HODEN SEIMITSU KAKO KENKYUSHO CO.,LTD.
6469・Standard Market・Machinery
Business
Denki Seimitsu Kako Kenkyusho Co., Ltd. is a precision machining specialist group founded in 1961. It operates three segments: EDM & Surface Treatment (approximately 67% of net sales), Dies & Molds (approximately 26%), and Machinery & Equipment (approximately 7%). In its core EDM & Surface Treatment segment, the company provides Gas Turbine Parts Contract Machining, Aircraft Engine Parts Contract Machining, and Defense Equipment Contract Machining, as well as Surface Treatment (Thermetal Coating, etc.) based on licensed U.S. technology. Major customers include the Mitsubishi Heavy Industries group (37.3% of net sales), the LIXIL group (13.1%), and the Kawasaki Heavy Industries group (6.4%), among others. The company is listed on the Standard Market of the Tokyo Stock Exchange.
Business Model
Contract machining accounts for 95.8% of net sales (FY2025, ended February 2025). EDM (Electrical Discharge Machining) leverages proprietary technology capable of precisely processing carbide and hard-to-cut materials that are difficult to machine with general machining methods, securing continuous outsourcing demand from major manufacturers in the aviation and energy sectors. Surface Treatment achieves high added value through heat- and corrosion-resistant coatings utilizing licensed U.S. technology. In the Dies & Molds segment, overseas production is also conducted through a Thai subsidiary, while the Machinery & Equipment segment handles the sales and contract machining of the in-house developed Digital Servo Press (ZENFormer).
Company Strengths
The company possesses EDM expertise accumulated over more than 60 years since its founding in 1961, along with Thermetal Coating technology based on licensed U.S. technology. Heat- and corrosion-resistant coatings for engine parts operating in the most extreme environments represent technology that is difficult to replicate, and the company has built long-term business relationships with major aviation and energy manufacturers such as Mitsubishi Heavy Industries and Kawasaki Heavy Industries.
The EDM & Surface Treatment segment achieved net sales of ¥8,635 million (up 17.9% year on year) and operating profit of ¥1,435 million (up 95.2% year on year) in FY2025 (ended February 2025). Profitability improved significantly through the synergy of price revision effects and expanded production volume, with segment operating margin reaching 16.6%. In FY2026 (ending February 2026), net sales have expanded further to ¥9,906 million.
The equity ratio improved for three consecutive periods, rising from 27.9% in FY2023 (ended February 2023) to 41.9% in FY2025 (ended February 2025). Net assets at the end of FY2025 (ended February 2025) stood at ¥8,264 million (up ¥1,035 million from the previous period). The company has been repaying short-term and long-term borrowings, achieving expanded profitability while reducing financial leverage.
ENVALITH's Perspective
Performance Trend
Revenue has been on a recovery trend since bottoming at ¥11,680 million in FY2023 (ended February 2023), reaching a new record high in FY2026 (ended February 2026) with revenue of ¥14,313 million and operating profit of ¥1,123 million. In Q1 FY2027 (ending February 2027), revenue reached ¥4,317 million (up 20.8% year-on-year) and operating profit reached ¥561 million (up 47.5% year-on-year), demonstrating accelerating growth. External performance drivers contributing in combination include growing global electricity demand accompanying the spread of AI (Gas Turbine Parts Contract Machining), recovery in passenger and cargo demand (Aircraft Engine Parts Contract Machining), and substantial expansion of defense capability development plans (Defense Equipment Contract Machining). The phased operation of capacity-expansion equipment installed in the previous fiscal year is driving scale benefits that are pushing up profit margins, and the Q1 progress rate against the full-year forecast (revenue of ¥16,719 million and operating profit of ¥1,436 million) stands at a high level of 39.1% for profit.
Growth Strategy
Based on the Mid-Term Management Plan 2027, the company aims to improve profitability through overseas expansion in the energy and aerospace sectors and increased sales of proprietary products
The company continues the phased operation of capacity-expansion equipment installed in the previous fiscal year, responding to robust demand for gas turbine parts, aircraft engine parts, and defense equipment. Orders for EDM & Surface Treatment in the first quarter surged 142.8% year-on-year, making the expansion of supply capacity an urgent priority.
The company continuously improves profitability in the aerospace-related business by leveraging revenue growth and scale merit. Operating profit margin in the first quarter of FY2027 (ending February 2027) reached 13.0%, significantly exceeding the Mid-Term Management Plan 2027 target of an operating profit margin of 6.1%.
The company is promoting the expansion of orders for its gas turbine business in the European and U.S. markets. The weaker yen has also contributed positively at overseas subsidiaries (including in Thailand), boosting overseas sales in the Dies & Molds segment. The company is accelerating efforts to capture global demand in the defense and energy sectors.
The company has reviewed the allocation of management resources for in-house production of growth businesses and implemented appropriate price revisions. Operating profit in the Machinery & Equipment segment in the first quarter of FY2027 (ending February 2027) improved significantly to ¥113 million (up 202.2% year-on-year), reflecting the effects of structural reforms.
Last updated: July 17, 2026