DAIHO CORPORATION
1822・Standard Market・Construction
Business
Daiho Corporation is a general contractor founded in 1949, operating across three segments: civil engineering, building construction, and other businesses (real estate, painting, construction materials leasing). Its most distinctive feature is its high level of technical capability in shield tunneling and pneumatic caisson methods specialized for underground structure construction, with a domestic top-tier track record in deep and large-diameter underground works such as rainwater storage facilities, sewerage systems, bridge foundations, and railway tunnel shafts. Its main customers are national and local governments and expressway companies (approximately 50% of completed construction work) and private developers, manufacturers, and others (approximately 50%). The group, including 11 subsidiaries, also undertakes overseas construction projects in Thailand, Madagascar, and elsewhere. It became a consolidated subsidiary of the Aso Group in 2022, and is accelerating its entry into PPP projects and maintenance/repair businesses.
Business Model
A construction contracting model spanning order intake, construction, and handover forms the core of revenue generation. At the end of FY2026 (ending March 2026), the consolidated backlog of construction work in hand stood at ¥207,864 million (civil engineering: ¥129,434 million; building construction: ¥78,430 million), securing roughly 1.5 years' worth of net sales and providing high revenue visibility. Profit depends on the accuracy of construction cost estimates and on-site construction management capability, and a selective, profitability-focused order-taking policy is key to improving profit margins. The group's subsidiary businesses in real estate, painting, and leasing provide complementary and stable earnings.
Company Strengths
Since patenting the Daiho-style pneumatic caisson method in 1952, the company has independently developed the DREAM method (patented 1993), the New DREAM method (patented 2002), and others. The New DREAM method achieves 100% unmanned operation for major high-pressure work and has already been applied to 10 pneumatic caisson construction projects. The medium-term management plan sets a target of over 50% domestic market share, forming a technological entry barrier that is difficult for competitors to replicate in a short period.
As of the end of FY2026 (ending March 2026), the order backlog stood at ¥207,864 million (Civil Engineering ¥129,434 million, Building Construction ¥78,430 million), equivalent to approximately 1.5 times the same period's net sales of ¥139,818 million. This includes large-scale, long-term projects such as the Tokyo Metropolitan Outer Ring Road (scheduled for completion in March 2028) and the Nishinoyama Water Distribution Plant renewal project (scheduled for completion in March 2030), securing a medium-term revenue base.
In 2022, the company implemented a third-party allotment of new shares to Aso Corporation, becoming a consolidated subsidiary of the Aso Group. The aim was to realize synergies such as acquiring know-how for PPP and maintenance/repair businesses, expanding business opportunities outside the Tokyo metropolitan area, and securing construction personnel. Concretizing PPP business through collaboration with the Aso Group is positioned as a key strategy in the medium-term management plan.
ENVALITH's Perspective
Performance Trend
Net sales came to ¥139,818 million (down 2.5% year on year), marking a second consecutive year of declining revenue, but profitability improved significantly, with operating profit of ¥6,895 million (up 24.6% year on year), ordinary profit of ¥7,332 million (up 40.9% year on year), and profit attributable to owners of parent of ¥4,557 million (up 23.5% year on year). The main driver was improved profitability in the construction business (operating profit up 154.1%). Externally, the recording of ¥677 million in foreign exchange gains also boosted ordinary profit. The company achieved a full recovery over two fiscal years from the loss recorded in FY2024 (ending March 2024) (net loss of ¥2,072 million). For FY2027 (ending March 2027), the company forecasts net sales of ¥157,000 million and ordinary profit of ¥8,000 million.
Growth Strategy
Establishing a distinctive general contractor through profit-first priority, concentration on core strengths, and strengthened human capital management
Concentrating management resources on core strengths such as pneumatic caisson and shield tunneling methods to reinforce competitive advantage. Advancing R&D in sewerage renewal technology to open up new markets. Civil engineering orders received in FY2026 (ending March 2026) totaled ¥51,852 million (up 20.0% year on year), showing a recovery trend.
Focusing on securing public sector construction orders while thoroughly applying selective order-taking. In FY2026 (ending March 2026), operating profit in the building construction business grew significantly by 154.1%, confirming the effectiveness of this policy through actual results. The company will continue to concentrate on high-margin projects.
Positioning human resource retention as a top priority, the company is strengthening employee retention and recruitment capability through work-style reform and wage increases. It is accelerating the acquisition of DX and ICT technologies, including implementation of autonomous construction technology in its core construction methods and digitalization/remote operation of construction management, aiming to improve productivity and efficiency.
Targeting companies that can complement and strengthen existing businesses, the company aims to achieve sustainable group growth by acquiring superior technologies. No specific deals have been disclosed at this time, but this is positioned as a key initiative in the medium-term management plan.
Last updated: July 19, 2026