top when it comes to handling high-grade alcohol.
The company mainly purchases oleochemical products from Kao and sells them mainly to surfactant manufacturers. A surfactant is a general term for a substance having the property of lowering the interfacial tension of two substances having the property of repelling each other, and soap and detergent are specific ones. Utilizing the effect of mixing things with different properties such as water and oil, surfactants are widely used in foods, cosmetics, pharmaceuticals, textile products, dyes, pigments, paints, etc. in addition to soap and detergent. The company also purchases surfactants from the above surfactant manufacturers and sells them to end product manufacturers such as cosmetics, food, pharmaceuticals, etc. If surfactant manufacturers are centered, they are both supplying raw materials (oleochemical products) and selling products (surfactants).
(2) Daily necessities business
It entered the daily necessities business by commercializing household detergents in 1987. At the time, they had production subsidiaries within the group, but since they withdrew from all production activities in 2014, they are currently working as a fabless manufacturer that has outsourced production to external cooperating factories in cooperation with the chemical business, etc., and put effort into planning and drafting.
Production items span a wide range of topics, such as washing machine laundry tub detergents, refrigerator deodorants, shoe deodorizing sprays, etc., centering on all kinds of household consumables. The main business is supplying these to OEM (partner brands). In recent years, we have also been focusing on sales under our own brand, but since the brand power of our own brand is still weak and limited to sales channels such as e-commerce (EC) and home centers, the sales structure ratio remains at a few percent.
The breakdown by sales channel (2024/3 fiscal year) on a basis including OEM suppliers is approximately 56.4% for co-ops, 31.5% for mass retailers, 7.4% for manufacturers, 3.1% for internet sales, and 1.6% for others (commercial use, drugstores, etc.).
(3) Civil engineering and construction materials business
The civil engineering and construction materials business is broadly divided into three areas: “ground improvement,” “repair/reinforcement of concrete structures,” and “improvement of contaminated soil,” and supplies chemicals used in each area. Of these, the company divides and displays “ground improvement” and “concrete structure repair/reinforcement” as civil engineering and construction material-related, and “improvement of contaminated soil” as environment-related. According to the results for the fiscal year ending 2024/3, sales related to civil engineering and construction materials were 81.8%, and environment-related sales were 18.9%.
In the civil engineering and construction materials business, the company does not carry out construction, and supplies chemicals used in construction (purchase and sale from chemical manufacturers) in response to orders from execution companies that have undertaken construction. The company, which stands between construction companies and chemical manufacturers, makes use of its abundant amount of information and ability to gather information, and provides added value by providing customer needs, feedback, etc. related to product information, material/construction method development.
(Written by FISCO Visiting Analyst Noboru Terashima)