■Daiki Axis ＜4245＞ Company Overview

1. Company Overview

The company group is developing a complex business that protects the global environment and creates a sustainable society and future, centering on businesses related to “water,” such as sales of products related to plumbing houses and provision of septic tanks and industrial wastewater treatment systems.

The company, which has celebrated its 65th anniversary, has the conventional corporate slogan “PROTECT × CHANGE” (protect what should be protected, change what should be changed). The philosophy system was organized as an enterprise spirit. “We protect the environment through the practice of “solving global environmental issues with technology and ideas and supporting the lives of people around the world,” which is the raison d'être of the Group. Change the future.” The idea is to accomplish this mission.

In particular, in the main “environmental device-related business,” it is deeply involved in “safe water and toilets around the world,” which is 6th out of 17 “sustainable development (SDGs)” adopted at the United Nations summit. Above all, in emerging countries in Asia and Africa, environmental pollution due to water pollution cannot be overlooked, and the importance of the company's role and business opportunities are expanding globally. The Group's strengths lie in the fact that it has an integrated design, manufacturing, sales/construction, and maintenance system and high quality in the small to medium scale water treatment business, and there is a high possibility that its superiority will be demonstrated in emerging countries, and they are working on overseas expansion of “environmental equipment related businesses” as part of their growth strategy.

2. Business structure

In addition to the “housing equipment-related business” and “environmental device-related business,” which have been businesses since the beginning of establishment, the “renewable energy-related business,” which has been segmented since the 2018/12 fiscal year, has become the three main pillars. Among them, the “environmental equipment related business,” which develops water treatment businesses spanning from tap water to sewage (septic tanks, wastewater treatment systems, etc.) for domestic and overseas markets, accounts for about 50% of sales and about 70% of operating profit before adjustment.

3. HISTORY

It was founded in 1958 in Matsuyama, Ehime Prefecture, and celebrated its 65th anniversary in 2023. The predecessor Daiki Co., Ltd. was established in 1964, and production of vacuum septic tanks began in the same year. Daiki, which embarked on the home center business in 1978, formed a business alliance with Homac Co., Ltd. and Kama Co., Ltd. in the same industry in 2003, and decided on a business integration. The current DCM Holdings ＜3050＞ was established in 2006, but prior to that, Daiki established the company as a receiving company for operations other than home centers, and transferred the business. After that, since it became independent from Daiki due to MBO (management buyout), the capital relationship between the company and Daiki disappeared, but a good business relationship continues. The business area was expanded from the wholesale of housing equipment, which is the ancestral business, and the three pillars of management were built: “environmental equipment related business” and “renewable energy-related business” by utilizing M&A, etc. The overseas business, which we are focusing on by positioning it as a growth market, built a bridgehead for the Southeast Asian market by acquiring a local Indonesian company in 2013. A subsidiary was established in 2018 in India, which has a large potential market.

The company was newly listed in the chemical sector on the 2nd section of the Tokyo Stock Exchange (hereafter, Tokyo Stock Exchange) market in 2013/12, and was designated as section 1 in 2014/12. In the new market segment of the Tokyo Stock Exchange from 2022/4, it has transitioned to the prime market. We are actively expanding overseas in “environmental equipment related businesses,” and we have selected a market segment that is aimed at companies centered on constructive dialogue with global investors. A sustainability committee was established and an integrated report was issued. However, there are large uncertainties regarding clearing the market capitalization standard for tradable stocks, and as a result of comprehensively judging the business environment and the interests of existing shareholders, starting with delisting risks after completion of transitional measures that may occur when maintaining listing on the Prime Market without meeting the listing maintenance standards in the Prime Market, an application for selection to the standard market was made in 2023/5, and the market division was changed to the standard market in October of the same year. In 2024/1, Mr. Hiroshi Okame, who has served as President and CEO since our establishment in 2005, became Chairman of the Board, and Mr. Yuki Okame took office as President and CEO in his place.

(Written by FISCO Visiting Analyst Ikuo Shibata)