Daiwabo Co., Ltd. is shifting away from commodity products and strengthening its high-value-added strategy, leveraging proprietary technologies such as the combination of polypropylene and rayon staple fibers. “Our raison d’être lies in technologies that are not easily replicated by others,” the company states, emphasizing its integrated system that spans from fiber material development to product design as a key strength in its growth strategy.
Over the past 5 to 10 years, the company has focused on withdrawing from low-cost commodity products and moving closer to end-user markets. In March, it ceased production at its spinning subsidiary, Daiwabo Spintec. With bases in China and Indonesia, it has expanded into areas close to final products, such as innerwear. The era is no longer about large volumes, but about winning through uniqueness—creating value rather than chasing quantity.
The driving force behind its growth is the synthetic fiber and rayon business. Daiwabo Rayon Co., Ltd., Japan’s only manufacturer of rayon staple fibers, is a group company, and Daiwabo boasts one of the highest domestic production volumes of polypropylene staple fibers. The company is focusing on developing products with unique functionalities by combining these two types of fibers. Notably, its nonwoven fabric for face masks, which enhances lotion retention, has received high market acclaim. The recovery of inbound demand is also providing a tailwind.
In the first half of the fiscal year (April to September), the company’s performance was impacted by a slowdown in outdoor construction due to record-breaking heat, leading to sluggish sales of civil engineering materials. Additionally, rising prices dampened domestic apparel consumption. As a result, the company noted, “We may fall slightly staple of our plan, but profitability remains solid.” In the second half, the company expects a recovery driven by new product launches and inventory adjustments, aiming to meet its full-year plan for the fiscal year ending March 2026.
The current fiscal year marks the midpoint of its three-year medium-term management plan ending March 2027. The company plans to accelerate global expansion of functional rayon staple fibers, targeting markets in Europe, the U.S., and Southeast Asia from its base in Indonesia. It aims to increase its overseas sales ratio from 15.4% in the previous fiscal year to 20.8%, with a goal of reaching 23.2% in the next fiscal year.