12 minYour Investment Soundtrack: The Companies Behind BL Equities Japan – Part 1
When it comes to investing, there’s never a shortage of noise—constant market updates, countless opinions, and promises of quick profits. It’s easy to get caught up in the buzz and lose sight of what investing truly means: owning real businesses that create lasting value over time.
Over the past decade, the growth of passive investing has made it easier to overlook company fundamentals, as investors increasingly focus on markets rather than businesses.
At BLI, we take a different path. We invest in companies, not indexes. We look for businesses with clear strategies, strong cash flow generation, and enduring competitive advantages—whether derived from technological expertise, customer loyalty, network effects, cost leadership, or great brands. We focus on disciplined valuation and let time do the compounding. As Warren Buffett reminds us, “Time is the friend of the wonderful business, the enemy of the mediocre.”
“Time is the friend of the wonderful business, the enemy of the mediocre.”Warren Buffett
This article is written first and foremost for investors in our Japanese equity fund—but also for anyone curious about how we invest and what we believe in. It’s about understanding the businesses in your portfolio and the key elements that drive each investment decision. Investing isn’t about lines on a screen; it’s about real companies creating the products and services people rely on every day.
You’re likely using products from your Japanese investments without even realizing it. Your smartphone, for instance, was assembled by Japanese automation equipment and runs on chips made with Japanese semiconductor technology. Other portfolio businesses come into view when you visit a hospital and see diagnostic devices, ride a bicycle, watch your kids play video games, notice contractors using power tools and machinery, or add a splash of soy sauce to your meal. These aren’t abstract investments—they’re real businesses generating real returns.
Our approach begins with individual companies, but we don’t view them in isolation. We seek businesses benefiting from powerful structural trends—fundamental shifts that create long-lasting tailwinds for well-positioned players. These structural drivers shape how we identify and evaluate investment opportunities and will also guide this upcoming article series. In the weeks ahead, we’ll explore your portfolio holdings through the lens of these themes, each paired with a rock song that helps bring its story to life.
Let’s start with the first two tracks on our investment soundtrack, both centred around evolving demographics. Demographic change is reshaping the global economy—urbanization, shifting family structures, evolving education, and changing work patterns all play a role. Two forces stand out for Japan: aging populations driving higher demand for healthcare, and shrinking workforces accelerating automation. These trends reinforce each other—as societies age, they need both better healthcare and smarter automation to sustain productivity. Your portfolio holdings in healthcare and industrial automation are well placed to benefit from these demographic shifts.
Alive
Healthcare Innovation and Medical Technologies
When Pearl Jam released “Alive” in 1991, they told a story about personal revelation and the struggle to live with difficult truths. Over time, listeners transformed it into an anthem of endurance — a reminder that being “alive” means continuing on in the face of adversity. This message connects well with today's healthcare innovation landscape, where advancing medical technologies are extending and improving lives in meaningful ways. From innovative drugs over improved diagnostics to minimally invasive treatments, your Japanese companies are helping patients recover and maintain better health - embodying that same determined spirit captured in Eddie Vedder’s memorable chorus on the fight for survival…
Terumo is Japan’s medical equipment giant—think of them as the company behind much of what you’d encounter in a hospital visit. They make the catheters and introducer sheaths used to gain vascular access through arteries, the stents that clear blocked arteries, the blood bags and transfusion systems that save lives in emergencies, the insulin pumps that help diabetics manage their condition, and even the basic syringes and needles used in everyday medical care. From heart surgery to a simple blood draw, there’s a good chance Terumo equipment is involved in keeping you healthy.
💡 Did you know that when you donate blood at Luxembourg’s Red Cross, the machines extracting and processing your blood are made by Terumo?
Asahi Intecc takes a completely different approach—instead of Terumo’s broad portfolio, they’ve mastered one highly specialized niche. They make the ultra-thin medical wires that help doctors navigate through your arteries during heart procedures, particularly when you need a stent to open blocked blood vessels. Think of them as the company that perfected turning basic steel wire into incredibly precise medical tools. If you ever need this type of heart procedure in Europe, there’s a 50% chance the guidewire helping save your life comes from Asahi Intecc.
💡 Did you know that in 1995 a Japanese cardiologist partnered with Asahi Intecc to develop the world’s first guide wire for completely blocked coronary arteries, achieving what the medical world deemed impossible?
Daiichi Sankyo Daiichi Sankyo is a company you hope you never need. They’re a pharmaceutical giant specializing in cancer treatments, particularly a breakthrough technology that works like a precision delivery system against tumours. Their innovative approach combines an antibody that seeks out cancer cells with a powerful chemotherapy drug attached to it—think of it as a targeted delivery system that hits cancer while sparing healthy cells. Their star treatment, Enhertu, is transforming breast cancer care and giving patients hope where traditional treatments have failed.
Sysmex makes the machines that analyse your blood when you get lab work done. They’re the world leader in equipment that counts and examines your red and white blood cells, helping doctors diagnose everything from infections to more serious conditions. What makes them particularly attractive as an investment is their “razor and blade” business model—once a lab buys their machine, they need to keep purchasing Sysmex’s specialized chemicals and maintenance services. It is just like buying a printer: the real money isn’t necessary in selling the device, but in the ongoing ink cartridge sales.
💡 Did you know that when you get blood work done at any of Luxembourg’s three leading diagnostic labs, your blood cell analysis is performed using Sysmex machines?
