Daido Steel

Basic Information

Stock Code
5471
Industry
Steel
Category Detail
Iron, Steel & Metal Products
Prefecture
Aichi Prefecture
Establishment Year
February 1950
Listing Year
September 1950
Official Website
https://www.daido.co.jp/
TSE Information
TSE Information
Yahoo! Finance
Yahoo! Finance
Other Companies
Takasago Tekko, Mori Kogyo, Nippon Koshuha Steel, Nippon Yakin Kogyo, Aichi Steel, Tohoku Special Steel, Nippon Kinzoku, Shin-Nippon Denko, Mitsubishi Steel, Nippon Seisen, Daido Metal

Overview

Daido Steel is a special steel manufacturer established in 1950, a leading industry player with significant global market share primarily in the automotive and aircraft parts sectors.

Current Situation

Daido Steel recorded consolidated sales of approximately 581.3 billion yen and ordinary income of approximately 45 billion yen for the fiscal year ending March 2024, maintaining a stable financial foundation. Special steel materials, its main product, account for about 60% in the automotive sector, securing high market share in diverse industries such as aircraft engine parts. Operating with 64 companies including subsidiaries, it conducts multiple businesses such as functional materials, magnetic materials, and engineering to diversify market fluctuation risks. It actively invests in technology development, opening the Advanced Magnetic Materials Development Center in 2020 to strengthen the magnet field. It also focuses on environmental and safety measures, earning the Health Management Brand 2024 certification and addressing corrections for Waste Management Law violations. In 2024, it announced a medium-term management plan to promote production reforms and enhanced global expansion, positioning new technologies and market development as pillars of growth. Intensifying global competition and resource price fluctuations are medium- to long-term challenges, but it plans to respond through a diversification strategy.

Trivia

Interesting Facts

  • Approx. 30% world share in aircraft engine shafts.
  • Over 35% world share in mobile phone magnets.
  • Over 50% world share in HDD magnets.
  • Founded in 1916, a long-established company specializing in special steel.
  • The place name Daido-cho (Nagoya) originates from the company's Hoshizaki Plant.
  • Founder Momosuke Fukuzawa is a prominent Japanese businessman.
  • Daido Steel group consists of 64 companies with diversified businesses.
  • Overcame environmental law violation incident and focuses on environmental improvements.
  • Certified as Health Management Brand 2024, emphasizing employee satisfaction.
  • Own brand 'Daido' has high recognition in the industry.
  • Strong corporate sports teams in volleyball and handball.
  • Pioneering role in technological innovation in the special steel industry.
  • Strength in digital device field through proprietary magnetic materials technology.
  • Implements diverse social contribution activities rooted in the local community.
  • Has numerous domestic and international subsidiaries and affiliates.

Hidden Connections

  • Daido Steel has capital ties with Mizuho Bank and Nippon Steel as major shareholders.
  • Subsidiary Daido Electronics dominates the global market in mobile phone and HDD magnets.
  • Close transactions with automakers such as Toyota and Honda.
  • Company inheriting the lineage of Momosuke Fukuzawa's Daido Electric Power, with significant influence on local culture.
  • Deeply involved in the transition from Industrial Bank of Japan to Mizuho Financial Group.
  • Daido-cho Station on the Nagoya Railroad Chita Line named due to the company's influence.
  • Connections with Boeing etc. as a global supplier of aircraft engine parts.
  • Educational and research collaboration with Daido University (formerly Daido Institute of Technology).

Future Outlook

Growth Drivers

  • Increased demand for high-performance special steel due to electrification of automotive industry
  • Expansion of parts manufacturing from aircraft demand recovery
  • Growth in demand for IoT/5G products in magnetic materials
  • Shift to high-value-added products in response to strengthened environmental regulations
  • Enhanced competitiveness through optimization of global production bases
  • Promotion of digitalization and automation in production technology
  • New market development through new material development

Strategic Goals

  • Achieve 1 trillion yen in group consolidated sales
  • Realize environmental load reduction and carbon neutrality
  • Establish world top share in special steel field
  • Technological innovation and market expansion in magnetic materials
  • Continue health management and achieve over 95% employee satisfaction
  • Expand overseas business ratio to over 40%
  • Full automation and DX promotion in manufacturing processes

