Investing in Japan: Konica Minolta could be a good investment destination for value investors

-

Konica Minolta has suffered shrinking sales due to COVID-19

Konica Minolta, Inc. manufactures multi-functional peripherals, laser printers, digital color printing systems, inkjet print heads and inks, as well as print and cloud services. 

It is one of the largest Japanese electronics companies with more than 44,000 employees in its group. Although Konica Minolta is headquartered in Tokyo, it has also expanded production bases in the Chubu region such as Toyokawa City, Aichi Prefecture. 

As the demand for printing at offices is decreasing due to the spread of new coronavirus infection, Konica Minolta has been facing the challenge of shrinking sales and seeking new strategy to secure revenues by providing services and products other than office equipment. 

For this reason, the company is expanding services connecting office related products with servers and software to support the IT conversion of companies by providing multifunction devices, IT services, and IT maintenance and operation.

Konica Minolta is expanding provision of ICT services

Recently Konica Minolta's stock price has plummeted to the almost lowest level in two decades because of recent terrible financial results.  Its consolidated net sales are stagnant at 996.1 billion yen for FY2019 (down 6.0% year on year). 

Konica Minolta could be a good investment destination for value investors

Sales of office products decreased in China and North America due to the spread of the new coronavirus. For Konica Minolta, whose sales outside Japan accounts for 80%, the global spread of infection was a major blow causing the final loss of 3 billion yen. 

Konica Minolta could be a good investment destination for value investors

The company estimates that the impact of new coronavirus infections on consolidated sales reached around 23 billion yen. The impact of infections from April to June is expected to be greater than that of January to March. 

As economic activities have resumed, the second wave is concerned and situation will remain unpredictable for the time being. For this reason, the company could not disclose forecast of its financial results for March 2021. 

With medium-term perspective that its mainstay business manufacturing office related equipment cannot avoid the effects of decreasing printing volumes, Konica Minolta is expanding the provision of ICT services for new working styles such as remote work where demand is expected to grow after the outbreak. 

In addition, Konica Minolta also receives high evaluation in bio-healthcare field for its genetic testing technology and will increase further the number of testing contracts. Konica Minolta has incurred profit plunging brought by COVID-19 now, but it may turn those difficulties into opportunities to grow further. If so, Konica Minolta will be a great investment destination for value investors.

Konica Minolta could be a good investment destination for value investors


Comments

Post a Comment

Popular posts from this blog

Food and Drinks: Kaiten-sushi serves fresh and high quality of seafood

-
Image
Conveyor belt sushi , also known as Kaiten-sushi is a semi-self-service type, inexpensive sushi restaurant where small plates bringing various types of sushi on them are continuously circulated on chain conveyors installed along the seats.  Fresh and well-made sushi can be enjoyed for relatively cheap prices there. Plates typically come with one or two sushi pieces each and customers pick up plates they like. Customers can also place orders through a touch screen at each table when sushi they like is not available on conveyor belts.  Those Sushi are usually served on plates with several colors showing their prices ranging from 100 yen to around 500 yen. Some restaurants set the same price for all plates. The lowest price for a plate is usually 100 yen. That is why Kaiten-sushi is often called "100 yen sushi" and very popular among Japanese. Customers are given their bills from a staff who counts plates when they finish eating. Kaiten-sushi has grown thanks to technologie...
Read more

Investing in Japan: Menicon, a leading Japanese contact lens manufacturer, aims overseas market expansion

-
Image
Menicon secured profit growth amid COVID-19 disruptions Menicon Co., Ltd. is a leading contact lens manufacturer in Japan founded in 1951, headquartered in Nagoya. It consistently develops, manufactures and sells contact lenses and related products in-house. To date, Menicon has developed various types of contact lenses such as hard lenses, soft lenses, disposables (disposable), lenses for astigmatism and bifocal lenses. It has the No. 1 market share for hard lenses and the No. 2 market for soft lenses in Japan.  As for the recent consolidated financial results, Menicon announced that net income for the fiscal year ended March 31, 2020 was 4 billion yen, up 14% from the previous year. While the sales and profits of most Japanese companies fell sharply due to the spread of new coronavirus infections, Menicon increased its sales by 4.5% from the previous year to 84.5 billion yen, a record high for the fifth consecutive year since listing of its stock. On the other hand, the earning...
Read more

Investing in Japan: Toyota shows its strength shrugging off pandemic damage and semiconductor shortage

-
Image
COVID-19 cases rise in Japan amid state of emergency, Tokyo Olympics and Paralympics to be downsized The Japanese government has decided to add three prefectures to its state of emergency as coronavirus cases continue to rise.   Prime Minister Yoshihide Suga said on May 14 that he decided to expand a COVID-19 state of emergency covering Tokyo and other areas to three more prefectures as infections continue to surge ahead of the Summer Olympics.  Starting on May 15, it will cover Hokkaido, Okayama and Hiroshima in an effort to curb infections and ease the strain on medical systems. The government will also designate three more prefectures as areas where intensive virus measures should be taken which is often called “Manbou”, acronym in Japanese for quasi-emergency to contain the virus.  Daily new cases have been on the rise nationwide in recent weeks reaching more than 6,000 for the fourth straight day as of May 14. The recent spike in new cases forces the organizers of ...
Read more