ENVALITH
日東工業株式会社 logo

NITTO KOGYO CORPORATION

6651・Prime Market・Electric Appliances

Official website
日東工業株式会社 logo
NITTO KOGYO CORPORATION6651

Business

The Nitto Kogyo Group consists of the Company and 33 subsidiaries, operating in three segments: manufacturing and sale of distribution boards, cabinets, etc. (Electrical & Information Infrastructure-related Manufacturing, Construction & Service Business), procurement and sale of information and communication equipment (Distribution Business), and manufacturing and sale of electromagnetic wave and precision components (Electronic Components-related Manufacturing Business). Founded in 1948, the company is headquartered in Nagakute City, Aichi Prefecture, and operates multiple domestic plants as well as overseas locations in Singapore, Thailand, China, Vietnam, and elsewhere. Its main customers span the broader industrial sector, including electrical equipment construction contractors, construction companies, data center operators, and automobile manufacturers, and its strengths lie in a wide product lineup ranging from standard to custom-made products, together with a nationwide sales network.

Business Model

In the core Manufacturing, Construction & Service Business, the company produces and sells Distribution Boards, Cabinets, and similar products at its own factories, based on a manufacturing business model, and manages profitability through price revisions and improvements in project pricing. In the Distribution Business, it employs a trading model of purchasing and selling Information & Communication Equipment to capture demand in high-growth markets. The Electronic Components-related Business supplies EMC countermeasure components for automobiles and home appliances through a niche-focused manufacturing and sales model. The combination of these three businesses enhances resilience against economic cycles and fluctuations in demand.

Company Strengths

The company offers a product lineup ranging from standard to custom-made items, including Distribution Boards (High-voltage Receiving Equipment, etc.) and Cabinets, backed by a robust sales network covering the entire country. This has enabled the company to build a solid customer base and a competitive position in the market, with net sales of the Manufacturing, Construction & Service Business reaching ¥119,877 million in FY2026 (ending March 2026).

The Seto Plant, newly established in April 2024, has gone into full operation as a smart factory leveraging DX, achieving expanded orders for freestanding cabinets and improved production efficiency through the use of the web-based design customization service "Cabistar Smart Order." In addition, the construction of the second plant at the Tochigi Nogi Plant is underway to increase production capacity for data center system racks.

The company is enhancing collaboration in design, development, and production by leveraging its group structure of 33 companies, including Temperle Industries Co., Ltd., which became a subsidiary in April 2024, as well as Shin Aichi Electric Manufacturing Co., Ltd., Taiyo Electric Manufacturing Co., Ltd., and Kitagawa Industries Co., Ltd. R&D expenses amounted to ¥3,694 million in FY2026 (ending March 2026), as the company continues to accumulate technical expertise in areas such as EMC countermeasures, thermal management, and carbon neutrality initiatives.

ENVALITH's Perspective

In FY2026 (ending March 2026), revenue reached ¥195,783 million (97.9% of the mid-term plan target of ¥200,000 million) and operating profit reached ¥15,446 million (exceeding the mid-term target of ¥15.0 billion), already surpassing the target level in the second year of the mid-term plan. On the other hand, due to the drop-off of the ¥2,395 million gain on negative goodwill recorded in the previous period in connection with the acquisition of subsidiary shares, profit attributable to owners of parent decreased 5.0% year on year to ¥11,493 million. The volatility in extraordinary income/loss reduces the visibility of net income, and evaluation based on operating profit is considered more appropriate.

ROE declined from 10.8% in FY2025 (ended March 2025) to 9.6% in FY2026 (ending March 2026), and although it remains above the mid-term target of 9.0% or higher, room for further improvement is limited. Despite the implementation of share buybacks (¥1,219 million), net assets continued to increase, diluting the financial leverage effect. The company implemented an annual dividend of ¥152 (a decrease from ¥160 in the previous period) targeting a consolidated dividend payout ratio of 50%, and plans a slight increase to a forecast of ¥154 for FY2027 (ending March 2027). The DOE floor of 4.0% supports dividend stability, but close monitoring is warranted regarding the maintenance of dividend levels should net income growth continue to stagnate.

The company's forecast for FY2027 (ending March 2027) calls for revenue of ¥210,000 million (+7.3% year on year) and operating profit of ¥16,700 million (+8.1% year on year), representing growth in both revenue and profit. As external factors, significant increases in various material costs and the chronic labor shortage at construction sites are explicitly noted as concerns. On the other hand, increased demand associated with specification changes for high-voltage receiving equipment and the effects of price revisions implemented in the previous period are expected to support earnings. The risk of supply chain disruption due to prolonged tensions in the Middle East has not been factored into the earnings forecast, and should be noted as a downside risk.

Growth Strategy

Under the 2026 Medium-Term Management Plan, the company aims to achieve net sales of ¥210,000 million and ROE of 9% or higher by strengthening core businesses and expanding strategic businesses

Promoting the full-scale operation of the Seto Plant smart factory and improving order-taking and production efficiency through the smart order system. Production capacity for information & communication-related products such as system racks is being expanded through the construction of the second plant at the Tochigi Nogi Plant, in response to robust data center demand. Against capital expenditure of ¥5,918 million in FY2026 (ended March 2026), a significant increase to ¥12,140 million is planned for FY2027 (ending March 2027).

Developing the latest OCP ORV3 Compliant system racks and promoting business expansion of information & communication-related products for data centers. Net sales of the distribution business in FY2026 (ended March 2026) grew steadily to ¥59,956 million (+7.0% year on year), and a structure is being built to capture data center demand on both the manufacturing and distribution fronts.

Launched the mid-speed charger "Pit-QC Series" of EV/PHEV Charging Equipment (Pit-QC Series), entering the domestic charging infrastructure market. Also began field trials of electrical equipment for facility horticulture, aiming to contribute to the realization of carbon neutrality by leveraging energy management technology. This business is in a nurturing stage as a future pillar of growth.

The Kitagawa Industries Group captured orders in the domestic automotive market (net sales of ¥15,949 million in FY2026 (ended March 2026), +10.7% year on year) and benefited from a recovery in demand in the air conditioning-related market, resulting in a significant increase in segment profit to ¥1,379 million (+43.8% year on year). The company is holding seminars for overseas customers and developing non-Japanese manufacturer clients to accelerate the overseas expansion of EMC countermeasure components.

As of FY2026 (ended March 2026), the second year of the medium-term plan, net sales reached ¥195,783 million (97.9% of the ¥200,000 million target) and operating profit reached ¥15,446 million (exceeding the target of over ¥15,000 million), achieving the plan ahead of schedule. ROE was maintained at 9.6%, above the 9.0% or higher target. For FY2027 (ending March 2027), net sales of ¥210,000 million and operating profit of ¥16,700 million are planned, aiming to exceed the level of the medium-term plan targets.

Last updated: July 19, 2026