Shin Nippon Air Technologies Co., Ltd.

Business Details

The company designs, supervises, and undertakes construction of air conditioning, heating and ventilation, water supply and drainage, sanitary, and electrical facility equipment. Domestically, Shin Nikku Service (construction cooperation and maintenance) and Nippo Kogyo (electrical and industrial facility construction) provide complementary support. Overseas, the company operates in China, Hong Kong, Singapore, Sri Lanka, and Vietnam, primarily undertaking air conditioning equipment construction for Japanese companies expanding abroad. Data centers, semiconductors, large-scale redevelopment projects, and nuclear facilities are the main sources of demand. In FY2026 (ending March 2026), the company achieved record-high profits across all profit metrics.

Recent Overview

In FY2026 (ending March 2026), the company achieved record-high revenue and profit across all metrics, with substantial increases in orders received and backlog.

In FY2026 (ending March 2026), completed construction revenue was ¥154,884 million (up 12.5% year on year), operating profit was ¥15,128 million (up 33.3% year on year), ordinary profit was ¥15,881 million (up 32.6% year on year), and net profit was ¥12,154 million (up 25.9% year on year), setting record highs across all profit metrics. Orders received rose to ¥177,762 million (up 15.5% year on year), and the period-end backlog increased to ¥148,747 million (up 18.2% year on year), further improving visibility of future revenue. Orders received for nuclear facility equipment construction surged 80.0% year on year to ¥11,851 million. Improved profitability at the order stage, enhanced project management, and more efficient construction systems contributed to the improvement in profit margins. For FY2027 (ending March 2027), the company forecasts completed construction revenue of ¥160,000 million (up 3.3% year on year) and operating profit of ¥16,000 million (up 5.8% year on year).

Key Products

Growth Drivers

• Continued expansion of capital investment demand related to data centers and semiconductors
• Steady progress in large-scale redevelopment and real estate investment centered on major metropolitan areas
• Mid-to-long-term revenue contribution from a surge in orders for nuclear facility equipment construction (up 80.0% year on year to ¥11,851 million)
• Improved profitability at the order stage and enhanced project management, driving up the gross margin on completed construction (from 15.98% in the prior period to 17.55% in the current period)
• High visibility of future revenue supported by a period-end backlog of ¥148,747 million (up 18.2% year on year)
• Increased inquiries related to energy conservation and renewable energy, and expanding demand associated with carbon neutrality initiatives
• Business evolution under the medium-term management plan Phase III (FY2026–FY2029), centered on the twin pillars of "digital and green"

Risks

• Cost pressure risk from continued increases in materials, labor, and logistics costs
• Risk of construction capacity constraints and delivery delays due to shortages of skilled engineers and technical workers
• Revenue concentration risk with Shimizu Corporation (15.7% of completed construction revenue in FY2025, ended March 2025)
• Decline in overseas orders received (from ¥20,867 million in the prior period to ¥13,651 million in the current period, down 34.6%) and shrinkage of the overseas backlog
• Foreign exchange fluctuation risk and geopolitical risk (China, Southeast Asia) in overseas operations
• Risk of increased costs associated with carbon neutrality initiatives and DX investment
• Impact on operating cash flow from increased corporate tax payments (from ¥3,175 million in the prior period to ¥5,877 million in the current period)