KYOKUTO SECURITIES CO., LTD.
8706・Prime Market・Securities & Commodity Futures
Business
Kyokuto Securities Co., Ltd. is an independent securities company founded in 1947, listed on the Prime Market of the Tokyo Stock Exchange. Guided by its management philosophy "Trust is the foundation of all things," the company has consistently maintained a Face to Face, in-person business model. Its principal businesses are the sale and purchase and brokerage of securities, underwriting and secondary distribution, and handling of public offerings and secondary distributions, with affluent individual investors as its main customer base. Its consolidated subsidiaries include FE Invest (Investment Fund Management & Proprietary Investment), which operates investment funds, Kyokuto Property, which manages branch real estate, and Kyokuto Securities Economic Research Institute, which conducts research; however, their impact on consolidated financials is minimal, and the company operates in substance as the Investment and Financial Services Business (Single Segment).
Business Model
Revenue is composed of four main layers: ① commissions received (equity brokerage, investment trust sales, trust fees, etc.), ② bond and equity trading gains/losses, ③ financial income (bond interest and distribution income), and ④ gains on sales of investment securities (extraordinary income). Against a backdrop of high customer loyalty built through face-to-face sales, the company expands assets under custody and steadily accumulates commission income, while gains on sales and dividend income from long-term pure investment using proprietary capital add depth to overall earnings, forming the structure of its revenue base.
Company Strengths
The proportion of new account openings triggered by referrals from existing customers reached 65.2% in the current fiscal year's results. In the CX index survey conducted in FY2025, the score improved steadily to 6.52 (up from 5.51 in the previous survey in FY2022), with particularly high ratings for "kind and courteous service." The face-to-face sales model enhances customers' intent to continue and recommend the service, contributing to the stable expansion of the customer base.
The capital adequacy ratio at the end of the current fiscal year stood at 453.8%, maintaining a high level that significantly exceeds the statutory requirement. Backed by total net assets of ¥52,509 million, the company achieved gains on sales of investment securities of ¥3,128 million, demonstrating financial strength that enables proactive financial management. It also secured a commitment line of ¥4.6 billion (total amount), managing liquidity risk appropriately.
Sales of investment trusts performed well throughout the year, with commissions from offerings and sales handling expanding to ¥1,412 million (up 15.9% year on year), and other commissions received, including trust fees, expanding to ¥878 million (up 35.4% year on year). Both the number of customer accounts with assets under custody of ¥10 million or more and the total balance of assets under custody increased, with the company's ability to propose "distinctive seasonal products" contributing to a qualitative improvement in earnings.
ENVALITH's Perspective
Performance Trend
Operating revenue fell sharply from ¥6,492 million in FY2022 to ¥4,315 million in FY2023, then rose for three consecutive periods: ¥7,730 million in FY2024, ¥7,989 million in FY2025, and ¥8,317 million in FY2026. Operating income turned to growth for the first time in two periods, reaching ¥3,039 million in FY2026 (up 12.9% year on year). As external factors, the Nikkei Average rose 43% from the end of the previous period (closing the period at ¥51,063), boosting stock brokerage commissions, while continued yen depreciation (closing the period at ¥158.75 to the dollar) contributed to an increase in financial income. On the other hand, the rise in Japan's long-term interest rate (closing the period at 2.345%) weighed on bond trading gains/losses, which fell 29.0% year on year. Comprehensive income was ¥5,129 million (a significant improvement from ¥2,095 million in the previous period), and net unrealized gains on other securities also increased by ¥339 million.
Growth Strategy
Continued pursuit of three pillars: diversification of revenue sources, accumulation of investment trust balances, and proactive financial management
The handling volume of beneficiary certificate offerings and secondary sales expanded to ¥153,612 million (up 30.1% year on year), and trust fee income and other commissions received reached ¥878 million (up 35.4% year on year). The expansion of balance-linked income has contributed to stabilizing earnings against market fluctuations, and this continues to be promoted as a key initiative.
The company has actively conducted purchases and sales of investment securities from the perspective of efficient utilization of shareholders' equity. In FY2026 (ending March 2026), proceeds from sales of ¥11,211 million and expenditures for acquisitions of ¥5,485 million secured investing cash flow of ¥6,013 million, realizing extraordinary income of ¥3,128 million. The balance of investment securities stood at ¥26,188 million as sales progressed, and future changes in the capacity for further sales will be a point of focus.
While maintaining the policy of not disclosing consolidated earnings forecasts, the company continues the alternative measure of announcing preliminary figures targeting within 10 business days of the fiscal year-end or quarter-end. The financial results for FY2026 (ending March 2026) were announced on April 24, 2026, demonstrating that the early disclosure policy is being implemented.
Last updated: July 19, 2026