Mitsubishi Heavy Industries joins Infosys’ Japan JV—What this digital procurement move means for Asia’s supply chains

How Will Mitsubishi Heavy Industries’ Investment Boost Digital Procurement In Japan?

Mitsubishi Heavy Industries has taken a strategic step to reinforce its digital transformation ambitions in procurement by joining HIPUS, a joint venture (JV) led by Infosys, through a minority stake acquisition. HIPUS, which was established in 2019 by Infosys to streamline procurement processes for Japanese enterprises, will now count the Japanese industrial giant as a shareholder, following the acquisition of a 2% stake by Mitsubishi Heavy Industries. The transaction is expected to close by the end of the first quarter of fiscal year 2026, subject to regulatory approvals and customary conditions.

Headquartered in Tokyo, Mitsubishi Heavy Industries is one of Japan’s most prominent industrial conglomerates with operations spanning aerospace, defense, smart infrastructure, industrial machinery, and energy systems. The decision to invest in HIPUS highlights MHI’s intent to modernize its value chain by integrating advanced procurement analytics, digital sourcing tools, and category management services developed under the Infosys-led platform.

HIPUS (Hybrid Procurement Unified System), in which Infosys retains a majority ownership, was initially created to support Japanese corporations in digitising their procurement and sourcing operations. By leveraging Infosys’ global delivery capabilities, domain-specific expertise, and AI-powered digital platforms, HIPUS aims to deliver greater transparency, efficiency, and agility to traditional supply chain workflows.

What Does The Infosys-MHI Partnership Mean For Procurement Transformation?

Mitsubishi Heavy Industries was already a long-term client of HIPUS, making this investment a natural progression in their collaboration. According to Infosys BPM CEO Anantha Radhakrishnan, who also chairs the HIPUS board, this partnership reaffirms Japan’s strategic importance in Infosys’ regional expansion plan. He added that the investment reinforces Infosys’ goal of nurturing long-term trust with clients in Japan and accelerating their transition to modern digital business process platforms.

For MHI, the investment aligns with its broader value chain digitalisation strategy. The company aims to strengthen its procurement systems through data analytics, driving value across sourcing, spend analysis, supplier relationship management, and contract optimization. Isao Miyake, Head of Value Chain Headquarters at Mitsubishi Heavy Industries, stated that HIPUS’ analytical capabilities would support better decision-making across procurement functions and contribute to generating long-term cost and process efficiencies.

How Is HIPUS Expanding Its Reach Beyond Japan?

HIPUS CEO and Representative Director Kiyoshi Asami indicated that MHI is not only a major client within Japan but also a partner whose services are being delivered in regions beyond domestic markets, enabled by Infosys’ international delivery infrastructure. This aligns with HIPUS’ ambition to evolve from a Japan-specific procurement solution provider into a globally integrated procurement transformation platform.

HIPUS’ core offerings combine sourcing expertise with technology-driven process optimisation tools tailored for large-scale industrial players. With MHI now on board as both a client and stakeholder, HIPUS gains additional credibility in the Japanese market, while potentially opening doors for further partnerships with other industrial heavyweights seeking similar supply chain modernisation.

How Does This Fit Into Infosys’ Broader Asia-Pacific Strategy?

Japan has emerged as one of Infosys’ most critical markets within the Asia-Pacific region. The country’s manufacturing sector, in particular, presents a significant opportunity for technology-led process optimisation, especially as firms increasingly turn to digital procurement to mitigate supply chain risks and reduce operational costs.

Infosys has consistently invested in local partnerships, client engagement centres, and specialised joint ventures to cater to Japan’s distinct business culture and operational models. The addition of Mitsubishi Heavy Industries to the HIPUS ecosystem not only adds strategic heft but also aligns with Infosys’ localisation efforts in Japan, including bilingual service delivery, cultural integration, and tailored analytics frameworks suited to Japanese corporations.

Why Is Digital Procurement Becoming A Strategic Priority In Japan?

Digital procurement is fast becoming a board-level agenda item for Japanese enterprises, driven by macroeconomic shifts, geopolitical supply chain disruptions, and a demographic push for automation due to labour shortages. Companies like Mitsubishi Heavy Industries are increasingly relying on AI-powered procurement tools to enhance transparency, manage third-party risks, improve spend visibility, and optimise supplier selection.

HIPUS provides a platform that blends these capabilities with deep sourcing expertise and end-to-end category management. With Infosys’ engineering and consulting resources complementing HIPUS’ local delivery model, Japanese clients gain access to a global supply chain innovation engine.

What Does Market Sentiment Say About Infosys Following This Expansion?

As of April 17, 2025, Infosys Limited (NSE: INFY) closed at ₹1,428.10, registering a 1.07% gain for the day. However, the stock has declined by nearly 25% year-to-date, reflecting broader investor caution amid a sector-wide slowdown in global IT spending. The recent announcement of Mitsubishi Heavy Industries’ investment in HIPUS has provided a modest sentiment boost, reinforcing Infosys’ stronghold in Japan and its focus on industry-specific digital transformation.

Foreign Institutional Investors (FIIs) have trimmed their holdings slightly—from 33.3% to 32.89%—while Domestic Institutional Investors (DIIs) have increased their stake from 38.4% to 38.5%. Notably, mutual funds raised their shareholding from 20.05% to 20.45%, indicating growing domestic confidence in the company’s strategic direction.

Analysts tracking Infosys maintain a positive stance. The 12-month average price target stands near $20.00 per share, suggesting a potential 24% upside. With a current P/E ratio of 21.23, Infosys remains below the sector average of 25.55, making its valuation relatively attractive. Brokerage firms continue to issue “Buy” or “Hold” ratings, citing strong large-deal wins, high free cash flow, and long-term visibility through digital-led partnerships like HIPUS.

For long-term investors, the company’s continued push into value-added services, especially in procurement, AI, and ERP transformation, supports a Buy or Hold stance. Those seeking short-term returns might remain cautious amid muted FY26 revenue guidance of 0%-3%.