Research and Development

Research and development activities were almost entirely funded by the Company during fiscal 2017. Combined spending on research and development for
the Steel and Energy Products Business and the Industrial Machinery Products
Business amounted to ¥4,369 million (US$41 million).
Aiming to become a company that contributes to the prosperity of society
by generating changes through its innovative technologies, we strive todevelop new products and production techniques using our proprietary tech-Muroran Research Laboratory

nologies. To bring these products and techniques to market as soon as possible,
we actively promote multidisciplinary and technological tie-ups and jointdevelopment.
Our Research and Development Headquarters collaborates with businessdivisions and Group companies to 1) improve the capabilities, performance,and reliability of core products; 2) develop and nurture offerings in new business fields based on core and differentiated technologies; and 3) promote thedevelopment and commercialization of new products through synergies withGroup companies.
In order to facilitate R&D across the Group as well as further accelerate theR&D of existing products and the commercialization of products in new business fields, JSW implemented a partial reorganization of the Research and Development Headquarters. Details are as follows:(1) The Technological Strategy Office, which was tasked with the planning of
R&D-related themes and the commercialization of new business as well as

Hiroshima Plant
Technical Development Department

the survey of market and technological trends, has been integrated into theNew Business Promotion Headquarters with its functions transferred.
(2) Each research laboratory has been placed under the authority of the individual plants, and the research laboratories in Hiroshima and Yokohama
have been reorganized into the Technological Development Department.

Basic Research and Development Policy
In terms of the promotion and commercialization of new businesses, the New
Business Promotion Headquarters collaborates with each business division andprioritizes R&D on new energy and energy savings, information and telecommunications, nanotechnology and materials, and new production technologies,
all of which are related directly to JSW’s businesses. Through these efforts, we
aim to focus on expanding and upgrading core technologies while cultivatingand growing existing businesses.

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Yokohama Plant
Technical Development Department

R esearch and D e ve lo p m e nt

We engage in basic research for future technologies and contemporarysocial needs and in researching component technologies for existing products. We will build on these efforts to undertake R&D projects that create newproducts and businesses and pursue innovations for existing products.
The focuses in Machinery Products are to enhance plastics machinery, IT
equipment, and other industrial machinery. We will allocate significant
resources to such machinery by clarifying that our commercialization framework is open to mergers, acquisitions, and alliances. In Steel Products, weemphasize advances in energy and creating even more industry-leading
offerings while commercializing new areas.

Activities by Business Segment
Industrial Machinery Products BusinessIn machine-related product development, we are working to develop advanced
processing technology for plastic molding machines; enhance the performanceof plastic extruders; improve the functionality and performance of film molding
equipment; enhance the performance and lower the cost of magnesium injection molding equipment and compressors; and develop manufacturing equipment for fiber-reinforced plastic composite components. We are also
incorporating advanced technologies and systems to develop laser annealing
equipment and other laser application equipment as well as chemical vapor
deposition (CVD) and plasma application equipment. R&D spending in this segment was ¥3,041 million (US$28 million) in fiscal 2017.
Steel and Energy Products Business
Product development centers on materials, notably for clad steel pipes fornatural gas transportation pipelines, large steel castings and high alloys forhigh-efficiency thermal power generation, and forged steel products foradvanced nuclear power plants, as well as manufacturing process technology
development. Our technological development focuses on improving materials and element technologies for existing products. In the area of renewableenergy, we develop material and element technologies to create lighter andmore reliable pressure accumulators for hydrogen fueling stations. Segment
R&D spending totaled ¥1,328 million (US$12 million) in fiscal 2017.

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