【JP:4430】Stock Price

Tokai Soft is an independent software development company specializing in custom development and development-related services. Working with subsidiaries and partner companies, the company develops embedded control software for automotive and home appliances, monitoring and control systems for factories and logistics, and business systems. It also offers the IoT package "FlexSignal" and DX support solution "PlusFORCE".

The company's major customers include automotive manufacturers, equipment makers, manufacturing and distribution companies, as well as leading financial institutions, government agencies, and local authorities. Many projects are received as a partner to major system integrators. Revenue comes primarily from custom development and staff dispatch services as needed, combining stable income from long-term, large-scale projects with revenue stabilization from short-term projects.

The company operates its business across three divisions: embedded systems, manufacturing/distribution and business systems, and finance/public sector. In the embedded division, it focuses on automotive electrical control, connected vehicles, autonomous driving, and electrification. In the manufacturing and distribution division, it provides monitoring and control for production lines and logistics, and supports IoT and AI utilization. In the finance and public sector division, it strengthens quality management and information security measures for large-scale projects to expand orders.

Under its medium-term management plan, the company is pursuing "embracing transformation to reach a new stage of stability and growth," with clear numerical targets for improved profitability. The company aims for an operating profit margin of 10% or higher and a return on equity (ROE) of 10% or higher. It plans to enhance profit margins through expanded orders for high-value-added projects and strengthened project and quality management, while balancing returns to employees with shareholder returns. Specifically, the company is maintaining long-term relationships with existing customers while strengthening engineer training and recruitment to secure new orders, thereby stabilizing its revenue base and leveling sales.

Priority investment areas focus on three sectors: embedded software as the core, vehicle-related systems, and manufacturing/distribution monitoring and control systems plus business systems. The company is prioritizing investment in vehicle electrical control software, autonomous driving and electrification development, the IoT package "FlexSignal" for factory DX, and the DX support service "PlusFORCE." The company positions its long-cultivated on-site knowledge in manufacturing and its one-stop proposal capabilities as key differentiators, aiming to deliver high-quality, reliable services through "selection and concentration" on major customers and core technologies.

For new market development and business expansion, the company is shifting toward vehicle-related development based on vehicle software platforms and expanding operations into the Kanto region. It is creating new business models through technical collaboration and partnerships with package makers, while also targeting digital government services in the public sector. On the workforce front, the company is strengthening recruitment of recent graduates, second-career hires, and mid-career professionals, expanding these to represent approximately 25% of annual hiring. Outsourcing has also expanded, with outsourcing costs increasing approximately 22% year-over-year and contributing to growth. Additionally, the company is strengthening production capacity through M&A execution.

In technology innovation, the company views artificial intelligence (generative AI), business automation tools (RPA), cloud services, and autonomous mobile robots as business opportunities and prioritizes internal demonstration and application. Specifically, the company first pursues operational efficiency improvements through internal implementation, then applies this experience to customer proposals. Concurrently, the company is focusing on reskilling and multi-skilling of engineers, contributing to manufacturing challenges across technology, quality, and cost dimensions, thereby advancing software development that supports sustainability (SDGs).