SecuAvail Inc.

Business Details

Since its founding in 2001, the company has operated as a dedicated information security business, offering "NetStare®," an integrated security operations service combining SOC and NOC functions, and "LogStare®," a cloud-based security operations platform. The segment is composed of two companies, Securevail Inc. and LogStare Inc., serving a wide range of industries including public institutions, medical institutions, and manufacturing (OT/IoT). It is built on a stock-based (recurring revenue) contract model, providing a stable revenue structure. In FY2026 (ending March 2026), the segment achieved increased revenue and profit through the expanded sale of the AI-SOC Series and the renewal of stock-based contracts with existing customers.

Recent Overview

Segment profit margin improved significantly from 15.8% to 25.0%, driven by the effect of amortized LogStare software and expanded sales of AI-SOC.

In the Information Security Business for FY2026 (ending March 2026), revenue reached ¥1,031 million (up 9.7% year on year) and segment profit reached ¥258 million (up 74.1% year on year), representing a significant increase in profit. The main driver of the improved profit margin was increased sales of the "LogStare" product, which is already-amortized software in terms of development expenses. The company promoted the launch of the AI-SOC Series and expanded support for major cloud services and network devices. Despite investments such as increased headcount, the profit margin improved to 25.0%. Revenue from the major customer, NRI SecureTechnologies, increased significantly to ¥264 million (20.6% of consolidated revenue) from ¥190 million in the prior period, and it should be noted that customer concentration risk is increasing.

Key Products

Growth Drivers

• Expanding demand for information security driven by the increasing sophistication and complexity of cyberattacks amid DX progress and expanding cloud usage
• Expanding demand for log monitoring and analysis systems among critical infrastructure operators and their supply chain companies, driven by progress in institutional frameworks for active cyber defense
• Enhanced competitiveness and new customer acquisition through the expansion of the AI-SOC Series leveraging AI technology
• Maintaining and strengthening the high-profit-margin structure through increased sales of the already-amortized "LogStare" software product
• Expanding the customer base through the rollout of services targeted at small and medium-sized enterprises
• Diversifying the customer base through industry-specialized service offerings such as those for medical and OT/IoT sectors
• Stable contract renewals and revenue accumulation through the stock-based (recurring revenue) business model
• Upselling and new customer acquisition through partner development and revitalization of existing partners

Risks

• Increasing customer concentration risk due to revenue dependence on NRI SecureTechnologies Ltd. (20.6% of consolidated revenue in FY2026 (ending March 2026), a significant increase year on year)
• Increased recruitment and training costs due to a shortage of information security engineers and rising labor costs
• Risk of profit margin pressure from business investments such as expanded sales of the AI-SOC Series, planning and development of new services, and development of the security operations platform
• The need for continuous investment in service development to address the increasing sophistication and complexity of cyberattacks
• Erosion of the stock-based (recurring revenue) base due to the risk of existing customer cancellations
• Risk related to meeting the Growth Market listing maintenance criteria (market capitalization)