| Valuation method | Value, ¥ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 1396.22 | -13 |
| Intrinsic value (DCF) | 900.23 | -44 |
| Graham-Dodd Method | 964.24 | -40 |
| Graham Formula | 106.05 | -93 |
Sumiken Mitsui Road Co., Ltd. is a leading Japanese construction and engineering firm specializing in infrastructure development, including roads, airports, ports, and community facilities. Founded in 1948 and headquartered in Tokyo, the company operates as a subsidiary of Sumitomo Mitsui Construction Co. Ltd. Its diversified business model encompasses design, construction, and maintenance services, alongside waste management, real estate, and renewable energy solutions like solar power generation. With a strong presence in Japan’s industrials sector, Sumiken Mitsui Road leverages its expertise in civil engineering, landscaping, and construction materials to serve both public and private clients. The company’s integrated approach—combining construction, environmental remediation, and facility management—positions it as a key player in Japan’s infrastructure modernization efforts. Its subsidiary status under Sumitomo Mitsui Construction provides additional financial stability and access to large-scale projects.
Sumiken Mitsui Road presents a stable investment opportunity within Japan’s engineering and construction sector, supported by its diversified revenue streams and strong parent-company backing. With a market cap of ¥13.3 billion and modest beta (0.051), the stock may appeal to risk-averse investors seeking exposure to infrastructure development. However, its low net income margin (~1.9%) and modest EPS (¥64.01) suggest limited profitability scalability. The company’s solid cash position (¥11.2 billion) and low debt (¥33 million) provide financial flexibility, while a ¥40/share dividend indicates shareholder returns. Risks include reliance on Japan’s domestic construction market and exposure to public-sector spending cycles. The renewable energy segment (solar power) offers growth potential but remains a small contributor.
Sumiken Mitsui Road’s competitive advantage lies in its vertical integration—spanning construction, materials manufacturing, and environmental services—which allows it to control project timelines and costs. Its specialization in road and pavement engineering differentiates it from general contractors, while its waste management and solar power divisions add resilience against construction downturns. As a subsidiary of Sumitomo Mitsui Construction, it benefits from shared resources and bidding power for large infrastructure projects. However, its regional focus (Japan) limits geographic diversification compared to global peers. The company’s small scale relative to industry leaders may restrict its ability to compete for mega-projects independently. Its strengths in niche areas like soil remediation and asphalt production provide sticky customer relationships but face competition from specialized firms like Taisei Corporation and environmental service providers. The reliance on public works contracts also exposes it to political budget fluctuations.