ENVALITH
株式会社力の源ホールディングス logo

CHIKARANOMOTO HOLDINGS Co.,Ltd.

3561・Prime Market・Retail Trade

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株式会社力の源ホールディングス logo
CHIKARANOMOTO HOLDINGS Co.,Ltd.3561

Business

Chikaranomoto Holdings Co., Ltd. is a global restaurant holding company centered on "IPPUDO," a Hakata-style ramen chain founded in 1985, operating a total of 317 stores comprising 173 domestic locations and 144 overseas locations across 16 countries. Domestically, the company operates multiple brands including "IPPUDO," "RAMEN EXPRESS," "Inaba Udon," and "Najimatei" through both directly managed stores and franchise (license) arrangements, while overseas it expands the "IPPUDO" brand through directly managed stores and license partners. The company also operates a Product Sales Business handling manufacturing, sales, and e-commerce of noodles, soups, and related products, aiming for a vertically integrated business model that spans production, distribution, and sales of ingredients. Its primary customers are general consumers both in Japan and overseas, with inbound demand also serving as an important source of customer traffic.

Business Model

Revenue is composed of three layers: ① dining sales at directly managed stores (domestic and overseas), ② royalty income from noren-wake (franchise-style branch) and license contract partners (23 domestic stores and multiple overseas countries), and ③ product sales revenue from wholesale manufacturing and EC sales of noodles, soup, and other products. While directly managed stores account for the majority of sales, the licensing business functions as an asset-light revenue source that keeps fixed costs low. The Product Sales Business has the highest profit margin at 12.7%, complementing the profitability of the group as a whole.

Company Strengths

Founded in 1985, "IPPUDO" has a 41-year history and operates 143 domestic stores and 131 overseas stores (IPPUDO). It has achieved directly managed and licensed operations across 16 countries and regions worldwide, and has concluded long-term contracts (5-10 years) with license partners in major Asian markets such as China/Hong Kong, Malaysia, Thailand, and the Philippines. This accumulated brand recognition and international expansion know-how constitute a unique asset that competitors cannot easily replicate in a short period.

The in-house independence support system (noren-wake) began in 2010, and as of the end of March 2026, 23 domestic stores are operated under a license format. This scheme, in which former employees become store owners, enables the acceleration of brand expansion while curbing the group's direct investment. Royalty income is linked to sales, and the structure of accumulating revenue without fixed cost burden contributes to the earnings stability of the domestic business.

The segment profit margin of the Product Sales Business stands at 12.7% (FY2026 (ending March 2026)), the highest level among the three business segments. In addition to strengthening domestic B2B sales, the company has expanded its overseas sales channels by starting new transactions with mass retailers in the United States, Taiwan, and South Korea. The diversification of sales channels—including promoting repeat purchases through a subscription system introduced on its own e-commerce site, and developing collaborative products with convenience stores and food manufacturers—supports the maintenance and improvement of profit margins.

ENVALITH's Perspective

In FY2026 (ending March 2026), revenue reached ¥36,261 million (up 6.1% year on year), marking six consecutive years of revenue growth, while operating profit declined for the second consecutive year to ¥2,325 million (down 17.3% year on year), with the operating margin falling to 6.4%. This represents a 4.0 percentage point deterioration from the peak of 10.4% recorded in FY2024 (ended March 2024), as rising raw material costs, labor costs, and logistics costs are squeezing profits. The forecast for FY2027 (ending March 2027) anticipates a modest recovery in operating margin to 6.5%, but this does not amount to a fundamental improvement in profitability.

Segment profit for Overseas Store Operations deteriorated significantly to ¥870 million (down 22.6% year on year), with the margin remaining at just 6.0%. In addition to rising costs of raw materials, labor, and rent due to global inflation, this was compounded by declines in customer visits stemming from abnormal weather and worsening security conditions, as well as increased costs from delays in new store openings. External factors such as yen depreciation and geopolitical risk also continue, and whether cost reduction effects from shift adjustments and raw material reviews will fully materialize will be a key focus for FY2027 (ending March 2027).

Domestic Store Operations posted solid revenue of ¥17,417 million (up 12.0% year on year), supported by the acquisition of the Kaede and Kanade brands through M&A and net store openings (a net increase of 17 stores). The dividend is planned at ¥20 per share for FY2026 (ending March 2026), up ¥2 from the previous fiscal year, and ¥24 per share (including a special ¥2 dividend commemorating the company's 40th anniversary) is forecast for FY2027 (ending March 2027), with a payout ratio of 40.3%, marking five consecutive years of dividend increases and demonstrating a clear commitment to shareholder returns. ROE declined to 16.1% from 17.6% in the previous fiscal year, and improvement through profit growth is needed.

Growth Strategy

Multifaceted growth through accelerated domestic store openings, overseas cost improvement, expansion of product sales, and M&A

In addition to conventional densely populated areas and commercial facilities, the company is actively promoting store openings in medium-sized trade areas and roadside locations near urban centers. In FY2026 (ending March 2026), the company opened 12 IPPUDO stores and 1 Inaba Udon store, expanding to 173 domestic stores. From April 2026, a field-strength promotion block will be established at 9 stores, combining DX initiatives such as automatic fried rice cookers to improve profitability.

The company opened its first store in Spain in September 2025 and plans to open a store in Germany in FY2027 (ending March 2027). It is also promoting new store openings through licensing in the Midwest region of the United States. In existing markets, the company continues cost reduction measures such as shift adjustments and raw material reviews, aiming to make the effects visible. In FY2026 (ending March 2026), overseas stores totaled 144 (up 4 stores from the end of the previous fiscal year).

In October 2025, the halal format "Ramen Mania" was newly opened in Indonesia. As a new brand strategy to capture the huge market of the Islamic world, the company is considering expanding to more countries starting from Indonesia. This initiative simultaneously addresses dietary diversity and new market development.

In FY2026 (ending March 2026), the company began new transactions with major mass retailers in the United States, Taiwan, and South Korea, expanding overseas sales channels. The company continues to expand into markets where demand for Plant-Based Shiromaru/Akamaru (Dried Noodle Type) is expected. Domestically, the company is promoting stronger B2B sales of IPPUDO-related products and expanding its own e-commerce site.

In FY2026 (ending March 2026), the company acquired 6 Kaede brand stores and 2 Kanade brand stores through M&A, expanding the scale and diversification of its domestic business. The company is also considering expanding the store-opening areas of Inaba Udon and Najimatei, with a policy of continuing to develop new trade areas through brands other than IPPUDO.

Last updated: July 19, 2026