Metawater

9551.THIGHScore: 56.6

Core · Weight: 25%· Data as of 2026-05-17

Also in:Ultra-Pure Water & Water Infrastructure

Investment Thesis

Japan's leading water and environmental infrastructure EPC company with a compounding overseas growth engine. FY2026: revenue ¥209.8B (+17.2%), operating profit ¥12.9B (+21.2%), ROE 9.1% (above TSE 8% target). Overseas business grew +50.4% YoY — Japan's water infrastructure expertise is being exported to Southeast Asia and Middle East at scale. PE 13.2x and forward PE 11.8x are cheap for a high-quality infrastructure franchise with recurring service revenue. Defensive business model: municipal water utilities sign multi-decade operating contracts.

Risk

1) Japan government water capex concentration — ~40-50% revenue from domestic municipalities; budget constraints risk. 2) Stock up 2.5x from 52-week low — valuation risk if overseas growth slows. 3) OP margin 5.9% is thin — project execution risk can compress margins sharply. 4) Currency risk on overseas revenue if yen strengthens significantly.

Monitoring Trigger

H1 FY2027 results (Nov 2026): if overseas revenue growth slows below 25% for 2 consecutive halves, TRIM. If overseas revenue mix exceeds 35% of total, RE-RATE higher (less domestic government dependency). PE expanding above 20x without revenue acceleration → TRIM.

Key Dates

2026-05catalystMid-term plan update details — overseas growth targets key

2026-08earningsQ1 FY2027 results

2026-11earningsH1 FY2027 results — overseas pace check

Key Metrics

13.16

11.78

Fwd PE

2.3

P/B

9.1%

ROE

5.9%

Op Margin

N/A

D/E

2.0%

Div Yield

positive

FCF

¥165B

Mkt Cap

Business Segments

Segment	Revenue	Share	Description
Environmental Engineering	¥58.4B	28%	Design and build water purification and sewage treatment plants in Japan
System Solution	¥61.1B	29%	Control systems, IoT sensors, AI-based monitoring for water facilities
Service Solution	¥33.4B	16%	Maintenance, operation management of existing water facilities (recurring revenue)
Overseas Business	¥56.7B	27%	Water infrastructure EPC and O&M in Southeast Asia, Middle East — grew +50.4% YoY in FY2026

Supply Chain Evidence

Evidence	Customer	Product	Detail
confirmed	Japanese municipalities (water utilities, sewage authorities)	Water purification plant EPC, sewage treatment plant EPC, IoT monitoring systems	Primary domestic business — 280+ municipalities served across Japan. Multi-decade contracts for operation and maintenance create recurring revenue.
confirmed	Overseas water utilities (Southeast Asia, Middle East)	Water treatment plant EPC, O&M	Overseas Business segment ¥56.7B revenue (+50.4% YoY in FY2026). Japan government METI/JICA support helps win emerging market water infrastructure contracts.
probable	Industrial facilities (manufacturing, chemical)	Wastewater treatment, recycle water systems	Industrial segment complementary to semiconductor UPW supply chain — wastewater treatment for fabs requires same expertise.

Sources & References

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