| Valuation method | Value, ¥ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 1271.81 | 84 |
| Intrinsic value (DCF) | 1166.96 | 69 |
| Graham-Dodd Method | 1531.45 | 122 |
| Graham Formula | n/a |
Sakurai Ltd. (7255.T) is a Japan-based manufacturer specializing in precision machine tools and automotive components. Established in 1948 and headquartered in Hamamatsu, the company designs, develops, and manufactures high-precision parts for passenger cars, motorcycles, forklifts, and aerospace applications. Its product portfolio includes transmission cases, cylinder heads, valve bodies, and specialized machine tools for deburring, milling, and system integration. Sakurai serves both domestic and international markets, with a strong presence in Japan's automotive and industrial sectors. The company's expertise in precision engineering and diversified applications in automotive, aerospace, and general machinery positions it as a key player in the Consumer Cyclical sector. With a market capitalization of approximately ¥1.91 billion, Sakurai combines niche manufacturing capabilities with steady demand from Japan's industrial base.
Sakurai Ltd. presents a stable but low-growth investment opportunity, characterized by its niche specialization in precision automotive and aerospace components. The company's modest beta of 0.084 suggests low volatility relative to the broader market, appealing to conservative investors. Financials indicate steady revenue (¥5.54 billion) and net income (¥321.5 million), supported by strong operating cash flow (¥1.09 billion). However, high capital expenditures (¥549.96 million) and total debt (¥1.38 billion) relative to cash reserves (¥1.29 billion) may constrain near-term flexibility. The dividend yield is modest (¥10 per share), reflecting a cautious capital return policy. Investors should weigh Sakurai's entrenched position in Japan's auto-parts supply chain against limited international exposure and cyclical industry risks.
Sakurai Ltd. competes in the precision machine tools and auto-parts sector, leveraging its long-standing expertise in high-tolerance manufacturing. Its competitive advantage lies in specialized applications such as aerospace components and multi-spindle machining systems, which require advanced technical capabilities. However, the company faces intense competition from larger Japanese and global automotive suppliers with greater scale and R&D budgets. Sakurai's focus on niche markets (e.g., forklift parts, gas meter components) provides some insulation from mass-market price pressures but limits revenue diversification. The company's vertically integrated operations—from design to maintenance—enhance customer retention but may lag in cost efficiency compared to outsourcing-focused rivals. While its aerospace segment offers growth potential, reliance on Japan's automotive sector (approx. 60% of revenue) exposes Sakurai to regional demand fluctuations. Competitively, it occupies a middle ground between boutique precision engineers and industrial conglomerates, with differentiation rooted in customization rather than scale.