[Company analysis] Showa Shell Sekiyu K.K. (昭和シェル石油)

「Showa Shell Sekiyu K.K. (昭和シェル石油)」 is a Japanese coal-related company, and until December 18, 2016, 「Royal Dutch Shell」was the largest shareholder. However, their entire stock was sold to「Idemitsu Kosan(出光興産)」in 2019, making it a wholly owned subsidiary of「Idemitsu Kosan」. As a result, it was delisted on March 27, 2019 and was removed from Nikkei 225. 「Showa Shell Sekiyu K.K.」 has a total of four refinery factories and has 4,900 affiliated service stations in Japan.

 

1. Company Profile

2. Summary and Features

3. Major Business

 

 

 

1. Company Profile

 

※Unit is JPY million, as of 2019

Company name	Showa Shell Sekiyu K.K.
Company name (Japanese)	昭和シェル石油
Date of establishment	May 16, 1949
Headquarters location	〒135-8074 東京都港区台場二丁目3番2号
Capital	34,198
Consolidated sales	2,045,936
Consolidated operating profit	78,477
Consolidated total assets	1,038,882
Consolidated capital	275,451
Capital adequacy ratio	26.5%

 

 

 

2. Summary and Features

 
Since the 2000s, Japan's oil business entered the restructuring period. The demand from Japanese market itself became clearly limitted, so foreign-affiliated companies such as「Exon Mobil」decided to withdraw. This tendency was further accelerated by the 2009 Energy Supply Structure Advancement Act.

In the first place, in the oil industry, product differentiation is extremely difficult and the competitive advantages are determined by the economies of scale of large facilities. Therefore, the larger the scale, they get better advantages. From this logic, the 2017「JXTG Holdings, Inc.」was born.

The market share of「JXTG Holdings」in Japan was about 50%. To counter this,「Showa Shell Sekiyu」concluded a business integration with「Idemitsu Kosan」on July 10, 2018. As a result, as of April 1, 2019,「Showa Shell Sekiyu」 was merged with「Idemitsu Kosan」, and their shares also was released on March 27, 2019. 

 

 

 

3. Major Business

 

■ Oil business
This was the core business of「Showa Shell Sekiyu」, which accounted for approximately 96.5% of total sales.

 ■ Real estate business

 ■ Solar business
Based on the surplus electricity purchase policy of the 2009 Democratic Party government, they have actively promoted the solar power business, including the operation of the world's largest factory (900 MW) with a single factory for the annual production capacity in 2011.