Company Overview

(2) Advanced Technology Business

The advanced technology business of Wave Lock Holdings <7940> is divided into decoration & display field (metal decorative films, high transparency multilayer films), converting field, and others (procured commodities), with about 60% of revenue coming from the decoration & display field.

The metal decorative film, which accounts for most of the revenue in the decoration & display field, is made by vapor-depositing special metals onto PET (polyethylene terephthalate) film, laminated with PMMA (acrylic resin) sheet on the surface side and ABS film on the underside to maintain weather resistance, resulting in a six-layer structure through a dry lamination method. This film can take on three-dimensional shapes using various processing technologies such as shaped extrusion molding, film insert molding, and vacuum forming, rather than just being flat. Advantages over plated products include no rust formation and contribution to lightweight vehicle bodies, minimal environmental impact due to absence of wastewater during manufacturing, high permeability to radio waves and light, as well as excellent moldability and design characteristics. These advantages are being recognized, leading to wider adoption in automotive and motorcycle interior and exterior products.

* A processing method where adhesive is applied to the substrate film, dried in a drying oven, and then pressed against another film to laminate them.

In the automotive sector, there are sales records not only in Japan but also in Asia, Europe, and the USA, with a significant increase in sales in North America since 2022 due to the adoption of these films as exterior parts for electric vehicles by USA manufacturers. In the motorcycle sector, demand for emblems is expanding in India and Southeast Asia. The manufacturing bases consist of the Fukaya factory (film production) and Nagoya factory (parts molding processing), but in September 2022, a new Nagoya Second Plant (parts molding processing) was established. Additionally, in April 2023, the Ichinoseki factory was relocated and expanded to enhance film production capacity, and a processing plant for finished parts was established in Ohio, USA to respond to customer requests, reflecting the proactive investment in capacity enhancement to meet growing demand.

Among metal decorative films for automotive exterior use, the Dutch major chemical manufacturer Akzo Nobel N.V. is a competitor, but there appear to be few entrants to the market so far. Additionally, there are methods for producing metal decorative films including the metal vapor deposition method used by the company and Akzo Nobel, as well as the transfer method. While the transfer method excels in mass production and has a lower cost, it often requires a separate hard coat for automotive exterior use due to weaker weather resistance, making the metal vapor deposition method more advantageous according to the company.

Regarding high transparency multilayer films, efforts are being focused on expanding sales in the automotive sector, where the demand for larger in-vehicle Displays such as Center Information Display (CID) and Head-Up Display (HUD) is increasing, leveraging strengths such as high optical properties, low distortion, dust resistance, and impact resistance. Although competition is abundant, including Mitsubishi Gas Chemical <4182>, the product characteristics have been recognized, leading to adoption by European Index auto manufacturers such as Volkswagen.

The HUD (Head-Up Display) is a system that projects images onto the Car Door, displaying various information such as speed and navigation in the driver's line of sight. By projecting information close to the center of the driver's view, this system reduces the burden of eye movements for the driver and supports safe driving, being mainly installed in luxury cars.

The converting field includes non-woven fabric printing for medical patches, printing on release films, and silicone processing, which, although having a small revenue scale, serves as a stable source of income. Additionally, purchasing and sales of diffusion plates and light guide plates for LCD Television monitors and opening tapes for food packaging are also conducted.

(Written by FISCO guest analyst, Jo Sato)