CHIKARANOMOTO HOLDINGS Co.,Ltd.

Business Details

Centered on the Hakata ramen specialty brand "IPPUDO," the company operates multiple brands in Japan, including the food court format "RAMEN EXPRESS," the long-established udon shop "Inaba Udon," and "Najimatei." In addition to directly managed stores, the company also expands through licensing under a noren-wake (franchise) system, catering to diverse locations such as urban roadside shops, commercial facilities, and roadside locations. The target customer base is broad, spanning all ages and genders from singles to families, with the trinity of "taste, atmosphere, and service" serving as the source of competitive advantage. As of the end of FY2026 (ending March 2026), the company operated 173 stores (including 27 licensed stores).

Recent Overview

Net sales rose 12.0% year on year to ¥17,417 million, but segment profit fell 6.5% due to increased costs

In FY2026 (ending March 2026), new store openings (12 IPPUDO stores and 1 Inaba Udon store opened, 4 IPPUDO stores closed) and M&A (addition of 6 Kaede stores and 2 Kanade stores) expanded the store count at period-end to 173 stores (up 17 stores year on year), and net sales reached ¥17,417 million (up 12.0% year on year). On the other hand, rising costs for raw materials, logistics, and labor, combined with a decline in existing-store customer traffic due to intense summer heat and prolonged warm weather, and a decrease in inbound demand from China, led to a deterioration in segment profit to ¥1,447 million (down 6.5% year on year). The company has not implemented a price increase in the approximately two and a half years since its October 2023 price hike. Starting in April 2026, the company established a frontline capability promotion block covering 9 stores to improve QSC (Quality, Service, Cleanliness) and profitability.

Key Products

Growth Drivers

• Continued promotion of new store openings (12 IPPUDO stores and 1 Inaba Udon store opened in FY2026 (ending March 2026), with expanded openings in mid-sized trade areas and roadside locations near urban centers)
• Steady inbound demand (mainly from East Asia, Europe, the US, and Australia) and a recovery in personal consumption driven by improving income conditions
• Customer traffic effects from sales of limited-edition products commemorating the 40th anniversary of founding, seasonal products, and increased media exposure
• Business expansion through M&A (acquisition of the Kaede and Kanade brands) and licensing expansion through the noren-wake system (23 stores as of the end of March 2026)
• Profitability improvements through DX measures such as the establishment of a frontline capability promotion block (9 stores from April 2026) and the introduction of automated fried rice cooking equipment
• Development of new trade areas through expanded store opening areas for Inaba Udon and Najimatei

Risks

• Pressure on operating profit margin from continued increases in raw material prices, logistics costs, and labor costs
• Risk of being unable to pass on cost increases through price hikes, having not raised prices for approximately two and a half years since the October 2023 price increase
• Risk of decreased customer traffic at existing stores due to weather factors such as intense summer heat and prolonged warm weather
• Impact on sales from the emerging decline in inbound demand from China
• Intensifying competition for talent acquisition and increased recruitment costs (rising labor costs due to base pay increases)
• Risk of impairment of fixed assets (an impairment loss of ¥214 million was recorded on a consolidated basis in FY2026 (ending March 2026))