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Meidensha Corporation

6508.THIGH

Core · Weight: 12%· Data as of 2026-05-19

¥8,460+0%

6-month daily

Investment Thesis

Direct transformer bottleneck play. Power transformer lead times at 128+ weeks. FY2026 actuals (Mar 2026): Revenue ¥326.2B (+8.3%), OP ¥27.1B (+26.1% — MASSIVE BEAT vs ¥20B guidance), NI ¥23.6B (+27.8%). OP margin expanded to 8.3% (from 7.1%). FY2027 guidance: Revenue ¥355B (+8.8%), OP ¥29B (+6.9%). Numazu transformer expansion: ¥16B → 1.5x capacity, 2028 completion on track. Meiden America SC plant expansion ($9.2M) completed. Japan utility grid ¥150B+ committed. CAUTION: Orders declined -6.6% YoY to ¥358.2B; Shiller PE at 97th percentile of 10-year history.

Risk

1) VALUATION RISK: Shiller PE 35.75 at 97th percentile of 10yr history (median 18.15). Stock priced for continued multi-year expansion. 2) Order decline: FY2026 orders ¥358.2B (-6.6% YoY from ¥383.6B) — if order intake continues declining, revenue growth stalls FY2028+. 3) FY2027 NI guided DOWN to ¥22B from ¥23.6B actual (-6.9%) — possibly higher taxes or non-operating charges. 4) Toshiba T&D expanding domestic capacity — potential market share pressure. 5) Iran war geopolitical risk (TS signal) → Japanese utility capex uncertainty.

Monitoring Trigger

FY2027 Q1 results (Aug 2026): If order intake recovers above ¥100B (quarterly), HOLD at 12%. If order intake <¥80B for 2 consecutive quarters, TRIM to 8% (thesis weakening). If Shiller PE normalizes below 25x (price correction), ADD to 15%. Numazu 2028 completion on schedule — verify annually.

Key Dates

2026-08earningsQ1 FY2027 (Apr-Jun 2026) — critical: watch order intake recovery vs -6.6% decline trend

2026-H2monitoringIran war escalation impact on Japanese utility investment decisions

2026-Q3monitoringWatch for Toshiba T&D capacity expansion announcements (peer competition)

2028catalystNumazu factory expansion completion → 1.5x transformer production capacity

Update History

2026-04-14evolveHOLD

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Numazu ¥16B expansion confirmed. Transformer bottleneck worsening (128+ weeks). FY2026 OP guided down. ¥5.8B asset sale gain confirmed. Dividend raised ¥123→¥136. Added segments, supply chain.

pb:2.422.23op_margin:7.2%7.1%de:32.0%31.8%div_yield:1.5%1.6%thesis:Basic transformer thesisAdded Numazu details, Wood Mackenzie data, utility grid ¥150B+, MTP targets, Meiden America

2026-05-19evolveHOLD

View report →

FY2026 BEAT: OP ¥27.1B (+26.1%) vs ¥20B guided (35% beat). OP margin 7.1%→8.3%. CAUTION: orders -6.6%, Shiller PE at 97th percentile.

pe:17.0917.79op_margin:7.1%8.3%thesis:Transformer bottleneck, ¥20B OP guided¥27.1B OP actual (+35% beat), FY2027 ¥29B guided, Shiller PE warningrisk:FY2026 OP down to ¥20BValuation risk (Shiller PE 97th pct) + order decline -6.6%

Key Metrics

17.79

~19.5x (on FY2027 OP +6.9% guidance)

Fwd PE

2.23

P/B

~18.5%

ROE

8.3%

Op Margin

31.8%

D/E

1.6%

Div Yield

N/A

FCF

¥379B

Mkt Cap

Business Segments

Segment	Revenue	Share	Description
Power Infrastructure	¥95B	32%	Transformers, switchgear — MTP target ¥111B/¥10.5B OP by FY2027
Public, Industrial & Commercial	¥90B	30%	Power distribution, water/sewage systems
Mobility & Electrical Components	¥78B	26%	EV motors, industrial inverters
Field Service Engineering	¥38B	13%	Maintenance — highest margin segment (19% OP margin target)

Supply Chain Evidence

Evidence	Customer	Product	Detail
confirmed	TEPCO / Japanese utilities	Power transformers, switchgear	Core domestic customer. FY2026 Power Infrastructure segment revenue grew. Japan utility grid ¥150B+ investment committed 2026+.(2026-05)
confirmed	US utilities (via Meiden America)	123 kV SF6-free vacuum circuit breakers	SC plant expansion, $9.2M investment, completion May 2026
probable	Japan data center grid (indirect)	Grid-level transformers for DC power connections	No named contracts; thesis relies on utility channel demand from DC buildout

Sources & References

↗StockAnalysishttps://stockanalysis.com/quote/tyo/6508/↗Meidensha MTP 2027https://www.meidensha.com/corporate/corp_04/↗Numazu Expansionhttps://www.meidensha.com/news/news_03/news_03_01/__icsFiles/afieldfile/2025/10/30/noren.pdf ↗Transformer Shortagehttps://www.powermag.com/transformers-in-2026-shortage-scramble-or-self-inflicted-crisis/↗Japan DC Powerhttps://introl.com/blog/japan-power-crisis-hyperscaler-investment-wave-january-2026

Peer Comparison

Company	PE	Fwd PE	ROE	Op Margin	FCF
Fujitsu	17.95	18.12	15.8%	11.2%	+¥290B
Meidensha Corporation	17.79	~19.5x (on FY2027 OP +6.9% guidance)	~18.5%	8.3%	N/A
SoftBank Corp	18.8	17.5	17.42%	14.76%	+¥600B (adjusted FCF, FY2025)
SWCC Corporation	22.2	18.6	18.1%	9.84%	+¥11.1B
DAIKIN INDUSTRIES	25.16	23.48	9.26%	8.7%	N/A
Hokkaido Electric Power	4.55	6.74	10.6%	7.2%	N/A
Kandenko Co.	14	N/A	10.5%	9.0%	N/A
Fuji Electric Co.	19	N/A	13.1%	11.1%	+¥51B
Nitto Kogyo Corp.	16	N/A	10.8%	10.6%	N/A