JINUSHI Co., Ltd.

Business Details

The company invests only in land and concludes long-term fixed-term land lease agreements with tenants. Since tenants bear the cost of building investment, no additional investment is required, and the company develops jinushi land (real estate financial products) that are resilient to natural disasters and market volatility, then sells it to the Jinushi REIT and other business corporations, private funds, J-REITs, etc. In Q1 FY2026 (ending December 2026), net sales were ¥13,619 million, accounting for 93.5% of consolidated total, making it the core business, comprising flow revenue (real estate sale revenue) of ¥12,952 million and stock revenue (revenue from properties held for lease) of ¥667 million.

Recent Overview

Q1 net sales fell 54.3% year-on-year, but purchases expanded significantly, up ¥14.9 billion year-on-year

In Q1 FY2026 (ending December 2026), Real Estate Investment Business net sales were ¥13,619 million (down 54.3% year-on-year) and segment profit was ¥2,276 million (down 34.5% year-on-year). This reflects the plan for FY2026 (ending March 2026) to record profit mainly in Q4, and the company has explained that progress is as expected. On the other hand, purchases (on a contract basis) expanded significantly to ¥27,800 million, up ¥14,900 million year-on-year, supported by the three growth strategies of diversifying tenant industries, expanding business areas, and JINUSHI Leaseback proposals, as well as by tailwinds from corporate demand for real estate sales driven by Tokyo Stock Exchange reforms. The real estate for sale balance increased by ¥32,731 million from the end of the prior fiscal year to ¥112,020 million, indicating continued accumulation of future sale revenue.

Key Products

Growth Drivers

• Expansion of sales to the Jinushi Private REIT Investment Corporation (following the 10th capital increase in January 2026, asset scale reached ¥291.1 billion, making achievement of the medium-term target of ¥300 billion within FY2026 (ending December 2026) highly likely)
• Significant expansion in purchases (contract basis) (¥27,800 million in Q1 FY2026, ending December 2026, up ¥14,900 million year-on-year)
• Increasing corporate demand for real estate sales driven by Tokyo Stock Exchange reforms and CRE strategy reviews
• Progress on the three growth strategies of JINUSHI Leaseback, diversification of tenant industries, and expansion of business areas
• Continued expansion of the jinushi land market (¥7.24 trillion as of 2024, projected to reach ¥10.4 trillion by 2027)
• Increase in stock revenue due to accumulation of real estate for sale balance (¥667 million, up 76.5% year-on-year)

Risks

• Customer concentration risk due to concentration of sales to the Jinushi Private REIT Investment Corporation
• Risk of difficulty selling real estate for sale during a downturn in real estate market conditions (although there is the option of securing lease revenue through self-holding)
• Risk of increased funding costs due to rising interest rates amid monetary policy normalization (long-term borrowings of ¥108,802 million, non-recourse long-term borrowings of ¥30,400 million)
• Risk of period-to-period earnings volatility due to reliance on flow revenue (sale revenue) (FY2026, ending December 2026, plan is weighted toward Q4)
• Risk of increased interest-bearing debt due to accelerated purchasing (total assets of ¥203,797 million, equity ratio declining to 24.3%)