In a year that saw India get its largest-ever IPO to date through LIC, Japan too witnessed one of its largest IPOs in 2022. That was for Daiei Kankyo, a waste management and recycling company headquartered in Kobe.
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Japan’s Newest Billionaire
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Last December, the company raised $315 million, offering over one-third of its shares, and listed on Japan‘s Tokyo Stock Exchange’s Prime Market. Daiei Kankyo
Daiei Kankyo Co. Ltd., which offers waste recycling and treatment services, rallied over 30% after going public through the IPO, after which the company’s co-founder and president Fumio Kaneko, has become the country’s newest billionaire with a net worth of $1 billion recently.
66-year-old Kaneko, along with three business partners, founded the company in 1979 in Izumi city, Osaka Prefecture, to manage waste. Despite facing initial resistance from local residents, Kaneko and his cofounders managed to convince the local government about the need for a permanent disposal site and obtained the required permits to construct one to handle nine different types of waste. That site has since been converted into a landscaped public park, as per a Forbes report.
Turning Point For the Company
A big turning point for the venture was in 1995 when the Great Hanshin Awaji earthquake caused massive damage in Kobe and Osaka. The company ended up handling one-third of all the earthquake waste, which strained its finances but helped to establish its credentials.
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Since then, Daiei Kankyo has expanded into waste recycling, power generation using waste, soil remediation and forest conservation. The company’s services include waste collection and transportation, sorting, crushing, recycling and final disposal at 61 facilities spread over five Prefectures. As of December 2022, the firm had a total capacity of 31.8 million cubic meters at all its final disposal sites.
The firm also operates waste biomass and biogas power generation plants and supplies heat to a hotel in Iga City for its natural hot spring facility. It produces renewable energy through solar power generation. Today, Daiei has more than 30 subsidiaries and affiliated companies with a workforce of 2,520 people, as per the report.
Daiei Kankyo has benefited from the increasing demand for waste management services as the pandemic effects weaken. In the financial year ended March 2022, it posted revenue of $500 million, logging a 5.5% increase from the same period a year earlier, with a net profit of $67 million. In the first nine months of the fiscal year 2023 ended December 2022, Daiei reported a net profit of $54 million on revenue of $375 million.
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