DMW CORPORATION
6365・Standard Market・Machinery
Business
Dengyosha Machine Works, Ltd. is a specialized manufacturer with a history of over 100 years since its founding in 1910, focusing on fluid machinery such as pumps, blowers, valves, and energy recovery systems. Its products are supplied for a wide range of applications, including agricultural water, water supply and sewerage, power plants, seawater desalination, petrochemicals, and road tunnel ventilation. The customer base is divided between the public sector, such as government agencies and local municipalities (approximately 67% of net sales), and the domestic private and overseas sectors, with the company adopting a full build-to-order production system. The company has three consolidated subsidiaries: Dengyosha Kouji (installation work), Eco Advance (environment-related equipment), and DMW India (overseas base), providing integrated services from manufacturing to installation and maintenance.
Business Model
The company adopts a build-to-order production model tailored to each customer's specifications, offering high value-added products differentiated from standard offerings. Revenue is recognized based on the percentage-of-completion method (input method), and the order backlog of ¥27,293 million at fiscal year-end underpins sales for the following and subsequent periods. In addition, the company aims to secure ongoing revenue after delivery through the expansion of the P&M (Parts Supply & Maintenance) Service business. Fund procurement is based primarily on retained earnings, and the company maintains a sound financial structure close to a debt-free management approach.
Company Strengths
As of the end of FY2026 (ending March 2026), the order backlog reached ¥27,293 million (equivalent to approximately 97% of net sales), and the build-to-order business model enables highly certain visibility into revenue for subsequent periods. Centered on the ¥17,700 million order backlog in the government demand sector, the backlog is well diversified with ¥5,840 million in domestic private demand and ¥3,752 million overseas, limiting the risk of dependence on a single customer.
In FY2026 (ending March 2026), the gross profit margin improved to 27.3% (26.1% in the previous fiscal year) and the operating margin improved to 12.4% (11.5% in the previous fiscal year), marking two consecutive years of improvement. Efforts to reduce manufacturing costs bore fruit, and even as net sales remained nearly flat (up 0.4% year on year), operating profit increased 8.0% year on year to ¥3,495 million.
Building on fluid machinery technology accumulated over more than 100 years of history, the company possesses proprietary products such as the geared vertical shaft pump "Lambda 21," the multi-stage turbo blower "AM-Turbo®" featuring an aluminum alloy impeller, and the Energy Recovery System "DeROs-E®." The company continues to invest ¥268 million in research and development, advancing efforts toward higher efficiency, miniaturization, and the development of condition monitoring systems.
ENVALITH's Perspective
Performance Trend
Revenue continued its expansionary trend, rising from ¥22,820 million in FY2022 (ended March 2022) to ¥28,077 million in FY2025 (ended March 2025), but growth decelerated in FY2026 (ending March 2026), with revenue reaching only ¥28,189 million, up just +0.4% year on year. Meanwhile, operating profit reached ¥3,495 million (+8.0% year on year) and net income attributable to owners of parent reached ¥2,615 million (+7.8% year on year), both marking the highest levels in the past five fiscal years. Reductions in manufacturing costs proved effective, improving the gross profit margin to 27.3% and the operating margin to 12.4%. While revenue growth in the domestic private-sector demand segment and the overseas segment underpinned overall performance, revenue in the public-sector demand segment declined by -4.3% year on year. For FY2027 (ending March 2027), the company forecasts lower revenue and profit, reflecting a decline in the order backlog, and uncertainty regarding the outlook is heightening due to external factors such as U.S. tariff policy and geopolitical risks.
Growth Strategy
Under DMW Medium-Term Management Plan 2028, the company is pursuing expansion in the domestic private-sector and overseas businesses along with shareholder returns targeting a dividend payout ratio of 30% or higher
The company is promoting increased sales of the Energy Recovery System "DeROs-E" and other products, driven by decarbonization and energy-saving demand. Domestic private-sector orders received in FY2026 (ending March 2026) increased significantly to ¥5,812 million (+30.8% year on year), and the order backlog also grew to ¥5,840 million, which is expected to contribute to sales in the next fiscal year.
The company continues to expand overseas operations centered on DMW India. Overseas sales in FY2026 (ending March 2026) rose steadily to ¥5,449 million (+9.5% year on year). However, overseas orders received declined sharply to ¥3,369 million (-32.0% year on year), and building up the order backlog remains a challenge.
DMW Medium-Term Management Plan 2028 clearly states a dividend payout ratio target of 30% or higher. The annual dividend for FY2026 (ending March 2026) was ¥210 (payout ratio of 33.3%), an increase of ¥35 from the previous fiscal year. For FY2027 (ending March 2027), a dividend of ¥190 (payout ratio of 30.9%) is planned, reflecting the company's policy of continuing stable shareholder returns.
Last updated: July 19, 2026