Daiwa Securities Group has set its sights on Australia for its first overseas expansion into the agricultural sector, part of a broader push to increase lending and direct investment in the country’s property and renewable energy sectors.
Japan’s second-largest brokerage is looking for investment or lending opportunities in what it sees as growers of value-added products, Chief Financial Officer Kotaro Yoshida said. The firm also focuses on lending to mid-market property developers, filling a market niche between Australia’s four biggest banks and non-bank lenders.
The renewed push in Australia comes as CEO Akihiko Ogino aims to increase revenue from outside Japan by about 40% in the coming years. It follows an earlier investment by the Tokyo-based company in the venture capital arm of Australia’s national science agency.
Japan’s long-term shortage of farm workers has spurred the industrialization of agriculture and provides a model for similar technological improvements for fresh produce farmers in Australia, Yoshida said. The broker could invest directly in these farms or provide loans.
“If they grow and we can bring them to Japan, that would be great,” Yoshida said in an interview last week after Daiwa’s first Japanese equities conference in Sydney and Melbourne. They can “cooperate with Japanese companies and grow further.”
The company plans to continue to focus on clean energy lending and advisory, leveraging its five employees in Sydney and Melbourne, Yoshida said.
Chairman Seiji Nakata told Bloomberg News last year that the company was looking to expand into Australia to take advantage of the country’s strong demographics and fast-growing pension fund.
Through its private investment arm Daiwa PI Partners, the company backed Main Sequence Ventures, the venture capital arm of the Australian Science Foundation, which has funded companies such as V2 Food, a producer of plant-based meat products.
