Foreign ownership in Sumitomo Osaka increases

Foreign ownership in Sumitomo Osaka increases
13 December 2005

Overseas investors increased their stake in Sumitomo Osaka Cement Co to 33.7 per cent as of Sept. 30, up 4.7 percentage points from March 31, marking the first time the foreign stake in the company has surpassed 30 per cent.  The cement manufacturer’s shares has garnered attention largely due to forecasts that domestic demand for cement will rise in fiscal 2005 for the first time in five years. This is a result of emergency recovery works in the Hokuriku region of northwestern Japan and the southern island of Shikoku, areas that have been hit by natural disasters. 
Buying by overseas investors has also underpinned the rise in the cement manufacturer’s stock price. Its share price has surged 43 per cent from the end of 2004 to the close of trade Monday, exceeding the 37 per cent rise in the Nikkei Stock Average.  
"The stock’s rise is not as impressive" as the 99 per cent jump for Taiheiyo Cement Corp said Yusuke Ando, a senior analyst with Daiwa Institute of Research. "But its healthy financial state is likely to attract buyers, leaving room for the stock price to rise further." 
For the fiscal year ending March 2006, the company is expected to report a consolidated operating profit of 14 billion yen (US$116.4m), up 13 per cent on the year.  Cost-cutting efforts such as trimming production costs have resulted in a turnaround in its profit margin, while the bottom line has also been boosted by increased sales of cement.  Published under Cement News