Sotetsu Holdings,Inc.

Business Details

Comprises the railway business operated by Sagami Railway and the bus business operated by Sotetsu Bus. The segment provides passenger transport services mainly along the Sotetsu Line in Kanagawa Prefecture, and strengthens access to central Tokyo through direct operation with JR and Tokyu via the Sotetsu Shin-Yokohama Line. As a foundational segment supporting the enhancement of line-side value across the entire Group, it continues to implement measures to improve convenience in both railway and bus operations.

Recent Overview

Both operating revenue and profit increased year on year. Convenience-enhancing measures were promoted through new rolling stock introduction and station facility renewal.

In FY2026 (ending March 2026), overall operating revenue (external customers) for the Transportation Business was ¥44,375 million (up 3.5% year on year), and segment profit was ¥5,727 million (up 16.6% year on year), representing increased revenue and profit. The company implemented convenience-enhancing measures including the construction of eight new 13000 series railcars, the opening of the central second-floor gate at Ebina Station, the renewal of automatic ticket gates at 10 stations, and the start of mutual use of touch-payment boarding services. In the bus business, revenue-generating capability was strengthened through EV bus introduction and fare revisions. Construction to eliminate grade crossings near Tsurugamine Station continued. For the next fiscal year (FY2027, ending March 2027), operating profit for the Transportation Business is forecast to decrease to ¥4,800 million (down 16.2% year on year) due to an increase in operating expenses related to the Sotetsu Shin-Yokohama Line, among other factors.

Key Products

Growth Drivers

• Establishment of regular and non-regular ridership on the Sotetsu Shin-Yokohama Line and expansion of passenger revenue
• Improved convenience and promotion of usage through timetable revisions, introduction of touch payment, and campaign measures
• Strengthening of revenue-generating capability in the bus business through fare revisions, resumption of new routes, and introduction of EV buses
• Boosting of line-side demand through line-side development projects such as the Yumegaoka area
• Enhancement of safety and convenience through the Ebina Station improvement works and the grade-crossing elimination construction near Tsurugamine Station

Risks

• Long-term risk of declining transport demand due to population decline along the line caused by the falling birthrate and aging population
• Increased costs of maintaining the route network due to difficulty securing personnel, including a shortage of bus drivers
• Pressure on next-period profit from increased operating expenses related to the Sotetsu Shin-Yokohama Line (FY2027 (ending March 2027) operating profit forecast at ¥4,800 million, down 16.2% year on year)
• Burden of renewal investment due to aging railway and bus infrastructure (increase in tangible and intangible fixed assets of ¥11,151 million)
• Increased operating costs due to rising energy prices
• Risk of temporary decline in convenience due to large-scale construction projects (such as grade-crossing elimination works)