Okamoto Industries (5122 JP) is a family-run household products and industrial materials company based in Japan. The company is best known for its condom business, which ranks as the #3 globally. The brand name is strong in Asia, where Okamoto dominates the premium segment. The operating margin for Okamoto’s condom business is around 30%, and it has a clear technological leadership that protects it from the competition.
Deeper Chinese condom penetration could see the shares explode. With current penetration only 10% deep—vs 50% in HK—we are likely seeing just the tip of opportunity for a company that could grow for a long time to come.