ENVALITH
協立電機株式会社 logo

KYORITSU ELECTRIC CORPORATION

6874・Standard Market・Electric Appliances

Official website
協立電機株式会社 logo
KYORITSU ELECTRIC CORPORATION6874

Business

Kyoritsu Electric Co., Ltd. was founded in 1959 and is headquartered in Shizuoka City, listed on the Tokyo Stock Exchange Standard Market. Its core business is the development, manufacturing, and sales of the "Intelligent FA System (Total Solution)," an area combining FA technology and IoT, primarily serving manufacturing sites and R&D departments of manufacturing companies. The group consists of the company, 22 subsidiaries, and 1 affiliate, operating on two pillars: the Intelligent FA Systems Business and the IT Control & Scientific Measurement Business. Since 2001, the company has actively pursued overseas expansion, building an overseas subsidiary network of 11 companies across 8 countries: China, Thailand, Malaysia, Canada, India, Vietnam, Indonesia, and the Philippines.

Business Model

The company's earnings pillars consist of two segments: the Intelligent FA Systems Business (net sales of ¥16,970 million for FY2025 (ended June 2025)) and the IT Control & Scientific Measurement Business (net sales of ¥21,680 million for the same period). The former provides high value-added systems developed and manufactured in-house, while the latter serves a technical trading company function handling FA Equipment / Control Equipment and measuring instruments. Through a "One Stop Shopping" model that provides end-to-end support from planning and design through manufacturing, installation, construction, and maintenance, the company reduces customers' costs of managing multiple suppliers, while expanding the scope of orders and improving profitability across the group as a whole.

Company Strengths

From FY2021 (ended June 2021) to FY2025 (ended June 2025), net sales expanded from ¥27,294 million to ¥38,246 million. Operating profit grew approximately 2.7-fold, from ¥1,248 million to ¥3,355 million. In FY2025 (ended June 2025), the consolidated ordinary income margin reached 9.0%, exceeding the company's own target of 8%. Five consecutive years of revenue and profit growth underpin financial stability.

Since 2001, the company has proactively pursued overseas expansion, establishing 11 overseas subsidiaries across 8 countries: China, Thailand, Malaysia, Canada, India, Vietnam, Indonesia, and the Philippines. It has built a system with multiple sites in China, Malaysia, India, and Vietnam to capture, on the ground, demand arising from the overseas relocation of Japanese manufacturing.

In June 2017, the company established an R&D center in Shizuoka City, which functions as a hub for strengthening the group's overall technological capabilities. It also established Kyoritsu Electric Corporation (Canada) as a central research institute to advance basic research on embedded systems. In FY2025 (ended June 2025), R&D expenses amounted to ¥267 million, with a focus on developing new technologies such as flying prober technology and road deflection inspection vehicles (MWD).

ENVALITH's Perspective

For the nine months ended Q3 FY2026 (ending June 2026), the Intelligent FA Systems Business posted net sales of ¥13,647 million (up 5.7% year on year) and operating income of ¥2,081 million (up 6.6% year on year), remaining solid. Against the full-year forecast (net sales of ¥40,000 million and operating income of ¥3,450 million), the nine-month progress rate stood at 71.4% for net sales and 79.0% for operating income, indicating generally favorable progress. As the earnings forecast has not been revised from the figures announced on August 13, 2025, the probability of achieving the full-year targets is judged to be reasonably high.

For the nine months ended Q3, the IT Control & Scientific Measurement Business posted net sales of ¥14,887 million (down 10.6% year on year) and operating income of ¥986 million (down 8.4% year on year), a substantial decline in both revenue and profit. Management has explained that external factors such as US tariff policy and Middle East tensions temporarily dampened customer purchasing appetite, and continued attention is warranted regarding the risk that prolonged geopolitical risk could delay the business's recovery. As this business is the company's mainstay, accounting for approximately 52% of consolidated net sales, its impact on overall performance is not negligible.

For the nine months ended Q3 FY2026 (ending June 2026), net sales came to ¥28,572 million (down 3.5% year on year), a decline, while quarterly net income attributable to owners of the parent increased to ¥1,935 million (up 5.4% year on year), securing profit growth. The gross profit margin improved to 22.8% from 20.4% in the same period of the previous year, suggesting that a shift toward higher value-added products and services is contributing to a qualitative improvement in the earnings structure. It should also be noted that a gain on sale of investment securities of ¥241 million (recorded as extraordinary income) boosted net income, representing a one-time factor.

Growth Strategy

Three-pillar strategy combining deepening of "One Stop Shopping" initiatives, overseas expansion, and capture of DX/IoT demand

Deepening collaboration among group companies to pursue innovation discovery, expansion of order scope, and improved profitability. In the Intelligent FA Systems Business, cumulative results for the third quarter achieved year-on-year increases of +5.7% in revenue and +6.6% in profit, confirming the effectiveness of the initiative.

Responding to expanding demand for shipping inspection equipment and various inspection equipment driven by increased capital investment utilizing IoT, as well as the expanding application range of automation systems such as robot systems. Against the backdrop of diversifying and increasingly sophisticated customer needs, the added value of this business is rising, contributing to an improvement in gross profit margin (from 20.4% in the same period of the previous year to 22.8% in the current period).

Utilizing the overseas subsidiary network of 11 companies in 8 countries to capture local capital investment demand accompanying the offshoring of manufacturing operations. The foreign currency translation adjustment account increased from ¥153 million at the end of the previous fiscal year to ¥241 million, reflecting the expansion of overseas business also on the financial side. Responding to geopolitical risks such as U.S. tariff policy will be a challenge going forward.

Last updated: July 17, 2026