■Business Overview

1. Key business segments

The business segment of Konishi ＜4956＞ was divided into 4 segments: “bonds,” “chemicals,” “civil engineering and construction,” and “others” until the fiscal year ended March 31, 2021. From the 2022/3 fiscal year, some products from the bond business (mainly civil engineering construction adhesives, sealants, etc.) included in “civil engineering construction” until then were transferred back to the “bond” segment, and the remaining 4 construction companies became the “construction business” segment. As a result, the sales ratio for the fiscal year ended 2024/3 was 53.9% for bonds, 29.6% for chemical products, 16.4% for construction businesses, and 0.1% for others.

(1) Bonds

Bonds mainly manufactures and sells various adhesives, sealants, wax/double-sided tape, etc. for general household use, housing/building materials, and industrial materials both domestically and internationally. Furthermore, the subsidiary Sunrise mainly manufactures and sells construction sealants for detached houses and automotive sealants/adhesives. Wall Bond Industries manufactures and sells wallpaper adhesives.

(2) Chemical products

In chemical products, we purchase and sell petrochemicals, synthetic resins, industrial chemicals in general, and electronic functional materials, and our main business is a trading company-like business. It is a business that can be said to be the root of the company, but since profit margins are low, it is said that drastic reforms will be launched in the new medium-term management plan.

(3) Construction business

Since civil engineering adhesives and sealants manufactured by the company were transferred to “bonds,” the details of this business are construction contract businesses handled by the subsidiaries Bond Engineering Co., Ltd., Konishi Koei Co., Ltd., Kinki Reinforced Concrete Co., Ltd., and Kadomaru Construction Co., Ltd. They mainly undertake repair and reinforcement work for roads, railways, tunnels, bridges, etc. ordered from government offices, railway companies, road authorities, etc. In the case of the company, it utilizes unique construction methods that make use of its know-how and experience as an adhesive manufacturer, and is characterized by the fact that construction business subsidiaries specialize in carrying out repair and reinforcement work.

(4) Others

Other businesses are developing real estate leasing businesses. Previously, both sales and profit were minimal, but since the head office building was acquired and part of it was leased, the proportion of profit was fixed.

2. Market share and competitors

For synthetic adhesives, which are the main products, the market share based on production volume is estimated to be at a level of over 10%, and there has been a slight upward trend in the past few years. Also, the market share on a monetary basis is estimated to be 12 to 13% (excluding construction sealants), making it the top share in both quantity and price in Japan.

Major competitors include Cemedine Co., Ltd., for general household use, Aika Kogyo (4206), and Oshika Co., Ltd., mainly for housing-related use. It competes with Sika Hamatite Co., Ltd. and Sunstar Giken Co., Ltd. in construction sealants. For construction and civil engineering, it competes with Show Bond Materials Co., Ltd. when it comes to adhesives, but at actual construction sites, it looks like the subsidiary Bond Engineering competes with Show Bond Construction Co., Ltd. Also, major competitors include Resonac Holdings (4004), Henkel Japan Co., Ltd., and Osika for factory production. Also, it competes with Cemedine and ThreeBond Co., Ltd. for the production of electronics products, but when expanding to double-sided tape, Nitto Denko (6988) and 3M Japan Co., Ltd. can be cited as competitors.

3. Characteristics and strengths

(1) Brand power

The company's greatest strength is the brand power of “bonds.” Many people know the name “bond,” from “bonds for woodwork” for general households to “bonds” for construction and industry.

(2) Product lineup

Another characteristic of the company is that it has a rich product lineup. The number of items is over 3,000, with only products bearing the “Bond” brand, and the product lineup in the industry stands out domestically. Furthermore, the wide product lineup is also an advantage as a company's profit base.

(3) Strengths as an adhesive specialist

Many competitors (excluding cemedine) do not specialize in adhesives, and there are many chemical manufacturers. In other words, for competitors, adhesives are not their main business, but only one business. Compared to this, since the company is a manufacturer specializing in adhesives, trust from customers is strong. This is also a characteristic of the company, and it can be said that it is an advantage.

(Written by FISCO Visiting Analyst Noboru Terashima)