Intrinsic Value Ic Co., Ltd. (4769.T)

• Previous Close: ¥1,045.00
• Intrinsic Value: ¥733.98
• Upside potential: -30%

Stock Valuation Context

Business Model And Market Position

Information Creative Co., Ltd. operates in the information technology services sector, specializing in software development, system integration, and infrastructure design for diverse industries. The company serves private enterprises, public organizations, and financial institutions, offering tailored solutions such as web-based and embedded systems, operational support, and package software for niche markets like ticketing and hairdressing. Its revenue model is project-based, combining consulting, development, and maintenance services. With a strong foothold in Japan, the company leverages its long-standing expertise since 1978 to maintain a competitive edge in system integration and operational efficiency. Its focus on both private and public sector clients ensures diversified revenue streams, while its proprietary software for specialized industries adds a recurring revenue component. The company’s market position is reinforced by its ability to deliver end-to-end IT solutions, though it faces competition from larger global and domestic IT service providers.

Revenue Profitability And Efficiency

In FY 2024, the company reported revenue of ¥9.29 billion, with net income of ¥384 million, reflecting a net margin of approximately 4.1%. Operating cash flow stood at ¥509.5 million, while capital expenditures were minimal at -¥3 million, indicating efficient capital deployment. The diluted EPS of ¥51.65 underscores steady earnings generation relative to its share count.

Earnings Power And Capital Efficiency

The company demonstrates moderate earnings power, with a net income of ¥384 million and an operating cash flow of ¥509.5 million. Its capital efficiency is notable, as evidenced by negligible capital expenditures and a debt-free balance sheet, allowing for reinvestment in growth or shareholder returns.

Balance Sheet And Financial Health

Information Creative maintains a robust balance sheet, with cash and equivalents of ¥4.07 billion and no debt, highlighting strong liquidity and financial stability. This conservative financial structure positions the company well to navigate economic uncertainties or invest in strategic initiatives.

Growth Trends And Dividend Policy

The company’s growth appears steady, supported by its diversified client base and recurring service revenue. It pays a dividend of ¥35 per share, reflecting a commitment to shareholder returns, though its payout ratio and yield would depend on future earnings sustainability.

Valuation And Market Expectations

With a market cap of ¥7.43 billion and a beta of 0.033, the stock exhibits low volatility relative to the market. The valuation metrics suggest a conservative market perception, likely reflecting its niche focus and moderate growth prospects in the competitive IT services sector.

Strategic Advantages And Outlook

The company’s strategic advantages include its long-standing industry presence, diversified client portfolio, and debt-free financial position. However, its outlook depends on its ability to scale niche software offerings and compete with larger IT service providers. Continued focus on operational efficiency and client retention will be critical for sustained growth.

Sources

Company filings, market data