Omron's Solution-Led Automation Business Supports a Higher Midterm Margin Outlook
Omron's sensing and control-related technologies cover a broad spectrum, but we expect its profit drivers to be its industrial automation and healthcare businesses. The firm is one of the leading global players in the factory automation control and inspection equipment market (which includes programmable logic controllers, relays, sensors, and switches). As the main driver, we expect the industrial automation segment to be well positioned for secular growth, driven by an aging population in developed markets, increasing labor costs, and production safety. As trends related to the Internet of Things gain prominence, automation equipment such as PLCs will be required to connect to networks/databases in factories. Also, Omron’s recent acquisitions increased its product line, allowing the firm to provide tailored automation solutions to customers.
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