Nihon Dengi Co., Ltd.
1723・Standard Market・Construction
Business
Nippon Denki Co., Ltd. is a comprehensive instrumentation and controls engineering company founded in 1959. Its core business is the air conditioning control equipment-related business, providing integrated design, installation, and maintenance of automatic air conditioning control systems for non-residential buildings such as office buildings, factories, hospitals, laboratories, and commercial facilities. As its second pillar, the company operates an industrial systems-related business, handling instrumentation work for factories and conveyance lines, as well as FA systems and production management systems for food factories. As a group including its consolidated subsidiary Jupiter Advanced Systems, the company also sells automatic control equipment based on its distributor agreement with Azbil. The company is listed on the Standard Market of the Tokyo Stock Exchange.
Business Model
The majority of orders are obtained through negotiated (sole-source) contracts, with the company winning projects without competitive bidding on the strength of its long-standing customer base and technical capabilities. A characteristic recurring-revenue structure exists whereby, after acquiring a customer through new construction work, the company continues to generate ongoing revenue from existing facility work (maintenance, renewal, and energy-saving retrofits). In FY2026 (ending March 2026), the gross profit margin reached 47.4%, and the segment profit margin for the air conditioning control systems-related business reached 39.7%, achieving extremely high profitability as a high-value-added engineering service.
Company Strengths
The majority of orders are secured through sole-source (tokumei) contracts, and in FY2026 (ending March 2026), the segment profit margin for the HVAC instrumentation-related business reached 39.7% (up from 34.4% in the prior period), with company-wide gross profit margin reaching 47.4% (up from 43.3% in the prior period). The customer trust and technical track record accumulated over more than 65 years since the company's founding in 1959 form an entry barrier that competitors find difficult to replicate in a short period.
The company has established a cyclical revenue model in which, following completion of new construction work, it continuously secures orders for existing facility work (maintenance, renewal, and energy-saving retrofits). In FY2026 (ending March 2026), orders received for existing facilities were robust at ¥31,031 million (up 24.7% year on year), and the order backlog carried forward to the next period reached a company-wide total of ¥33,350 million (up 29.4% year on year), providing high visibility as a leading indicator of future revenue.
The company possesses the technical capabilities of a "comprehensive instrumentation engineering company," able to independently cover both the HVAC instrumentation and industrial systems (FA systems and production management) domains. Its consolidated subsidiary Jupiter Advance Systems also develops and sells "Misuzu8," an integrated production management system for food factories, giving the group the capability to address the smart factory field.
ENVALITH's Perspective
Performance Trend
Revenue increased 46% over five fiscal periods, from ¥31,669 million in FY2022 (ended March 2022) to ¥46,371 million in FY2026 (ending March 2026). Operating profit expanded roughly 2.9-fold over the same period, from ¥4,074 million to ¥11,821 million, with the operating margin improving significantly from 12.9% to 25.5%. In FY2026 (ending March 2026), the main drivers were expansion of existing-facility work in the air conditioning control equipment-related business (revenue of ¥27,516 million, up 20.9% year on year) and improved profitability through selective order intake. External tailwinds include redevelopment in the greater Tokyo area, the reshoring of domestic manufacturing bases, and demand for energy-saving investment. The company's forecast for FY2027 (ending March 2027) calls for continued revenue and profit growth, with revenue of ¥51,500 million and operating profit of ¥12,500 million.
Growth Strategy
Achieving sustainable growth through a three-pronged approach: deepening existing equipment work, expanding the industrial systems business, and promoting DX
Securing stable existing-equipment revenue through collaboration with new construction work, and promoting an environmental solutions business in line with sustainability trends. Orders received for existing equipment in FY2026 (ending March 2026) reached ¥31,031 million (up 24.7% year on year), expanding steadily. Backlog carried over to the next fiscal year of ¥29,421 million (up 28.5% year on year) will support next-period sales.
Strengthening sales capabilities toward plant engineering companies to promote orders for central monitoring systems and expand the stock business. Establishing a smart factory domain through data linkage between production management and control systems for food factories, in collaboration with Jupiter Advance Systems. Segment profit in FY2026 (ending March 2026) rose substantially to ¥867 million (up 102.5% year on year).
Promoting productivity improvement and the creation of new customer value through AI-based utilization of various data as a key initiative. Aiming to expand construction capacity under labor shortage conditions by improving the efficiency of construction and maintenance operations. Specific numerical targets have not been disclosed, but full-scale efforts are set to begin from FY2026 (ending March 2026).
Implemented a two-stage stock split—a 1:2 split in January 2025 and a 1:4 split in April 2026—to lower the investment unit amount. Aims to improve liquidity and expand the investor base. Forecast dividend per share for FY2027 (ending March 2027) is ¥56 (post-split), an increase of ¥16 year on year (payout ratio of 41.0%).
Last updated: July 19, 2026