The Kansai Electric Power Company (9503) Investor Day 2025 summary

Financial guidance and capital allocation

• ROA for Optage has reached 15% due to efficient asset utilization, but is expected to decrease as new business areas are pursued; a consolidated group ROA of 5–5.5% is targeted for the future.

• Kanden Realty and Development aims for ROA to exceed 5% by 2025, with current levels below this due to investment cycles; peer ROA ranges from 3.4% to 4.2%.

• Free cash flow for Optage has been positive, but future investments may temporarily turn it negative before returning to positive in 5–10 years.

• Asset recycling in real estate will double, with JPY 180 billion in disposals planned by 2030, and 80% of assets already identified for this purpose.

• Capital recycling of JPY 900 billion is included within a JPY 1.1 trillion investment plan, with half of new real estate development targeted for the Tokyo Metropolitan Area and 10% for overseas.

Business overview and performance

• Operates across consumer, mobile, and business solutions, with 1.7M FTTH, 1.37M MVNO, and 100K corporate lines as of October 2025.

• Revenue grew at a 4% CAGR over the past decade, reaching ¥258.2bn in FY2025, with ordinary profit at ¥47bn and ROA at 15%.

• Annual CAPEX exceeded ¥40bn, with new investments in growth areas starting FY2025.

• Focuses on infrastructure and telecom services, leveraging a 380,000 km proprietary fiber network in Kansai.

• Aims for a balanced portfolio by 2035, with business solutions (including growth areas) exceeding 50% of revenue and targeting revenue of ¥430bn, ordinary profit of ¥75bn, and ROA of ~15%.

Strategic direction and growth initiatives

• Prioritizes rapid rollout of new consumer services, maintaining No.1 customer satisfaction for 18 years and increasing ultra-high-speed plan adoption.

• Achieved No.2 MVNO market share, focusing on enterprise IoT demand and stable subscription growth.

• Expands business solutions as a "Carrier's Carrier," providing network and data center services to other carriers.

• Optage will continue to grow both consumer and corporate businesses, leveraging its fiber network for synergies and maintaining its retail presence.

• Real estate business is shifting its revenue mix toward more capital gains (targeting 60%), with a focus on both short-term rental asset sales and long-term holdings in prime locations.