Daiei Inc., which hasn't posted a profit since 2008, is targeting its first dividend payment in 16 years after it completes a doubling in capital spending to add more stores.

The retailer aims to pay a dividend as early as 2014, President Michio Kuwahara said in an interview Monday at the company's Tokyo headquarters. Daiei, which has narrowed annual losses by 78 percent since fiscal 2009, is now in a position to invest in growth, he said.

Daiei, once the largest grocer, will invest ¥28 billion in the financial year starting in March to open 28 new stores, including at least four under its namesake brand.

The fastest expansion since a government bailout in 2004 follows a decade spent cutting debt by about ¥2.4 trillion through asset sales, including convenience store chain Lawson Inc. and the Fukuoka Hawks baseball team.

"Daiei's day in the sun will definitely arrive," said Mikihiko Yamato, an analyst at JI Asia in Tokyo, who recommends buying the stock. "They have one of the healthiest balance sheets of any Japanese supermarket chain."

Daiei had debt of about ¥69 billion at the end of the August half, spokeswoman Shoko Amesara said Monday. The company's borrowings come to about 46 percent of total equity, compared with 131 percent for Aeon Co., Japan's biggest general retailer, and the 51 percent average for the country's 14 large retailers.

The chain received a bailout from the state-led Industrial Revitalization Corp. of Japan totaling ¥707 billion after an expansion spree in the 1970s and 1980s saw it buy assets including a mall in Hawaii and the Hawks baseball team. When the recession started in the 1990s, Daiei couldn't repay its debts.