Business Segments

Automotive Parts Manufacturing

Overview
Provides high-durability and precise metal parts for automobiles.
Competitiveness
Strength in processing technology for high-performance special steel materials.
Customers
  • Toyota Motor
  • Honda Motor
  • Nissan Motor
  • Suzuki
  • Mazda
  • SUBARU
  • Mitsubishi Motors
Products
  • Turbocharger Parts
  • Hinges
  • Brackets
  • Metal Processed Products
  • Bearing Parts

Aircraft Parts

Overview
Manufactures high-share engine parts that support aircraft safety.
Competitiveness
Technological prowess and quality control with approx. 30% world share.
Customers
  • Mitsubishi Heavy Industries
  • Kawasaki Heavy Industries
  • Boeing
  • Airbus
Products
  • Aircraft Engine Shafts
  • Titanium Alloy Parts

Magnetic Materials for Electronic Devices

Overview
Stable supply of high-performance magnets for mobile phones and HDDs.
Competitiveness
High share dominance through collaboration with subsidiary Daido Electronics.
Customers
  • Mobile phone manufacturers
  • HDD manufacturers
  • Electronic component manufacturers
Products
  • Rare Earth Magnets
  • Hard Disk Magnets
  • Small Motor Magnets

Steel Materials Distribution/Services

Overview
Provides integrated distribution and customer services for group products.
Competitiveness
Extensive sales network and specialized technology.
Customers
  • General manufacturing
  • Construction
  • Industrial machinery manufacturers
Products
  • Distribution and sales of special steel materials
  • Technical support
  • Maintenance services

Industrial Machinery Parts Manufacturing

Overview
Manufactures and provides high-precision industrial machinery parts.
Competitiveness
Integration of processing technology and material development.
Customers
  • Machinery manufacturers
  • Manufacturing equipment companies
Products
  • Machine Parts/Mechanism Parts
  • Industrial Precision Parts

Engineering/Plant Construction

Overview
Design, construction, and maintenance of industrial plants.
Competitiveness
Technological capabilities to meet customer needs.
Customers
  • Chemical plants
  • Steel mills
  • Infrastructure-related
Products
  • Plant Design
  • Maintenance Services
  • Engineering

Competitive Advantage

Strengths

  • Advanced special steel manufacturing technology
  • Risk diversification through diverse business operations
  • Global share in aircraft parts
  • Strong customer base and trading partners
  • Close collaboration with subsidiaries
  • Long history and reliability
  • Active investment in technology development
  • Extensive domestic and international sales network
  • Thorough quality control system
  • Strong response in environmental and safety areas
  • Promotion of health management
  • Growth strategy based on medium-term management plan

Competitive Advantages

  • Outstanding market dominance in automotive and aircraft sectors
  • High share in magnetic materials through subsidiary collaboration
  • Stable revenue structure from broad business segments
  • Rapid supply system with multiple bases domestically and abroad
  • Development capabilities for high-value-added special steel products
  • Customer trust gained through stringent quality standards
  • Possession of advanced materials technology based on years of accumulation
  • Flexible response to diverse customer needs
  • Enhanced brand power through sustainability and health management initiatives
  • Synergy effects of technology and sales within the group

Threats

  • Demand fluctuations due to global economic uncertainty
  • Rising raw material prices and supply instability
  • Intensifying price competition from competitors
  • Financial risks from exchange rate fluctuations
  • Cost increases from strengthened environmental regulations
  • Impacts from political risks and trade friction
  • Risk of failing to keep pace with technological innovation speed
  • Competitive pressure from new entrants

Innovations

2020: Opening of Nakatsugawa Advanced Magnetic Materials Development Center

Overview
Opened a research and development facility for rare earth magnets using the latest technology.
Impact
Contributes to strengthening competitiveness in magnetic materials.

2022: Development of High-Performance Titanium Alloy for Aircraft

Overview
Developed new alloy for aircraft parts with high heat and corrosion resistance.
Impact
Contributes to expanding share in the global market.

2023: Promotion of Smart Factory for Production Efficiency Improvement

Overview
Promoting automation and efficiency of manufacturing sites using AI and IoT.
Impact
Achieved cost reduction and quality improvement.

2024: Introduction of Environmental Load Reduction Technology

Overview
Implemented waste treatment improvements and energy-saving technology to reduce environmental impact.
Impact
Contributes to improving regional environment and corporate image.

Sustainability

  • Certified as Health Management Outstanding Organization
  • Correction of Waste Management Law violations and strengthened environmental conservation
  • Introduction of ISO14001 environmental management system
  • Promotion of energy-saving equipment introduction
  • Support for Sustainable Development Goals (SDGs) through collaboration with local communities