EPCO Co.,Ltd.

Business Details

This segment primarily undertakes installation work for solar power generation systems, storage batteries, all-electric equipment, EV chargers, and similar equipment for new and existing homes as well as commercial facilities. Domestically, TEPCO Home Tech, a joint venture with Tokyo Electric Power Company Energy Partner (accounted for by the equity method), and Enes Co., Ltd. (ENE's), a wholly owned subsidiary, serve as the core of the business. Overseas, following a change in the scope of equity-method affiliates (partial sale of the equity stake in Banhao Aibokoshinenerugi Sekkei (Shenzhen) Co., Ltd.), the structure of the renewable energy business targeting the Chinese market has changed. The segment aims to help realize a decarbonized society and provide housing resilient to natural disasters.

Recent Overview

Continued strength at ENE's and rapid expansion at TEPCO Home Tech drove segment ordinary income up 620.1% year on year

In Q1 of FY2026 (ending December 2026), ENE's contracted installation work for solar power generation and storage batteries, as well as panel inspection work, continued to perform well, resulting in external customer sales of ¥552 million (up 12.2% year on year). TEPCO Home Tech's equity-method investment gain/loss expanded rapidly to ¥40 million (up 193.2% year on year). In addition, the overseas investment loss shrank significantly due to the effect of the change in scope of equity-method affiliates following the partial sale of the equity stake in the overseas affiliate, resulting in a dramatic improvement in segment ordinary income to ¥80 million (up 620.1% year on year).

Key Products

Growth Drivers

• Increase in contracted installation work for solar power generation and storage batteries, and panel inspection work, at Enes Co., Ltd. (ENE's)
• Steady performance in TEPCO Home Tech's residential installation contracting business (equity-method investment gain/loss of ¥40 million, up 193.2% year on year)
• Expansion of demand for renewable energy equipment driven by enhanced government and local authority subsidy and grant programs to realize a decarbonized society
• Policy tailwinds from the target of a 40-50% renewable energy ratio by FY2040 under the "7th Strategic Energy Plan"
• Promotion of adoption through zero-initial-cost subscription models "Enekari" and "Enekari Plus"
• Increasing demand for maintenance and inspection as renewable energy equipment becomes more widespread

Risks

• Risk of shrinking demand for residential installation work due to a decline in new housing starts (which also recorded a year-on-year decrease in Q1 of FY2026)
• Uncertainty regarding the overseas revenue contribution following the change in scope of the overseas equity-method affiliate (Shenzhen Liansu Aibokoh Engineering Design Co., Ltd.)
• Risk of rising costs associated with expanding the installation network (locations, personnel, M&A)
• Risk of rising local costs in China due to yen depreciation
• Risk of changes in the relationship with the joint venture partner (Tokyo Electric Power Company Energy Partner)
• Risk of obsolescence of existing equipment due to the commercialization of next-generation technologies (such as perovskite solar cells)
• Risk of sluggish housing demand due to rising construction costs from higher raw material prices and labor costs, and rising mortgage interest rates