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Boston, MA -- (SBWIRE) -- 07/25/2013 -- Oji Holdings Corporation (Oji Holdings, Oji or 'the group'), formerly known as Oji Paper Co., Ltd., primarily manufactures and supplies newsprint, specialty papers and other paper products in Japan. However, faced with domestic competitive pressures and a difficult socio-economic climate, the group has felt the need to diversify its operations, and plans to engage with the renewable energy sector.
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In spite of a fairly diversified product offering within the paper industry, Oji Holdings has a distinct overreliance on its domestic market. This, coupled with the fact that the respective markets within which the company operates are shrinking, means that the group needs to explore alternative revenue streams.
As a result of the Fukushima disaster, the Japanese government initiated an incentive program for producers of renewable energy, a market that is set to take off in Japan in the coming years, and offers a potential area for diversification for Japanese conglomerates, such as Oji, that are feeling the effects of the prolonged economic downturn.
The group has announced plans to invest significantly in two biomass plants in order to take advantage of a governmental incentive system. This marks an attempt by Oji to boost profitability in the coming years, as it looks to leverage its extensive capital base and existing facilities.
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Your key questions answered
- Why does Oji Holdings Corporation need to diversify its operations, and what pressures is it facing?
- What has been the effect of the earthquake and tsunami of March 11, 2011, on Japanese manufacturing and the country's energy sector?
- Why is Oji Holdings Corporation investing in renewable energy, and how is it able to do so?
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