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Tokushu Tokai Paper Co., Ltd. (JP:3708)
:3708
Japanese Market
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Tokushu Tokai Paper Co., Ltd. (3708) AI Stock Analysis

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JP:3708

Tokushu Tokai Paper Co., Ltd.

(3708)

Rating:72Outperform
Price Target:
¥4,009.00
▼(-4.89% Downside)
Tokushu Tokai Paper Co., Ltd. scores 71.5, reflecting strong financial performance with growth in revenue and operational efficiency. Valuation is favorable with a reasonable P/E ratio and good dividend yield. However, technical indicators suggest neutral market sentiment and challenges in cash flow management need addressing.

Tokushu Tokai Paper Co., Ltd. (3708) vs. iShares MSCI Japan ETF (EWJ)

Tokushu Tokai Paper Co., Ltd. Business Overview & Revenue Model

Company DescriptionTokushu Tokai Paper Co., Ltd. manufactures, processes, and sells paper products in Japan. It offers special material products, such as fancy, high-grade printer, canvas, functional, security, and information-use papers, as well as papers for protection and preservation. The company also provides industrial material products comprising containerboards, kraft papers, and converting papers. In addition, it offers household products, including paper towels, paper for food material, paper wipers, gifts, toilet papers, and laminated products. Further, the company is involved in manufacturing and sale of paper pulps, special functional papers, protective papers, and other papers used in electronics industry; purchase and sale of paper stocks, etc.; transportation and work in rail yard services; collection, processing, transport, and sale/purchase of waste materials; production of whisky; and warehousing, leasing, transportation, and selling of liquor products. Additionally, it engages in the civil engineering, building, landscape gardening, forestry, sightseeing, and other businesses. Tokushu Tokai Paper Co., Ltd. was incorporated in 2007 and is headquartered in Tokyo, Japan.
How the Company Makes MoneyTokushu Tokai Paper Co., Ltd. generates revenue primarily through the sale of its paper products. The company's key revenue streams include sales of specialty paper, which is used in high-value applications due to its unique properties, and packaging materials that serve the growing demand in e-commerce and consumer goods industries. Additionally, the company benefits from sales of functional materials, which may include advanced paper products with specific functionalities for industrial use. Significant partnerships with distributors and manufacturers, as well as the company's ability to innovate and adapt to market demands, contribute to its earnings.

Tokushu Tokai Paper Co., Ltd. Financial Statement Overview

Summary
Tokushu Tokai Paper Co., Ltd. exhibits strong revenue growth and operational efficiency, supported by a robust balance sheet with moderate leverage. However, challenges include declining net profit margins and negative free cash flow, which require attention for improved profitability and cash flow management.
Income Statement
78
Positive
Tokushu Tokai Paper Co., Ltd. has shown consistent revenue growth over the past years, with a notable increase in total revenue from 86.5 billion yen in 2024 to 94.8 billion yen in 2025. The gross profit margin improved to 12.95% in 2025 from 11.98% in 2024, indicating better cost management. However, the net profit margin decreased from 5.30% in 2024 to 3.80% in 2025, suggesting challenges in maintaining profitability. The EBIT and EBITDA margins showed improvement, reflecting a stronger operational performance.
Balance Sheet
82
Very Positive
The company's balance sheet is robust, with a debt-to-equity ratio of 0.37, indicating a moderate level of leverage. The equity ratio is strong at 56.43%, showcasing a solid equity base. Although there is a slight increase in total debt, the return on equity (ROE) stands at 4.58%, reflecting a steady return for shareholders. The company's asset base and equity have grown, highlighting financial stability.
Cash Flow
65
Positive
The cash flow situation presents a mixed picture. Operating cash flow has decreased from 11.4 billion yen in 2024 to 8.77 billion yen in 2025, while free cash flow turned negative this year, indicating challenges in cash generation. The free cash flow to net income ratio is negative, highlighting the need for better cash flow management. Despite these issues, the operating cash flow to net income ratio remains healthy, suggesting that the company's operations are still generating cash.
BreakdownMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue94.80B86.52B84.13B80.71B76.40B
Gross Profit12.28B10.37B8.80B11.76B11.09B
EBITDA12.35B12.52B7.81B10.60B9.91B
Net Income3.61B4.59B4.13B5.25B5.59B
Balance Sheet
Total Assets139.44B132.98B123.35B125.43B128.09B
Cash, Cash Equivalents and Short-Term Investments11.38B13.43B10.30B12.06B13.53B
Total Debt29.17B26.91B24.41B24.79B24.82B
Total Liabilities53.60B49.05B44.77B46.87B47.81B
Stockholders Equity78.68B77.01B72.23B72.29B73.60B
Cash Flow
Free Cash Flow-1.13B5.01B-2.18B2.19B3.17B
Operating Cash Flow8.77B11.40B2.58B9.58B11.64B
Investing Cash Flow-9.37B-6.10B-1.15B-4.70B893.00M
Financing Cash Flow-1.50B-2.58B-3.18B-6.42B-9.24B

