Hitachi, Ltd.【JP:6501】Stock Price

As of March 31, 2025, Hitachi, Ltd. operates 994 affiliated companies and positions three sectors as growth areas: "Digital Systems & Services," "Green Energy & Mobility," and "Connected Industries." Along with "Other," these four business segments handle product development, manufacturing, sales, and services.

Effective April 1, 2025, Hitachi is reorganizing "Green Energy & Mobility" into two separate sectors—"Energy" and "Mobility"—to enhance operational agility in energy and railway system businesses. This brings the total to five segments, enabling more specialized and efficient business operations.

Hitachi's competitive strengths lie in combining cutting-edge IT technology, OT (operational and control technology) that powers social infrastructure, and high-quality, reliable products. This integration of technology and domain expertise drives transformation in social infrastructure.

Hitachi's "Lumada" is the engine accelerating digital innovation. Lumada is a collective term for solutions, services, and technologies leveraging Hitachi's advanced digital capabilities. It illuminates customer data to create new value and insights.

The evolved Lumada positions Hitachi's extensive installed base as digitalized assets and delivers digital services that convert data collected through AI into value. This approach addresses customer challenges while contributing to solving broader societal issues.

A flagship solution is "HMAX," which incorporates AI technology. HMAX collects and analyzes real-time data from railway vehicles, signals, and other installed equipment, improving the efficiency of railway system maintenance and operations.

Hitachi's "Digital Systems & Services" segment provides digital solutions, IT products, software, and ATMs. Key business units include the Cloud Services Platform BU and Digital Engineering BU.

The "Green Energy & Mobility" segment supplies energy solutions and railway systems. Primary business units include the Power Grid BU, Nuclear BU, and Railway BU.

The "Connected Industries" segment offers building systems, lifestyle and ecosystem solutions, measurement and analysis systems, industrial and distribution solutions, water and environmental solutions, and industrial equipment. Key business units include the Building Systems BU and Industrial Digital BU.

The "Other" segment manages real estate operations including management, sales, and leasing. Major affiliated companies include Hitachi Real Estate Partners and Hitachi America.

Hitachi has formulated a new management plan called "Inspire 2027" starting April 2025 to achieve sustainable growth. The plan aims to realize a society where environment, well-being, and economic growth are in harmony, while driving innovation in social infrastructure through digital technology. In particular, Hitachi will advance its transformation into a digital-centric company centered on Lumada and strengthen its competitiveness in global markets.

To realize "One Hitachi" with digital at its core, Hitachi introduced a new business structure from April 2025. The company has reorganized its energy and railway businesses into two sectors—"Energy" and "Mobility"—and added two more sectors: "Connected Industries" and "Digital Systems & Services," for a total of four operating sectors. This restructuring will further enhance global competitiveness.

To pursue new growth, Hitachi has established a Strategic SIB Business Unit reporting directly to the CEO. This unit designates four strategic business domains—data centers, e-mobility, smart cities, and healthcare—and focuses on creating new businesses. This positions Hitachi to capture growth opportunities aligned with emerging technological innovation and social change.

Hitachi is strengthening risk management and establishing systems that enable swift management decisions. Even amid rapidly changing economic conditions, the company aims to balance threat mitigation with opportunity creation to achieve sustainable growth. Additionally, Hitachi will continue to strengthen human capital and enhance cash generation capability to deliver stable returns to shareholders.

"Inspire 2027" targets annual revenue growth of 7-9%, Adjusted EBITA margin of 13-15%, cash flow conversion of 90% or above, and ROIC of 12-13%. The company has also set "Lumada 80-20" targets—Lumada business revenue ratio of 80% and Adjusted EBITA margin of 20%—to drive business portfolio reform. These targets aim to expand the Lumada business and improve profitability.