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Komatsu and the Farm and Construction Machinery Industry

Komatsu and the Farm and Construction Machinery Industry. Mod 4 John Rojo. The Company. Japanese manufacturer vehicles and machinery for construction, mining, and agriculture Includes excavators, backhoes, skid loaders, forest machines, forklifts, cutting lasers..

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Komatsu and the Farm and Construction Machinery Industry

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  1. Komatsu and the Farm and Construction Machinery Industry Mod 4 John Rojo

  2. The Company • Japanese manufacturer vehicles and machinery for construction, mining, and agriculture • Includes excavators, backhoes, skid loaders, forest machines, forklifts, cutting lasers.. • There is no specific farm equipment but many duel use products

  3. Key Financial Figures (All figures in million Yen) • Cash-93,620 • Total Assets 2,517,857 • Total Liabilities/ Equity- 1,265,162 & 1,252,695 • Net Sales- 1,884,991 • Operating Income- 211,602 • Net Income – 137,135 • To convert to dollars it is approximately 100 to 1

  4. Revenue All over the place -5 to 29%

  5. EPM Most are between 8-14%

  6. EATO Except for Joy all are Near 100%

  7. Assumptions The sales growth is high so I will lower it for the future

  8. WACC I got some info from Bloomberg and some from another class where we talked about International returns. The WACC is lower than the growth rate. The cost of debt Looks really low but maybe a result of deflation in Japan

  9. DCF

  10. Info • I move the WACC and growth rates • The WACC goes up using more normal inputs for cost of debt • The growth rate I lowered to 5% because the current rate will decrease as the developing markets slow their growth • It is affected by the WACC and growth rate being very close • All the numbers are in millions of Yens

  11. Possible alternatives • Better inputs for the future numbers • Better growth rates as construction manufacturing industry has very big peaks and valleys

  12. Questions

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