Nippon RAD Inc.
4736・Standard Market・Information & Communication
Business
Nihon RAD Co., Ltd. is an IT solutions provider founded in 1971, listed on the Standard Market of the Tokyo Stock Exchange. The company operates two segments: the Enterprise Solutions Business (contract development, packaged software sales, cloud services, and AI) and the IoT Integration Business (medical, automotive, embedded systems, video, and IoT platforms). Its major customers span a wide range of industries including manufacturing, public sector, and medical institutions, and it is strengthening its competitiveness in the IoT and AI fields through a capital and business alliance with Advantech Co., Ltd., a major Taiwanese industrial computer manufacturer. In July 2025, the company consolidated its subsidiary One's House and began expanding its business into the Tokai and Nagoya regions.
Business Model
In the Enterprise Solutions Business, the company secures stable revenue through Contract System Development & Engineer Staffing, packaged software sales, and Cloud Services. In the IoT Integration Business, in addition to hardware-driven system design, manufacturing, deployment, and maintenance, the company is promoting subscription-based expansion of its proprietary IoT platforms, Dereva and konekti. Under its medium-term management plan (2024–2027), the company has set forth a structural shift toward "earning from assets rather than people," aiming to transition to a high-value-added, high-profitability business model by productizing its accumulated know-how.
Company Strengths
Since its founding in 1971, the company has undertaken large-scale system integration projects such as the Metropolitan Police Department's traffic control and communication dispatch systems, and has built a customer base spanning manufacturing, public sector, healthcare, finance, and other diverse industries. Sales to Daiichi Kankyo Co., Ltd. account for 14.9% of net sales, reflecting long-term, continuous business relationships.
The company combines hardware technology across multiple domains—embedded systems, automotive, marine, video, and medical—with software development capabilities. In 2018, it entered into a capital and business alliance with Advantech, a major Taiwan-listed industrial computer manufacturer, establishing a framework for product procurement and joint proposals in the IoT and AI fields.
As of the end of FY2026 (ending March 2026), the equity ratio stood at 71.27%, with cash and deposits of ¥1,962 million. The company maintains overdraft agreements totaling ¥800 million with four main banks (entirely unused), preserving financial flexibility that can be allocated to strategic investments such as M&A and product development.
ENVALITH's Perspective
Performance Trend
Revenue rose for four consecutive fiscal years, from ¥3,314 million in FY2022 to ¥4,356 million in FY2025, but turned to decline in FY2026, coming in at ¥4,131 million on a consolidated basis. On a non-consolidated basis, revenue was ¥4,032 million (down 7.4% year-on-year), indicating a substantial underlying decline. Operating profit fell approximately 47% from ¥318 million in FY2025 to ¥169 million (consolidated) in FY2026. The main causes were the drop-off in revenue following the completion of a large-scale public-sector system development project for a specific client, and costs associated with the planned reassignment of engineers. As an external factor, prolonged high energy prices stemming from tensions in the Middle East and increasingly cautious IT investment decisions have created headwinds. On the other hand, the structure in which ordinary profit substantially exceeds operating profit was maintained, with ordinary profit reaching ¥244 million on the back of non-operating income such as ¥65 million in dividends received. Financial soundness remains at a high level, with an equity ratio of 71.3% and cash holdings of ¥1,962 million.
Growth Strategy
Transformation of the earnings structure toward a product asset base, together with AI-driven development and business expansion through M&A
As Phase 1 of the medium-term management plan covering FY2024 through FY2027, the company aims to productize know-how from the SI and IoT domains and evolve into a data handler / data assembler enterprise. Enhanced promotion of Dereva and konekti has led to a sharp increase in new project inquiries, along with growing repeat sales to existing customers. However, full-scale contribution to earnings remains a work in progress.
Generative AI and AI-assisted tools are being gradually adopted as supplementary technologies to improve development productivity and create new services. Rather than selling AI itself, the focus is on making it a source of competitiveness for DX initiatives and products that transform customers' operations. In FY2027 (ending March 2027), the plan is to continue strengthening AI-enabled development while advancing personnel training and technical capabilities.
On July 24, 2025, the company acquired all shares of One's House (acquisition cost of ¥231 million), consolidating it from FY2026 (ending March 2026). Due to One's House's fiscal year-end (January 31), only six months of its earnings were consolidated in the current period. While continuing to build out group management systems, the company also plans to continue investing in enhancing new product and platform functionality and developing edge products to support medium-term growth.
Last updated: July 19, 2026