Japan IT Services & Software

Research evidence excerpt

Japan IT Services & Software

Macquarie Equity Research Japan IT Services & Software

Valuations and recommendations

Our qualitative views on sub-sectors and companies are:

• Hitachi, NEC, Fujitsu, and NRI possess the capabilities required to shift their offerings

toward SoA. In particular, we believe Hitachi's HMAX is commercialising Physical SoA

solution.

• OBIC has historically been centred on SoR software (ERP) and continues to deepen its

capabilities in SoE and SoI. However, we view its SoA strategy as relatively conventional

rather than agentic, and believe further progress should be monitored.

• BayCurrent, as a consulting-led player, lacks the same track record in SoR ownership.

However, given Japanese enterprises' slow IT adoption – driven by organisational

complexity, cultural factors, and resource constraints – we expect continued demand for

SoR, SoE, and SoI implementation projects.

• Otsuka Corporation possesses the capability to provide a comprehensive suite of

enterprise systems to SMB customers. However, given its customer base, we expect SoR,

SoE, and SoI implementation to remain the primary growth driver in the near term.

• Within SaaS, the evolution toward SoA is likely to emerge through AI-enabled BPO and

digital workforce solutions, with Money Forward currently leading this transition. Sansan

has spent recent years strengthening its SoR and SoI capabilities, and we see potential

for further expansion into SoE and SoA. OBC, Money Forward, and freee benefit from

ownership of accounting and HR systems, providing a strong SoR foundation. Rakus has

a strong customer base, but its product portfolio provides a workflow SoR position, which

sometimes appears to have less competitive edge, although its SoE and SoI capabilities

continue to develop.