| Valuation method | Value, ¥ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 405.85 | 19 |
| Intrinsic value (DCF) | 119.60 | -65 |
| Graham-Dodd Method | 386.75 | 13 |
| Graham Formula | 411.57 | 20 |
Mori-Gumi Co., Ltd. (1853.T) is a Japan-based civil engineering and construction company with a rich history dating back to its founding in 1934. Headquartered in Osaka, the company specializes in a wide range of construction projects, including roads, tunnels, railroads, flood control systems, and disaster recovery efforts. Additionally, Mori-Gumi engages in residential, public, transportation, welfare, and plant facility construction. Beyond construction, the company offers surveying, design, and supervision services, as well as the production and sale of pollution control equipment and secondary rock products. With a market capitalization of approximately ¥9.76 billion, Mori-Gumi operates in Japan's competitive engineering and construction sector, contributing to infrastructure development and urban planning. The company's diversified business model and long-standing expertise position it as a key player in Japan's industrials sector, catering to both public and private sector projects.
Mori-Gumi presents a stable investment opportunity within Japan's engineering and construction sector, supported by its diversified project portfolio and strong cash position (¥9.57 billion in cash and equivalents). The company's low beta (0.067) suggests minimal volatility relative to the broader market, appealing to risk-averse investors. However, its modest net income (¥685 million) and diluted EPS (¥20.92) indicate limited profitability growth. The dividend yield, based on a ¥14 per share payout, may attract income-focused investors, but the company's revenue (¥27.58 billion) and operating cash flow (¥680 million) reflect moderate operational efficiency. Investors should weigh Mori-Gumi's stable cash reserves against its relatively low growth prospects in a mature industry.
Mori-Gumi operates in Japan's highly competitive engineering and construction sector, where larger firms like Kajima Corporation and Taisei Corporation dominate major infrastructure projects. The company's competitive advantage lies in its niche expertise in disaster recovery and flood control projects, which are critical in Japan's disaster-prone geography. However, its smaller scale limits its ability to compete for mega-projects against industry giants. Mori-Gumi's vertically integrated operations—spanning design, construction, and materials production—provide cost efficiencies but may lack the technological innovation seen in larger peers. The company's strong regional presence in Osaka and surrounding areas offers localized market penetration, but its national reach is constrained compared to top-tier competitors. With a conservative financial approach (low debt at ¥827 million), Mori-Gumi prioritizes stability over aggressive expansion, which may limit growth but reduces financial risk in cyclical downturns.