Japan’s latest IPO, Tokyo Metro Co., has unveiled its business strategy, stating that it is planning to expand through mergers and acquisitions, along with investment.
Akiyoshi Yamamura, president of Tokyo Metro, said in an interview on Nov. 20 that the listing in the stock exchange opens more possibilities for the company, following by gaining trust by its partners. As the name indicates, the company’s main focus is on the rail business, but the president has disclosed that other segments such as real estate and distribution must be enhanced as well.
The company IPO, which is Japan’s largest since SoftBank Corp. was listed in 2018, caught the eye of international investors, gaining around 40% in share price, which suggests that the company is growing after recovering from the Covid-19 pandemic, said Yamamura.
The company is arranging around 30% of its JPY 100 billion ($646 million) of annual capital expenditure for expansion, particularly in real estate acquisition.
Earlier this month, Tokyo Metro reported its net income from the six-month period ended in September surged 27% to JPY30.7 compared to the same period the previous year. The revenue increase from passenger transport is a result of the revitalization of Japan’s economic activity boosting profits.
80% of the company’s operating profit comes from the railway sector, which is profiting JPY 50.1 billion.
Tokyo Metro, as part of a consortium, will soon take over London’s flagship subway line in the UK, said London’s transport operator.
The London project would contribute to both revenue and profits, although this would be the first time Tokyo Metro operated another company’s line, said Yamamura.
