Materials specialist JSR transforms Tokyo-centric business into a global enterprise
Company looks ahead to a thriving business relationship in the region
Country Business Reports interviews and articles by Discovery Reports www.discoveryreports.com
For almost 20 years, Tokyo has served as JSR’s headquarters for its liquid crystal display (LCD) materials business. In October last year, the materials specialist relocated its central office for LCD materials division to Shanghai. The move was not a simple change in business address, but actually part of a major transformation from a Tokyo-centric mindset to a globally oriented business model.
“We foresaw the trend in LCD demand that is already happening now. We have always thought that visual technology is moving more towards the eastern part of Asia, particularly China,” says Nobu Koshiba, president of JSR. “Now is really the time for us to adapt to changes in the business environment and transform the company into a truly global enterprise.”
With accumulated technical know-how, the company also produces synthetic rubber used in eco-friendly tyres. JSR similarly supplies other petrochemical products and fine chemicals, and has built a worldwide reputation for the development and production of photoresists used in manufacturing semiconductor components. More recently, JSR ventured into the life sciences segment, initially focusing on the North American market.
Koshiba is bullish about JSR’s strong focus on Asia. The group’s overall sales to China, for example, have grown from only 9 per cent of total revenues in 2014 to around 13 per cent last year. “We really like how the Chinese government has been promoting hi-tech products and industries,” Koshiba says. “We are highly interested in exploring business opportunities on the mainland by offering differentiated products and technologies.”
Aside from premium LCD materials, the company would also like to contribute in lowering Asia’s CO2 emission levels by offering its green products to the region. JSR has developed lithium ion capacitors to support the power requirements of bigger electric vehicles such as buses, trucks, construction machines and cars.
JSR has also expanded its production capacity for solution polymerised styrene-butadiene rubber (S-SBR) used in manufacturing eco-friendly tyres. The company’s S-SBR plant in Thailand has begun operations, and JSR expects to complete the second phase of the facility expansion by the end of next year. By providing superior gripping power and rolling resistance, the S-SBR innovation helps cut vehicle fuel consumption.
“While the Asian market is sure to drive our revenue growth, we look to North America for long-term success and sustainability,” Koshiba says. “We foresee life sciences to account for a larger 20 per cent of JSR’s overall revenues before 2020 as we target the field relevant to personalised medicine.”
To this end, JSR acquired KBI Biopharma of North Carolina in April last year. A contract manufacturer for large pharmaceutical companies, KBI offers the development and manufacture of specific molecules for drugs such as antibodies.
“We are helping pharmaceutical companies establish more advanced and competitive development and manufacturing processes,” Koshiba says. “We have plans of going beyond being a simple component materials supplier to a company that provides service.”
Including JSR’s purchase of a company specialising in diagnosis and autoimmune diseases, overall resources allocated to life sciences grew from 2 billion yen (HK$136.4 million) in 2013 to 20 billion yen last year.
“We are looking for potential acquisitions even outside the life sciences business,” Koshiba says. “Now that markets and technologies are changing faster than before, these acquisitions will play an important role in how we will grow the business and deliver technologies to our customers. We have enough demand to sustain our momentum, and we have prepared the company well for the non-linear growth ahead of us.”