Kyosan Electric Manufacturing Co.,Ltd.
6742・Prime Market・Electric Appliances
Business
Kyosan Electric Manufacturing Co., Ltd., founded in 1917, is a social infrastructure manufacturer listed on the Prime Market of the Tokyo Stock Exchange. In its core Signaling Systems Business, the company provides Railway Signaling Systems (ATC, interlocking devices, platform screen doors, etc.) and Road Traffic Control Systems to railway operators and municipalities both in Japan and overseas. In its Power Electronics Business, the company handles Power Supply Units for Semiconductor Manufacturing Equipment, Power Supply Units for Flat Panel Display Manufacturing Equipment, and Power Supply Units for Railway Signaling. The company operates through a group of 13 companies, including 8 consolidated subsidiaries, and has overseas bases in India, Europe, the United States, Taiwan, and China. Consolidated net sales for FY2026 (ending March 2026) reached ¥93,122 million, marking a record high for the second consecutive fiscal year.
Business Model
The company adopts a build-to-order business model, receiving individual orders from customers such as railway operators, municipalities, and manufacturing equipment makers, and providing an integrated service from design and manufacturing through delivery and maintenance. As of the end of FY2026 (ending March 2026), the order backlog stood at a substantial ¥111,430 million (of which ¥101,372 million was in the Signaling Systems Business), giving high visibility into future revenue. The Signaling Systems Business accounts for approximately 86% of net sales and the majority of segment profit, while the Power Electronics Business is undergoing structural reform.
Company Strengths
Since its founding in 1917, the company has accumulated technical expertise developing numerous products described as Japan's first or the world's first. In FY2026 (ending March 2026), it received orders for large-scale projects such as ATC ground equipment and interlocking equipment for Osaka Metro and interlocking equipment for the Nagoya Municipal Subway, maintaining ongoing business relationships with major domestic railway operators.
In FY2026 (ending March 2026), the Signaling Systems Business achieved segment profit of ¥11,950 million, a profit margin of approximately 15.0%. The order backlog stood at ¥101,372 million, up 2.8% year on year, supporting mid-term revenue. Orders received also expanded significantly, up 24.3% year on year to ¥82,559 million.
The company operates bases in India (Kyosan India Private Limited), Europe (Kyosan Europe Sp. z o.o.), the United States, Taiwan, and China (made a wholly owned subsidiary in December 2024). In FY2026 (ending March 2026), it recorded revenue from signaling equipment for India's Eastern Dedicated Freight Corridor, building up its track record overseas.
ENVALITH's Perspective
Performance Trend
Revenue increased approximately 28% over five fiscal periods, from ¥72,916 million in FY2022 (ended March 2022) to ¥93,122 million in FY2026 (ending March 2026), marking a record high for the second consecutive fiscal year. However, operating profit decreased 26.3% year-on-year, from ¥6,112 million in FY2025 (ended March 2025) to ¥4,503 million in FY2026 (ending March 2026). The factors behind this were: (1) an increase in personnel expenses and SG&A expenses (total SG&A expenses rose from ¥12,613 million to ¥13,296 million), and (2) recording of inventory disposal losses and valuation losses in the Power Electronics Business (segment loss of ¥2,339 million for this business segment). Profit attributable to owners of parent increased 5.4% year-on-year to ¥5,042 million, due to the recording of extraordinary income of ¥1,554 million, including gains on sale of investment securities. For FY2027 (ending March 2027), the company forecasts revenue of ¥90,200 million (down 3.1% year-on-year) and operating profit of ¥5,600 million (up 24.4% year-on-year), with the premise for profit recovery being a reduction in losses in the Power Electronics Business.
Growth Strategy
Under "KYOSAN Next Step 2028," the company is pursuing growth along three axes: overseas expansion, new product launches, and structural reform of the Power Electronics Business.
Enhanced production management has shortened lead times and achieved certain results, contributing to earlier recognition of sales. The company will continue to deepen these efforts in FY2027 (ending March 2027) to efficiently convert the order backlog into sales.
Building on the track record of recognizing sales for signaling equipment for the Eastern Dedicated Freight Corridor in India, the company is promoting order expansion in overseas markets. It aims to strengthen overseas competitiveness through the commercialization of the GOA2.5 automatic train operation and radio-based train control system.
The company is promoting the commercialization of an automatic train operation and radio-based train control system as next-generation railway signaling technology. It aims to expand customer value by expanding sales of maintenance-workload-reducing products utilizing CBM (condition-based maintenance for railway signaling equipment).
By integrating the production management and procurement departments and thoroughly enforcing PSI management, the company aims to minimize the occurrence of inventory. It will improve management efficiency through organizational changes, including the transfer of Power Supply Units for Railway Signaling to the Signaling Systems Business division. The Power Electronics Business plans net sales of ¥15,100 million in FY2027 (ending March 2027).
Leveraging cutting-edge power conversion technology with industry-leading efficiency, the company aims to expand its product range and market share through the launch of new products. Orders have already exceeded the previous period's level, driven by increased demand from major customers.
In FY2026 (ending March 2026), the annual dividend was ¥25 per share (up ¥2 year on year), with a dividend payout ratio of 30.7%. In FY2027 (ending March 2027), the dividend is planned to be raised to ¥27 per share (forecast payout ratio of 39.7%). The company also carried out share buybacks of ¥500 million during the current period, further strengthening its overall approach to shareholder returns.
Last updated: July 19, 2026