ENVALITH
セコム株式会社 logo

SECOM CO., LTD.

9735・Prime Market・Services

Official website
セコム株式会社 logo
SECOM CO., LTD.9735

Business

Secom Co., Ltd. originated as Japan's first security services company, established in 1962, and now forms a large-scale group comprising 148 consolidated subsidiaries and 17 equity-method affiliates. Led by its core Security Services business (approximately 52.6% of consolidated net sales), the company operates across seven segments, including Fire Prevention, Medical Services, Insurance, Geospatial Information Services, BPO, ICT, and Real Estate Leasing. In addition to serving domestic corporate and individual customers, the company operates in 18 countries and regions, guided by its corporate philosophy of building a "social system industry" that realizes a society that is "safe, secure, comfortable, and convenient." Consolidated net sales for FY2026 (ending March 2026) reached a record high of ¥1,256,896 million.

Business Model

In the core security services business, monthly contracts for the centralized system integrating sensors, communications, and emergency response (security contract revenue of ¥555,133 million) form the foundation of recurring revenue. This is supplemented by flow-type revenue such as on-site guarding and safety product sales. Peripheral businesses including disaster prevention, insurance, BPO, and ICT leverage cross-selling with the security customer base and their own specialized expertise to diversify revenue streams, achieving a stable and multi-layered revenue structure across the group as a whole.

Company Strengths

Since its founding in 1962, the company has accumulated Japan's first online security system development and sales business, building security contract revenue of ¥555,133 million (FY2026, ending March 2026). The monthly subscription-based recurring revenue model has a low cancellation rate, and combined with the effect of price revisions (increases), external customer sales for the period continued to grow steadily, up 4.3% year on year.

The seven segments—Security, Disaster Prevention, Medical, Insurance, Geospatial Information, BPO, ICT, and Real Estate—mutually share customer base, technology, and brand. In FY2026 (ending March 2026), all segments achieved revenue growth, and operating profit reached a record high of ¥160,333 million (up 11.1% year on year). Dependence on any single business is low, providing high resilience to economic fluctuations.

As of the end of FY2026 (ending March 2026), the equity ratio stood at 58.9%, and against interest-bearing debt of ¥68.7 billion, the company held cash and cash equivalents of ¥406,675 million. The cash flow to interest-bearing debt ratio was 0.3 years, and the interest coverage ratio was 138.4x, indicating extremely high financial soundness and maintaining the ability to flexibly allocate funds toward M&A and capital expenditure.

ENVALITH's Perspective

The operating margin for FY2026 (ending March 2026) improved to 12.8% (from 12.0% in the prior period). The improvement was driven by three businesses: the Disaster Prevention business (operating profit up 23.1% year-on-year on cost ratio improvement), the Insurance business (up 41.2% year-on-year on lower natural disaster losses and reduced SG&A expenses), and the Geospatial Information Services business (up 55.9% year-on-year on cost ratio improvement and SG&A reductions). However, the improvement in the loss ratio in the Insurance business depends heavily on the external factor of fewer natural disasters, and its continuity needs to be assessed. The improvements in Disaster Prevention and Geospatial Information appear to be the result of structural strengthening of cost management, and their sustainability is relatively higher.

In the BPO/ICT business, revenue growth was limited to 1.1% year-on-year, and operating profit declined 1.9% year-on-year due to increased costs associated with the launch of a new data center. Recovery of the data center investment is expected to take time. In addition, gains from investment partnerships within non-operating income sharply declined by ¥12,360 million, from ¥21,202 million in the prior period to ¥8,842 million in the current period, limiting the growth in ordinary income to 4.0%. The company's forecast for FY2027 (ending March 2027) projects a decline in profit, with ordinary income of ¥176,000 million (down 3.4% year-on-year) and net income of ¥105,800 million (down 6.1% year-on-year). Understanding the normalized level of gains from investment partnerships will be a key point for investment decisions.

From May to November 2025, the company repurchased 11,190,100 shares of treasury stock for ¥59,999,874,700, and in May 2026 resolved to conduct additional repurchases and cancellations. The annual dividend for FY2026 (ending March 2026) is ¥100 (up ¥2.5 year-on-year), with a payout ratio of 36.2%. For FY2027 (ending March 2027), an annual dividend of ¥120 (up ¥20 year-on-year) is planned, with the payout ratio expected to rise to 45.9%. As a market context, the company's selection for the Nikkei 500 Shareholder Return Stock Index (October 2025) also reflects the market's assessment of its shareholder return stance. While the substantial dividend increase amid a forecasted decline in net income indicates significant financial capacity, the sharp rise in the payout ratio warrants close attention from a sustainability perspective.

Growth Strategy

Under the '2040 Vision,' the company is evolving toward proactive safety and security services, accelerating growth through DX, overseas expansion, and M&A.

In May 2026, the company formulated the 'Secom Group 2040 Vision.' It set out an evolution toward proactive services that capture warning signs before incidents occur, and is advancing the 'Anshin Platform Concept' (Anshin meaning safety/security), which combines data, technology, and expertise with the 'fusion of people and technology.' This has clarified the direction of medium-term business transformation.

The security robot 'cocobo' passed the conformity examination for remotely operated small vehicles in March 2025, becoming the first robot provided by a security company to be permitted to travel on public roads. The company is providing advanced security through the fusion of people and robots across diverse locations. It also continues to expand sales to households through the addition of new features such as facial recognition capability in 'Secom Home Security NEO.'

In October 2025, the company made AVTEL Holdings Pte. Ltd., a global security SI company whose main customers include data center operators, a wholly owned subsidiary (acquisition amount: ¥10,065 million). For data centers being built successively around the world, the company is providing consulting, sales, and construction for unified security systems spanning multiple countries and regions, thereby strengthening its overseas revenue base.

For FY2027 (ending March 2027), the company expects revenue growth across all business segments, forecasting net sales of ¥1,313,500 million (up 4.5% year on year) and operating income of ¥165,500 million (up 3.2% year on year). Due to the normalization of gains from investment partnerships, ordinary income and net income are forecast to decline, but the company plans to continue steady growth in operating income from its core businesses.

The company conducted share buybacks totaling approximately ¥60,000 million between May and November 2025, and resolved in May 2026 to conduct additional buybacks and share cancellations. The annual dividend for FY2027 (ending March 2027) is planned at ¥120 (an increase of ¥20 year on year), raising the dividend payout ratio to 45.9%. Supported by robust operating cash flow (¥203,566 million), the company continues its policy of balancing growth investment with shareholder returns.

Last updated: July 19, 2026