[Company analysis] Obayashi Corporation (大林組)

「Obayashi Corporation(大林組)」is a Japanese general construction company established in 1892. This company was included Japan's big five general contractors(「Obayashi Corporation(大林組)」, 「Kajima Corporation (鹿島建設)」, 「Taisei Corporation (大成建設)」, 「Shimizu Corporation(清水建設)」,「Takenaka Corporation (竹中工務店)」). The number of consolidated employees is 13,432.

 

1. Company Profile

2. Summary and Features

3. Major Business

4. Financial Information

 

 

 

1. Company Profile

 

※Unit is JPY million, as of 2019

Company name	Obayashi Corporation
Company name (Japanese)	大林組
Date of establishment	Thursday, May 7, 1936
Headquarters location	〒108-6101 東京都港区港南二丁目15番2号
Capital	57,752
Consolidated sales	2,039,685
Consolidated operating profit	155,480
Consolidated total assets	2,214,512
Consolidated capital	798,149
Capital adequacy ratio	36.0%
Consolidated number of employees	13,432

 

 

 

2. Summary and Features

 
「Obayashi Corporation」 is said to be the most aggressive to expand overseas among the Japan's big five general contractors. In the past, they conducted many construction projects on the Korean peninsula during the colonial era. And 1962, after World War II, this company  received an order for the first overseas construction project. After that, it implemented a number of overseas construction projects, including「the Hoover Dam bypass project」in the United States, 「the Dubai metro project」in the UAE, and「the Sydney Olympic Stadium」in Australia.

Besides, in Japan domestic, they  also built several iconic buildings such as「Roppongi Hills」、「Tokyo Skytree」and even they got involved the work related to historic buildings such as repair work at Osaka Castle. 「Obayashi Corporation」has been headquartered in Osaka for many years since its establishment in Osaka, but in 2010 the headquarters in the registry was moved to Tokyo.

This company also has a top class construction technology. They even  built the world's first building that does not shake even with a seismic intensity 5 earthquake. As a paper plan, they even  envisioning a space elevator connecting the moon and the earth. As a scale of business,「Obayashi Corporation」has largest sales amonst Japan's big five general contractors. But it also can generate stable profits by operating not only its core business of construction but also real estate and related businesses from various perspectives.

However, it is also a company that is involved in many cases that are not very amusing. It is one of four construction companies that was found to have received an order for construction of a「Linear Chuo Shinkansen project(リニア中央新幹線)」for the「Central Japan Railway Company(東海旅客鉄道)」 due to illegal transactions. As a result, 「Obayashi Corporation」received a fine of 200 million yen and suspended business for 120 days from February 2, 2019 to June 11, 2019 for new civil engineering work.

 

 

 

3. Major Business

 

■ Construction business
The core construction business of 「Obayashi Corporation」is such as Offices, commercial facilities, factories, hospitals, schools, and other buildings that meet various needs such as earthquake resistance, disaster prevention, and comfort. They have built a number of projects that symbolize the era and culture, such as「Tokyo Station」、 「Roppongi Hills」、「Tokyo Skytree」.

■ Civil engineering business
This company also carry out construction of essential infrastructure such as tunnels, bridges, dams, railways and highways that are essential for people's lives. Recently, it is said that the quantity of projects related to renovation and maintenance / repair tends to be increased.

■ Development business
「Obayashi Corporation」 also conduct development business for their owns or rental properties with good location conditions, mainly in centre of Tokyo. They have many achievements in redevelopment projects in urban areas, and they are actively working on large-scale development projects.

■ New business
This company is also engaged in renewable energy, PPP, and agricultural businesses beyond the existing construction business.

 

 

 

4. Financial information

 

※Unit is JPY million

		2016	2017	2018
Consolidated sales		1,872,721	1,900,655	2,039,685
Consolidated operating profit		133,742	137,800	155,480
Consolidated total assets		2,015,996	2,148,861	2,214,512
Consolidated net assets		644,076	711,525	798,149
Breakdown of sales	Domestic construction	1,020,378	1,014,371	1,126,556
	Oversea construction	367,980	383,995	408,715
	Domestic civil engineering	332,374	346,119	351,372
	Oversea civil engineering	81,795	76,461	58,870
	Real estate business	38,795	44,566	49,105
	Others	31,400	35,141	45,064