ENVALITH
大井電気株式会社 logo

Oi Electric Co., Ltd.

6822・Standard Market・Electric Appliances

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大井電気株式会社 logo
Oi Electric Co., Ltd.6822

Business

The Oi Electric Group is centered on two core businesses: the "Manufacture and Sale of Information & Communications Equipment" segment, which manufactures and sells information & communications equipment for social infrastructure such as power utilities, railways, government agencies, and telecom carriers, and the "Network Construction & Maintenance" segment, which handles construction and maintenance of communication facilities, optical networks, and CATV. In manufacturing and sales, the group handles optical transmission systems, IoT-related equipment for smart meters, and security/monitoring systems, among others, while in construction and maintenance, subsidiaries such as Nippon Field Engineering Co., Ltd. operate nationwide. Founded in 1950, the company is listed on the TSE Standard Market. Mitsubishi Electric Corporation is one of the major shareholders, and major customers include large infrastructure companies such as TEPCO Power Grid and KDDI.

Business Model

In the Manufacture and Sale of Information & Communications Equipment segment, the company sells in-house developed products to power utilities, telecom carriers, and others, recording product sales. In the Network Construction & Maintenance segment, the company provides design, installation, and maintenance of communication equipment on an integrated basis, earning construction and maintenance revenue. The two segments complement each other, forming a structure that continuously captures demand for maintenance and replacement after equipment delivery. For FY2026 (ending March 2026), sales are composed of ¥20,731 million from Manufacture and Sale of Information & Communications Equipment and ¥11,979 million from Network Construction & Maintenance.

Company Strengths

The Company has a track record and know-how in the manufacture and sale of communication functions dating back to the dawn of first-generation smart meter deployment. From FY2025, electric power companies' rollout of second-generation smart meters accelerated in earnest, and sales in the IoT-related Equipment business increased year on year. The order backlog has built up to ¥19,185 million (up 24.9% year on year), with first-mover advantage directly driving order expansion.

Building on the track record cultivated in the optical wavelength multiplexing transmission equipment business for 5G infrastructure, the Company has already developed and lined up products supporting communication speeds of up to 400G/600Gbps. In FY2026 (ending March 2026), sales in the Optical Multiplex Transmission Equipment (OTN Platform System) business increased year on year due to rising demand from telecom carriers, and sales for the Manufacture and Sale of Information & Communications Equipment segment overall reached ¥20,731 million (up 23.3% year on year).

In the final year (FY2025) of the 2023-2025 Medium-Term Management Plan, the Company achieved sales of ¥32,709 million (exceeding the plan of ¥32,100 million by 1.9%) and operating profit of ¥1,771 million (exceeding the plan of ¥1,180 million by 50.0%). Operating losses in FY2022 and FY2023 turned to profit from FY2024 onward, with operating profit improving further to ¥1,772 million in FY2026. Measures such as cost improvement, price pass-through, and product mix improvement can be confirmed as actual achievements.

ENVALITH's Perspective

The full-year forecast for FY2027 (ending March 2026) projects a significant increase in revenue to ¥40,200 million (up 22.9% year-on-year), while operating profit is forecast to decline to ¥1,600 million (down 9.7% year-on-year). This is attributed mainly to a decline in profit margin accompanying the rising share of the mass-production-type business for second-generation smart meters, increased costs for expanding production capacity and organizational structure, and higher raw material costs. It will be necessary to determine whether this structure of increased revenue but decreased profit is temporary or indicative of a structural decline in profitability.

In FY2026 (ending March 2026), foreign exchange losses surged to ¥87 million from ¥9 million in the previous fiscal year, highlighting the manifestation of exchange rate fluctuation risk associated with overseas procurement of electronic components and materials. The assumed exchange rate underlying the earnings forecast is ¥156.0 to the US dollar, with an estimated profit/loss impact of approximately ¥45 million per ¥1 depreciation of the yen. In addition, due to an increase in inventories (a cash outflow of ¥1,975 million) and other factors, operating cash flow declined significantly from ¥2,778 million to ¥1,677 million, making working capital management during the business expansion phase a key challenge.

The equity ratio improved from 29.8% in FY2025 (ending March 2025) to 31.8% in FY2026 (ending March 2026), and net assets per share rose from ¥5,364.20 to ¥6,734.55. Dividends were resumed in FY2026 (ending March 2026) at ¥70 per year, with a planned increase to ¥80 in FY2027 (ending March 2026) (payout ratio of 5.4%), marking the start of shareholder returns. On the other hand, interest-bearing debt, including short-term borrowings of ¥4,530 million, remains at a substantial level, and attention should be paid to the decline in the interest coverage ratio from 25.2 times to 17.6 times.

Growth Strategy

Aiming for sustainable growth through the expansion of second-generation smart meters and diversification into optical transmission and construction/maintenance services

In response to the full-scale rollout of communication devices for second-generation smart meters for electric power companies, the company has established a mass production system, including the start of automated line operations. Expansion into the water sector is also progressing, and the company will continue to capture demand for digitalization in the social infrastructure sector. This field is expected to remain the primary driver of sales growth in FY2027 (ending March 2027) as well.

Against a backdrop of increasing communication traffic and demand for network sophistication, the company continues to introduce new models tailored to customer needs. Through the deployment of higher value-added products, it aims to improve product mix and profitability. In FY2026 (ended March 2026), demand from telecom carriers remained solid, contributing to both higher revenue and higher profit.

Amid expected increases in costs for capacity expansion and organizational development, the company continues to pursue profitability improvement through manufacturing process efficiency and automation, cost reduction via stronger procurement capabilities, and operational efficiency through DX promotion and AI tool utilization. FY2027 (ending March 2027) is forecast to see higher revenue but lower profit, making cost management a key challenge.

In addition to stable demand from electric power companies and telecom carriers, the company is strengthening its expansion into information system construction projects and the public sector. It aims to strengthen order-taking capacity through engineer training, securing specialized personnel, and productivity improvements via ICT and outsourcing utilization. In FY2026 (ended March 2026), net sales declined slightly to ¥11,979 million (down 2.1% year on year) due to fluctuations in certain projects.

The company had not paid dividends through FY2025 (ended March 2025), but resumed an annual dividend of ¥70 in FY2026 (ended March 2026). It plans to increase the dividend to ¥80 in FY2027 (ending March 2027) (payout ratio of 5.4%). The equity ratio has improved to 31.8%, and the company intends to gradually expand shareholder returns while balancing growth investment with maintaining financial soundness.

Last updated: July 19, 2026