Daiki Axis Co Ltd

### Capital Structure and Liquidity Daiki Axis has a market capitalization of ¥8,903,366,142 and a price-to-book ratio of 0.92, indicating that the market values the company slightly below its book value. The company's liquidity position is characterized as medium, with a current ratio of 1.05, suggesting a modest ability to meet short-term obligations. However, the company's net cash position is negative after subtracting total debt, which may pose a liquidity risk.

### Profitability and Returns The company's profitability is modest, with a return on equity (ROE) of 0.0012 and a return on assets (ROA) of 0.0004, both significantly below the industry median for environmental services and equipment firms. The operating margin is 5.07%, and the net margin is 0.11%, indicating that the company is generating minimal net profit relative to its revenue. These metrics suggest that Daiki Axis is underperforming in terms of profitability compared to its peers.

### Segments and Geographic Exposure Daiki Axis operates primarily in the environmental services and equipment segment, with no disclosed geographic revenue breakdown. The company's revenue is concentrated in a single business line, which may increase its exposure to sector-specific risks. The lack of geographic diversification could also limit its ability to mitigate regional economic downturns.

### Growth Trajectory The company's revenue for the latest period was ¥10,644,000,000, with a gross profit of ¥2,264,000,000. The operating income was ¥54,000,000, and the net income was ¥12,000,000. The growth trajectory is not clearly defined, as the data does not provide a multi-year revenue history. However, the company's capital expenditures were negative at ¥552,000,000, indicating a reduction in investment in physical assets.

### Risk Factors The company faces a medium liquidity risk, with a current ratio of 1.05 and a negative net cash position after subtracting total debt. The dilution risk is low, with no significant changes in shares outstanding between basic and diluted shares. The debt-to-equity ratio of 1.64 suggests a relatively high level of leverage, which could increase financial risk during periods of economic stress.

### Recent Events Recent financial filings indicate that the company has not issued new shares or raised additional capital in the latest reporting period. The operating cash flow of ¥1,525,000,000 suggests that the company is generating positive cash from operations, which is a positive sign for liquidity. However, the negative capital expenditures indicate a reduction in investment in long-term assets.

Revenue grew 6.3% annually over four years, demonstrating consistent top-line expansion for the environmental services company.

Net income surged 31% year-over-year in FY2026, indicating a strong recent recovery in profitability trends.

Operating income increased 15.8% year-over-year in FY2026, signaling improving operational efficiency and core business performance.

Cash conversion is rated best-in-class at 127.08, significantly outperforming the cohort median of 0.95.

Capex to revenue ratio is above median, suggesting prudent capital management relative to peers.

Debt-to-equity ratio stands at 1.64, placing the company in the bottom quartile of its cohort.

The company faces high credit risk, indicating significant concerns regarding its ability to meet financial obligations.

Net margin of 0.11% is well below the cohort median of 2.92%, reflecting weak profitability.

Return on equity of 0.12% lags significantly behind the cohort median of 2.1%, showing poor capital efficiency.

Revenue ¥13.28B, +3,7% YoY; Operating income −17,6% YoY.

• ▍Revenue ¥13.28B, +3,7% YoY
• ▍Operating income −17,6% YoY
• ▍Net income −13,5% YoY
• ▍Net margin 2.9%

Revenue ¥13.46B, +1,3% YoY; Operating income +33,5% YoY.

• ▍Revenue ¥13.46B, +1,3% YoY
• ▍Operating income +33,5% YoY
• ▍Net income +192,4% YoY
• ▍Net margin 2.6%

Revenue ¥11.36B, +4,1% YoY; Operating income +92,2% YoY.

• ▍Revenue ¥11.36B, +4,1% YoY
• ▍Operating income +92,2% YoY
• ▍Net income −90,6% YoY
• ▍Net margin -0.5%

Revenue ¥10.70B, +0,5% YoY; Operating income −520,4% YoY.

• ▍Revenue ¥10.70B, +0,5% YoY
• ▍Operating income −520,4% YoY
• ▍Net income −2 383,3% YoY
• ▍Net margin -2.6%

Revenue ¥12.80B; Operating income ¥750.0M.

• ▍Revenue ¥12.80B
• ▍Operating income ¥750.0M
• ▍Net margin 3.5%

Revenue ¥13.30B; Operating income ¥296.0M.

• ▍Revenue ¥13.30B
• ▍Operating income ¥296.0M
• ▍Net margin 0.9%

Revenue ¥10.91B; Operating income ¥102.0M.

• ▍Revenue ¥10.91B
• ▍Operating income ¥102.0M
• ▍Net margin -0.3%

Revenue ¥10.64B; Operating income ¥54.0M.

• ▍Revenue ¥10.64B
• ▍Operating income ¥54.0M
• ▍Net margin 0.1%

Revenue ¥48.32B, +3,2% YoY; Operating income +15,8% YoY.

• ▍Revenue ¥48.32B, +3,2% YoY
• ▍Operating income +15,8% YoY
• ▍Net income +31,0% YoY
• ▍Free cash flow −356,6% YoY
• ▍Net margin 1.0%

Revenue ¥46.82B, +9,7% YoY; Operating income +107,8% YoY.

• ▍Revenue ¥46.82B, +9,7% YoY
• ▍Operating income +107,8% YoY
• ▍Net income +71,7% YoY
• ▍Free cash flow +65,6% YoY
• ▍Net margin 0.8%

Revenue ¥42.68B, +8,1% YoY; Operating income −30,3% YoY.

• ▍Revenue ¥42.68B, +8,1% YoY
• ▍Operating income −30,3% YoY
• ▍Net income −64,3% YoY
• ▍Free cash flow −113,7% YoY
• ▍Net margin 0.5%

Revenue ¥39.48B, +4,4% YoY; Operating income −36,4% YoY.

• ▍Revenue ¥39.48B, +4,4% YoY
• ▍Operating income −36,4% YoY
• ▍Net income −6,0% YoY
• ▍Free cash flow −158,9% YoY
• ▍Net margin 1.5%