Orders are accumulating at HVAC and facilities subcontractors against a backdrop of expanding data center and factory investment. With Nihon Dengi as the benchmark stock, this article presents 20 selected companies, focusing on their latest earnings and order data for data centers and factories.
The total orders received by the 20 major companies disclosed by the Ministry of Land, Infrastructure, Transport and Tourism for fiscal 2025 amounted to ¥5.2403 trillion, up 19.4% from the previous fiscal year. Growth was particularly strong in building services work covering air conditioning and sanitation, with data center and factory investment driving orders. As part of data center-related investment, Microsoft announced in April 2026 that it would invest approximately $100 billion in AI infrastructure over four years, and plans are in place for new and expanded data centers in Japan by 2030. These developments are expected to increase demand for GX strategic-area designations centered on data centers and for liquid-cooling systems.
Cooling and power-supply equipment for data centers and semiconductor plants are at the core of the construction work, influencing the competitiveness of subcontractors specializing in air-conditioning controls. While the five major companies are posting record-high profits, their share prices have at times corrected by approximately 20% from their year-to-date highs amid rising material costs and interest rates. The focus on orders is increasingly shifting from quantity to quality, and market participants continue to assess future performance in anticipation of the next fiscal year and beyond.
Nihon Dengi, a specialist in air-conditioning controls, posted record revenue of ¥46.3 billion, up 7.7% from the previous fiscal year, and operating profit of ¥11.8 billion, up 29.6%. Its operating margin reached 25.5%, demonstrating high profitability. Orders received in April–June 2026 amounted to ¥16 billion, up 30.8% year on year, while carried-over construction orders rose to ¥36.5 billion. The company plans to shift to progressive dividends, targeting a payout ratio of at least 40%, and forecasts a dividend of ¥56.
Hibiya Engineering recorded a sharp increase in data center-related orders, with orders received in April–June 2026 reaching ¥56 billion and outstanding construction orders totaling ¥141.3 billion. Data centers and information-related work accounted for most orders, and verification and installation of cooling equipment are progressing through collaboration with NTT Data and IIJ. The company targets a payout ratio of 50% and forecasts a dividend of ¥110, including a commemorative dividend for its 60th anniversary, although its high dependence on data center projects and the risk of back-loaded earnings in the second half require attention.