Hoya perfectly demonstrates how specialized expertise can serve multiple markets. Best known as the world’s second-largest eyeglass lens maker, it also produces contact lenses, surgical endoscopes, and artificial lenses for cataract surgery. Their glass-making mastery extends well beyond healthcare: its ultra-precise plates are used to “print” semiconductor patterns onto silicon wafers, and it supplies the glass disks used in traditional hard drives. So, whether you're getting your vision corrected or using any electronic device, Hoya’s specialized glass technology is likely involved. Looking ahead, aging populations will boost its medical business, while digitalization and chip miniaturization keep IT demand strong. Classical HDDs aren't going anywhere either as tech giants like Amazon or Google still need that reliable, cheap storage for their massive data centres.
Fujifilm pulled off one of business's greatest reinventions. When digital cameras killed film photography, they could have disappeared like Kodak. Instead, they asked the right question: what else can we do with our film-making expertise? Turns out, a lot. The same technologies that made perfect photo film now create medical imaging equipment, help develop new drugs, and produce high-tech materials for electronics. Their chemistry knowledge became bioengineering prowess, their precision coating techniques now serve healthcare diagnostics. Meanwhile, their cameras and Instax instant photos keep the imaging legacy alive. Fujifilm proves that when your industry dies, the smartest move isn't fighting change—it's transforming your core skills into something completely new.
💡 Did you know that Fujifilm pioneered digital radiography, introducing the world’s first system in 1983 and setting the stage for modern medical imaging?
Industrial Disease
Innovating Production through Process Automation
When Dire Straits released “Industrial Disease” on their 1982 album Love over Gold, they painted a sharp, satirical portrait of a society grappling with the consequences of unchecked industrialization. Today, that vision echoes in a world transformed by robotics and automation—from manufacturing floors to commercial kitchens—driving efficiency, reshaping processes, and redefining how work gets done. What once seemed like a threat has become necessity: with aging populations shrinking the workforce, automation is no longer about replacing humans, it’s about enabling them. Across our portfolio companies, this transformation is sparking innovation and unlocking new possibilities in modern industry...
Hoshizaki brings process automation and optimization to commercial kitchens, from self-managing ice production and refrigeration to fully automated beverage dispensers. While you might not think about it, every cold drink, fresh ingredient, and perfectly chilled dish depends on reliable kitchen equipment working behind the scenes – a game-changer for an industry facing chronic labour shortages. As Japan's largest commercial kitchen equipment maker, they've built something rare in business: a 400-branch service network that can fix almost any kitchen equipment within a day, even competitors' products. For restaurant owners, that kind of reliability is worth paying for—downtime in a commercial kitchen means lost revenue.
Fanuc is the world's largest maker of industrial robots—their signature yellow robots are hard to miss on factory floors worldwide. They produce everything from the robotic arms that weld and assemble products to CNC systems controlling precision machining and robomachines handling complex manufacturing. What sets Fanuc apart is their ruthless business focus—they invest aggressively in innovation and expansion, even while sitting on substantial cash reserves. One area they're pushing hard into is cobots—collaborative robots designed to work directly alongside humans rather than behind safety cages. With their systems already dominating factories worldwide, Fanuc's combination of proven reliability, continuous innovation, and global service network keeps them leading the pack as manufacturers race to automate their way out of labour shortages and cost inflation.
💡 Did you know that Fanuc's European headquarters and distribution centres are in Luxembourg, handling everything from repairs to logistics for the entire continent?
Daifuku is the invisible force behind the scenes whenever you order something online, fly somewhere, or buy a car. They build the automated systems that move stuff around—from e-commerce warehouses dispatching your packages to airport baggage systems and car factory assembly lines. They're also crucial in semiconductor manufacturing, creating the ultra-clean environments needed to make computer chips. Essentially, if there's a process that involves moving things efficiently from point A to point B, there's a good chance Daifuku designed the system that makes it happen seamlessly.
Keyence makes factories smart with sensors and cameras that act like the eyes and brain of manufacturing lines, instantly detecting defects, reading barcodes, and ensuring perfect positioning. What makes them one of the world’s most profitable industrial companies isn’t just their technology—it’s their “fabless” business model. Unlike competitors who own expensive factories, Keyence focuses purely on design and innovation, outsourcing all manufacturing to specialized partners. They pay among Japan’s highest engineering salaries to attract top talent, resulting in remarkable innovation: 70% of their new products are world or industry firsts. This approach lets them capture premium prices while maintaining industry-leading profit margins through breakthrough solutions competitors can’t match.
💡 Did you know that Keyence displays dinosaur fossils at their headquarter as a reminder to staff: strive to be the most innovative company or risk extinction?
SMC makes the muscle behind factory automation—pneumatic systems that use compressed air to push, grip, and turn things with incredible precision. Think of them as the company that replaces human hands in manufacturing, using air pressure to perform repetitive tasks that need to be done exactly the same way, thousands of times a day. Whether it's assembling your smartphone, building your car, or packaging your food and medicine, SMC's air-powered systems are likely working around the clock to ensure consistent quality and speed that human workers simply can't match.
The Complete Setlist
We have seen that from healthcare to automation, your Japanese companies translate strength in innovation and manufacturing excellence into world leading positions. In the next part of this series, we’ll shift to the themes of infrastructure and the energy transition, and the companies poised to thrive in these fast-changing sectors.
Volume 1: Demographic Shift: Healthcare Innovation and Automation – available
Volume 2: Infrastructure Spending and the Energy Transition – available
Volume 3: The Digital Revolution – available
Volume 4: Evolving Consumer Trends - available on 27 November
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Written by Steve Glod, Fund Manager
BLI - Banque de Luxembourg Investments, an asset management company approved by the Luxembourg Financial Sector Supervisory Commission (CSSF)
Final date of writing: 29 October 2025.
Publication date: 06 November 2025
The companies mentioned in this article are all held in the BL Equities Japan Fund managed by the author at the time of writing. As the Fund is actively managed, its composition is subject to change over time; the companies mentioned in this article may leave the portfolio depending on subsequent investment decisions made by the manager.
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