Company Overview

1. Company Overview

Nisso <1444> was established in 1988 under the management policy of aiming to be the number one reform company in Japan, considering all employees, understanding customers, reliable suppliers, reliable subcontractors, and others related to the business as business partners with a strong relationship of mutual trust, both in name and reality.

It mainly engages in the renovation business, handling restoration work, renovation work, house cleaning, maintenance work during occupancy, and other large-scale repair work.

The main feature of the renovation business is that it operates in a blue ocean market. It specializes in small-scale and low-priced renovation work that large companies find difficult to enter or medium-scale projects. For example, actively accepting low-priced renovation work such as toilet seat replacement and responding promptly to the needs of customers such as small real estate companies and property owners. It is possible to post profits by devising business activities even in low-profit-margin business. Also, it is a characteristic to make efforts to improve the brand image in the construction industry and actively disseminate information about the company using various media such as paper media, TV commercials, and SNS. By actively disseminating information, it aims to secure personnel, improve the quality of work, and increase the number of projects that can be handled.

Japan Resort Bank Co., Ltd., which deals in buying and selling resort properties and intermediaries, started a new business from the fiscal year ending July 2024.

The capital is 3.49 billion yen, and as of the end of July 2024, the number of employees is 92 (including consolidated subsidiaries). In July 2022, it achieved listing on the Tokyo Stock Exchange Growth Market. It is currently listed on the JASDAQ Next market.

2. Business content

The company reports two segments, renovation business and a-reit etf business.

(1) Renovation Business

a) Restoration Work

Restoration work involves returning aged buildings or rooms to a condition close to new. For example, renovation work is carried out to revert the interior and water facilities to their original state before a new tenant moves in long term rentals. Restoration work mainly focuses on the interior of residential and office rental properties. In addition, interior renovation work and facility improvement work associated with the resale of real estate properties are also conducted.

b) Renovation Work

By performing relatively large-scale work, the company enhances the value by improving the functionality of residences beyond their original state. The company not only enhances to a more stylish design but also conducts renovation work to change layouts, interior and exterior designs to modern styles. Furthermore, they also carry out "skeleton renovation work" where all interiors, facilities, etc., are dismantled and rebuilt from scratch.

c) House Cleaning and Maintenance During Occupancy Work

After tenants vacate real estate properties, activities such as cleaning interiors and water facilities, internal cleaning of air conditioners, disassembly cleaning of range hoods, etc., are performed. They also undertake minor repairs such as daily maintenance of facilities, fittings, and fixtures that occur during the occupancy of rental properties.

d) Other

We conduct exterior work such as exterior construction of real estate properties, roof painting, roof replacement, rain gutter replacement, etc., as well as common area work in condominiums and apartments such as common hallways and entrances, exterior work such as gate installation and carports. We also perform various construction projects tailored to customer needs, such as large-scale renovation work on condominiums, rooftop waterproofing work.

(2) Real Estate Business

Utilizing the expertise and network cultivated in the renovation business, we officially started in July 2024. Centered around the Shonan region in the southern part of Kanagawa Prefecture and the Miura Peninsula, our 100% subsidiary Japan Resort Bank Co., Ltd. engages in brokerage and repurchase resale of resort properties. We handle real estate properties such as detached houses and condominiums with features such as facing the sea or walking distance to the beach as villas or second homes.

3. The company's strengths

We believe the strengths of our company are as follows:

(1) Relatively gentle competitive environment

By specializing in small to medium-sized renovation projects that large companies cannot make profitable, we operate in a market environment with few competitors. Even if there were competing companies, they would likely be small local renovation companies in the town, giving us a high potential to stand out in terms of cost and quality. By focusing on niches with low competition, we are able to generate profit.

(2) Direct request and order from the real estate company which is the center of customers.

Direct requests and orders from real estate companies as customers to the company are one of the factors that enable secure profit, with a low proportion of bidding projects, etc.

(3) 30 years of experience and achievements.

Having been involved in the remodeling business for over 30 years, the company has various expertise. This enables high-quality and speedy construction, allowing them to undertake over 10,000 remodeling projects annually. This expertise has established the company's position in the small to medium-sized remodeling market, which is not easily imitated by other companies.

(4) Having a large number of customers.

The total number of registered customers of the company has reached 3,011 companies nationwide, mainly centered around the Tokyo and Kanagawa areas (as of the end of July 2024). Having a large number of customers allows for many construction sites to be managed. For example, by assigning one craftsman to handle nearby sites, costs such as labor can be controlled. This enables the company to secure profits even with low-priced construction projects. Additionally, having many customers allows for stable revenue without depending on specific clients.

(5) Having a larger number of employees compared to competing companies.

As of the end of July 2024, the total number of employees of the company (including consolidated subsidiaries) was 92, with 90 employees in the remodeling business. Compared to small-scale remodeling shops in competitive regions, the company has sufficient staff to ensure the quality of each construction project even during busy periods or when projects are concentrated. Additionally, having a larger number of employees enables swift responses, which is also a strength.

(6) スピーディーな対応

同社は、何事にもスピーディーに対応することを信条としている。スピーディーな見積もりの提出・工事は、顧客の賃貸物件の空室期間の最短化にもつながる。こうした対応が、不動産会社や物件オーナー等から同社が選ばれる強みの1つとなっている。

(Written by FISCO Guest Analyst Yoichiro Shimizu)