Listing on the Tokyo Stock Exchange and taking the name SMC (1987)

Going public not before the money was needed, but after it no longer was

Read the December 1987 listing as a way of raising growth capital and the explanation does not fit. The month after it, president Omura Susumu said the $195.1M (¥25bn) of domestic capital expenditure planned through the year to March 1992 could be covered out of profit and depreciation alone. A 42% domestic share and an ordinary profit margin of 11–13% were built first; the flotation was placed after them. The preparation, running some five years from around 1982, was not a scramble driven by need for money but the procedure by which a company whose model had already set put its external credentials in order.

That said, the view that it could fund itself rested on the high margins of that moment and was conditional. Holding 240,000 items in order to meet short delivery times means leaving money tied up in plant and inventory indefinitely, and once the localization of overseas production is counted, the investment does not stop at the $195.1M (¥25bn) planned for Japan. Within little more than three years of the listing, the Kamaishi plant and the Tsukuba technical centre had been added. The meaning of standing on the capital market lay less in the amount raised than in securing, in advance, the room never to have to stop investing.