Tokushu Tokai Paper Co., Ltd. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price4215.00
Price Trends
50DMA
3944.80
Positive
100DMA
3781.85
Positive
200DMA
3667.55
Positive
Market Momentum
MACD
78.42
Positive
RSI
69.47
Neutral
STOCH
80.39
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3708, the sentiment is Positive. The current price of 4215 is above the 20-day moving average (MA) of 4111.50, above the 50-day MA of 3944.80, and above the 200-day MA of 3667.55, indicating a bullish trend. The MACD of 78.42 indicates Positive momentum. The RSI at 69.47 is Neutral, neither overbought nor oversold. The STOCH value of 80.39 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3708.

Tokushu Tokai Paper Co., Ltd. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
72
Outperform
¥48.15B13.75
2.86%8.71%-24.08%
61
Neutral
$10.31B6.180.76%2.94%3.30%-36.34%
€183.79M9.273.75%
€1.01B10.596.24%
78
Outperform
¥51.33B7.03
3.59%3.21%-16.62%
77
Outperform
¥103.04B14.65
3.57%5.74%-42.24%
75
Outperform
¥23.27B19.52
4.07%3.05%-63.52%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:3708
Tokushu Tokai Paper Co., Ltd.
4,215.00
612.30
17.00%
DE:MPX
Mitsubishi Paper Mills
4.02
0.58
16.86%
DE:HPE
Hokuetsu Corporation
5.95
-3.45
-36.70%
JP:3877
Chuetsu Pulp & Paper Co., Ltd.
1,718.00
428.07
33.19%
JP:8032
Japan Pulp and Paper Co. Ltd.
700.00
90.60
14.87%
JP:9274
KPP GROUP HOLDINGS CO.,LTD.
807.00
158.89
24.52%

Tokushu Tokai Paper Co., Ltd. Corporate Events

Tokushu Tokai Paper Finalizes Stock Option Issuance Details
Aug 8, 2025

Tokushu Tokai Paper Co., Ltd. has finalized the details for issuing stock options, a decision made by the Board of Directors on July 17, 2025. The issuance involves 74 share acquisition rights, primarily allocated to company directors and executive officers, with a total value of 26,869,400 yen. This move is aimed at aligning the interests of the company’s leadership with its performance, potentially impacting the company’s operational strategies and stakeholder value.

Tokushu Tokai Paper Announces Share Split and Dividend Revision
Aug 8, 2025

Tokushu Tokai Paper Co., Ltd. announced a share split and amendments to its Articles of Incorporation to increase share liquidity and expand its investor base. The company also revised its year-end dividend forecast, reflecting an increase, and is reviewing its Shareholder Benefit Program, signaling potential positive impacts for stakeholders.

Tokushu Tokai Paper Reports Increased Sales and Announces Stock Split
Aug 8, 2025

Tokushu Tokai Paper Co., Ltd. reported a 7% increase in net sales for the three months ending June 30, 2025, compared to the same period last year. Despite a slight decrease in profit attributable to owners, the company announced a stock split and an increase in the forecasted year-end dividend, indicating a strategic move to enhance shareholder value.

Tokushu Tokai Paper Co., Ltd. Acquires Functional Paper Assets from TOMOEGAWA
Jul 25, 2025

Tokushu Tokai Paper Co., Ltd. has entered into a basic agreement to acquire business goodwill and inventories of functional papers from TOMOEGAWA CORPORATION. This strategic move is part of Tokushu Tokai’s efforts to stabilize its revenue base and promote growth in the paper and environment-related sectors by expanding its product mix into growth areas. The acquisition is expected to enhance Tokushu Tokai’s operational capabilities and market positioning, potentially benefiting stakeholders through improved business performance and market reach.

Tokushu Tokai Paper Co., Ltd. Issues Stock Options to Align Management and Shareholder Interests
Jul 17, 2025

Tokushu Tokai Paper Co., Ltd. has announced the issuance of stock options as a form of stock compensation for its directors and executive officers. This initiative aims to align the interests of management with shareholders by linking compensation to the company’s performance and share value, thereby motivating management to enhance corporate value over the medium to long term.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: May 31, 2025