ENVALITH
株式会社シイエヌエス logo

CNS Co.,Ltd.

4076・Growth Market・Information & Communication

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株式会社シイエヌエス logo
CNS Co.,Ltd.4076

Business

CNS Co., Ltd. is an independent IT services company founded in 1985. It consists of the company and one consolidated subsidiary (CNS Hokkaido Co., Ltd.), and operates under the single segment of "System Engineering Service Business (Single Segment)." The company operates in five business areas: digital innovation promotion (ServiceNow and generative AI), big data analysis (SAS collaboration), system infrastructure (OCI and AWS), business system integration (finance and distribution), and consulting. Starting from FY2026 (ending May 2026), the company is transitioning to a divisional structure, reorganizing into three divisions: Technology Solutions Business, Business Solutions Business, and Consulting Business. Major clients include NTT DATA (21.1% of sales), NTT DATA Group (11.4% of sales), Nomura Research Institute (9.9% of sales), and other major system integrators, telecommunications companies, and financial institutions. The company listed on the Tokyo Stock Exchange Mothers market (now the Growth Market) in August 2021.

Business Model

Primary revenue comes from contracted system development and operation/maintenance services for major SIers, telecommunications carriers, and financial institutions. The company provides an integrated development process from requirements definition through comprehensive testing, forming long-term continuous relationships spanning upstream consulting to operation and maintenance. Through its proprietary original brand "U-Way" (launched in October 2022), it offers package-type services utilizing OCI, ERP, SAS Viya, and other technologies, aiming to reduce dependence on contracted work and diversify revenue. Cost of sales is mainly composed of personnel costs and outsourcing processing costs, reflecting a labor-intensive business model.

Company Strengths

The company generates ¥1,475,823 thousand in sales from NTT DATA (21.1% of net sales), ¥800,785 thousand from NTT DATA Group (11.4%), and ¥697,304 thousand from Nomura Research Institute (9.9%), with these three major SIers accounting for approximately 42% of net sales, providing a stable business foundation. Since being certified as an NTT DATA Business Partner in 2011, the company has built a long-term relationship of trust.

Orders have grown through collaboration with AoraNow in ServiceNow implementation support. The company has obtained Enhanced Oracle PartnerNetwork Level 2 and Oracle NetSuite Alliance Partner status with Oracle, establishing a foothold for full-scale entry into the ERP domain. Under its partnership with SAS Institute Japan, the company offers its proprietary service, the "U-Way Migration to SAS Viya" implementation support service.

Net sales grew for five consecutive fiscal years, from ¥4,841 million in FY2021 (ending March 2021) to ¥7,005 million in FY2025 (ending March 2025). As of the end of FY2025, total net assets stood at ¥3,959,471 thousand and cash and cash equivalents at ¥2,966,277 thousand, indicating ample liquidity on hand, and the company maintains a debt-free management policy based on the principle of direct financing. Against total assets of ¥5,259,857 thousand, the equity ratio remains at a high level.

ENVALITH's Perspective

Profit attributable to owners of parent of ¥590 million (up 38.3% year on year) for FY2026 (ending March 2026) [note: original text states 2026年5月期] includes a one-time profit-boosting effect (adjustment to income taxes of -¥59,963 thousand) associated with a review of tax effect accounting. It should be noted that net income on an underlying basis, excluding this effect, would fall below the disclosed figure. On the other hand, operating profit of ¥685 million (up 23.4%) and ordinary profit of ¥725 million (up 24.0%) do not include one-time factors and indicate genuine improvement in underlying business performance.

For the fiscal year ending May 2026, combined sales to NTT DATA and the NTT DATA group amounted to ¥2,517 million, accounting for approximately 32% of total revenue. Should major SIers change their IT investment policies or order volumes fluctuate as an external factor, the impact on performance would be significant. The newly disclosed status of Nomura Research Institute (¥811 million) as a major customer indicates progress in customer diversification, but concentration among top customers remains high, and expanding direct transactions with end users (prime contracts) will be key to resolving this structural challenge.

The consolidated earnings forecast for the fiscal year ending May 2027 is revenue of ¥9,278 million (up 19.3% year on year) and operating profit of ¥966 million (up 40.9%). This forecast falls approximately 7% short of the ¥10.0 billion (¥10,000 million) revenue target set as the final goal of the medium-term management plan. The company has explicitly stated that it will "aim to achieve this centered on organic business growth, while also considering the use of growth investment," suggesting the possibility of M&A. As an external environment factor, demand for DX- and AI-related IT is expected to remain solid, but there is a risk that tight supply and demand for IT and digital talent will continue to exert upward pressure on personnel expenses.

Growth Strategy

Aiming for ¥10 billion in revenue and an operating margin of 10% or higher in FY2027 (ending May 2027) through ERP expansion, generative AI utilization, and strengthening of prime contracts

Promoting new development projects in next-generation payment platforms, centered on the expansion of generative AI projects for major SIers. Strengthened technical collaboration and service delivery capabilities through a strategic partnership with NTQ Solution (Vietnam). Achieved sales of ¥3,580 million (up 27.2% year on year) in FY2026 (ending May 2026), driving increased revenue and profit across the group as a whole.

Promoting project generation and business expansion through the strengthening of the partnership with Oracle. In FY2026 (ending May 2026), talent development costs associated with the launch of the ERP business were incurred upfront, resulting in an 11.1% year-on-year decline in gross profit for the Business Solutions Business. An organizational change to strengthen the ERP business has already been implemented ahead of FY2027 (ending May 2027).

Focused on expanding direct transactions with end users, winning prime contracts for core system renewals in manufacturing, as well as for major healthcare and construction clients. Gross profit for FY2026 (ending May 2026) improved significantly, up 26.5% year on year, driven by an increased proportion of high-margin projects including upstream processes. Continuing to promote the expansion of prime contracts through company-wide value chain strengthening.

Aiming to improve productivity and profitability by utilizing generative AI company-wide in combination with a review of project composition. The FY2027 (ending May 2027) operating profit forecast of ¥966 million (up 40.9% year on year) implies a profit growth rate substantially exceeding the 19.3% sales growth rate, premised on the realization of productivity improvement effects.

For the final target of the medium-term management plan—¥10 billion in revenue—the company has stated it will pursue this centered on organic growth while also considering the use of growth investments (M&A). The FY2027 (ending May 2027) forecast of ¥9,278 million falls approximately 7% short of the target, suggesting that the execution of M&A could be key to achieving the goal.

Last updated: July 17, 2026