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Oji Holdings Corporation: Natural diversification into renewable energy

Published: May 2013 · Publisher: MarketLine
Oji Holdings Corporation (Oji Holdings, Oji or ‘the group’), formerly known as Oji Paper Co., Ltd., primarily manufactures and supplies newsprint, specialty papers and other paper products in Japan.
Report Type Case Studies
Language English
Format Electronic (PDF)
Pages19
Frequency Updated Annually
Availability Will be emailed within 1 business day
Reference No. 0109-6143
Price € 369,00
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Introduction

Oji Holdings Corporation (Oji Holdings, Oji or ‘the group’), formerly known as Oji Paper Co., Ltd., primarily manufactures and supplies newsprint, specialty papers and other paper products in Japan. However, faced with domestic competitive pressures and a difficult socio-economic climate, the group has felt the need to diversify its operations, and plans to engage with the renewable energy sector.

Features and benefits

* The publisher's Case Studies describe topics such as innovative products, business models, and significant company acquisitions.
* Fact-based and presented in an accessible style, they explain the rationale of commercial decisions and illustrate wider market and economic trends.

Highlights

In spite of a fairly diversified product offering within the paper industry, Oji Holdings has a distinct overreliance on its domestic market. This, coupled with the fact that the respective markets within which the company operates are shrinking, means that the group needs to explore alternative revenue streams.
As a result of the Fukushima disaster, the Japanese government initiated an incentive program for producers of renewable energy, a market that is set to take off in Japan in the coming years, and offers a potential area for diversification for Japanese conglomerates, such as Oji, that are feeling the effects of the prolonged economic downturn.
The group has announced plans to invest significantly in two biomass plants in order to take advantage of a governmental incentive system. This marks an attempt by Oji to boost profitability in the coming years, as it looks to leverage its extensive capital base and existing facilities.

Your key questions answered

* Why does Oji Holdings Corporation need to diversify its operations, and what pressures is it facing?
* What has been the effect of the earthquake and tsunami of March 11, 2011, on Japanese manufacturing and the country's energy sector?
* Why is Oji Holdings Corporation investing in renewable energy, and how is it able to do so?
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OVERVIEW
Catalyst
Summary
OJI HOLDINGS: WEAKNESSES
Oji Holdings’ revenues are highly concentrated
The Japanese paper industry is floundering
Increased rivalry and the need for diversification
OPPORTUNITY IN THE WAKE OF DISASTER
The earthquake shook Japan’s industrial production
The energy market was also hit
Government incentives offer an opportunity for growth
OJI AND THE RENEWABLE ENERGY MARKET
Oji already has environmental concerns
Oji has in-house power generation facilities
Key biomass fuels are run-of-the-mill by-products for Oji
Oji plans significant renewable energy investment
CONCLUSIONS
Renewable energy is an organic diversification for Oji
APPENDIX
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Copyright © FriedlNet. You may share using our tools Please don't cut content from FriedlNet and redistribute by email or post to the web.