3937 Ubicom
- Japan Guru
- Apr 27
- 1 min read
Ubicom operates (i) offshore system development outsourcing and (ii) development of proprietary software for medical sector. Actively hiring locally at the Philippines branch
top of page
No.1 English-language social media platform for Japanese stocks
Powered by Japan Guru
3 Comments
bottom of page
"[Offshore IT biz] is low margin and accounts for just one-third of total operating income. In addition it has been hit by a double whammy of tariff uncertainty (manufacturing clients are demanding price cuts) and geopolitical frictions (they have been forced to downsize China ops, incurring restructuring costs)."
"if the company can’t get operating margins back to the mid to high teens in this [offshore IT] division they will likely sell it. This would be a VERY positive development. It would leave a pure play healthcare consulting company selling high-margin cloud-based subscription services into an underpenetrated market. This would deserve a much higher multiple than the 6x EV/EBIT that Ubicom currently trades at."
https://x.com/RocksOver/status/1930426677097836706
This co basically runs two biz segments: (i) SIer (ii) Medical sector SAAS
(i) is responsible for 73% of all rev, but (ii) accounts for 67% of all op
OP margin for the medical SAAS is 65.5%, and stays on a growth trajectory
At share price of 985 yen, 12 bil yen mkt cap vs 4.5 bil yen in net cash
12.6x per (7.8x adjusted for net cash) / 2.16x pbr / no div
This medical system developer absorbed the rising labor costs, and managed to deliver yoy 23% growth in op for FY ended March 2025
Japan's society-wide "work style reforms" continue to provide a tailwind, with demand growth for Ubicom's online software for doctors and medical claim inspections. Sales to insurance companies also contributed