Nippon Kodoshi Corporation (3891) AI Stock Analysis

• Market Cap: ¥45.55B
• Dividend Yield: 2.28%
• Average Volume (3M): 33.57K
• Price to Earnings (P/E): 11.8
• Beta (1Y): 0.91
• Revenue Growth: 12.56%
• EPS Growth: 18.52%
• Country: JP
• Employees: 485
• Sector: Technology
• Sector Strength: 88
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 72.46
• Shares Outstanding: 10,698,482
• 10 Day Avg. Volume: 30,540
• 30 Day Avg. Volume: 33,566
• PEG Ratio: 0.50
• Price to Book (P/B): 0.77
• Price to Sales (P/S): 1.15
• P/FCF Ratio: -8.63
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 227.6
• Revenue Forecast (FY): ¥18.50B

• Rating: 72 Outperform
• Price Target: ¥4,690.00 ▲(36.93% Upside)
• Action: Reiterated Date: 01/15/26
• Date: Action: Reiterated 01/15/26

The score is driven primarily by solid financial performance (strong profitability and a stable balance sheet), supported by a clear uptrend in the price. Offsetting factors are negative recent free cash flow due to elevated capex and only moderate valuation with a P/E around 20.

Positive Factors

Stable, strong margins

A steady ~28% gross margin and rising net margin to 11.1% indicate durable operating economics and pricing power in core products. Sustained margins support reinvestment and cash generation, making profitability less sensitive to short-term revenue swings and relevant over months.

Robust balance sheet and low leverage

A high 67.8% equity ratio and overall low leverage provide financial flexibility to fund strategic investments, absorb shocks, and avoid costly refinancing. This durable strength reduces insolvency risk and preserves options for acquisitions or capex over the medium term.

Improving operating cash flow

Rising operating cash flow shows the business is converting profit into cash more effectively, strengthening liquidity and internal funding capacity. This trend underpins sustainable operations and supports capital allocation decisions over the coming quarters.

Negative Factors

Negative free cash flow from high capex

Persistent negative free cash flow driven by elevated capex can pressure liquidity and force external financing if sustained. Even if capex is strategic, prolonged negative FCF raises execution and financing risk and could constrain returns or dividend capacity over months.

Fluctuating revenue growth

Variable top-line growth suggests demand or execution cyclicality rather than consistent expansion. Fluctuations increase forecasting uncertainty and may reflect sensitivity to market cycles or project timing, making revenue sustainability less predictable over the medium term.

Limited organizational scale

A modest headcount (~485 employees) implies constrained operational scale versus larger peers, potentially limiting production, R&D throughput, and global distribution expansion. Scale limits can slow market share gains and raise per-unit costs over a multi-quarter horizon.

Nippon Kodoshi Corporation Business Overview & Revenue Model

Company Description

Nippon Kodoshi Corporation manufactures and sells separators in Japan and internationally. The company offers aluminum electrolytic capacitors for electronic devices and home appliances; separators for conductive polymer solid capacitors that are used for digital home appliances, such as PC and flat TV; and separators for electric double layer capacitors that are used for OA equipment, industrial machines, eco-car, and clean energy. It also provides battery separators for alkaline battery and lithium ion battery. Nippon Kodoshi Corporation was incorporated in 1941 and is headquartered in Kochi, Japan.

How the Company Makes Money

Nippon Kodoshi Corporation generates revenue through the sales of its specialized resin materials and components to various industries, including electronics and automotive. The company’s primary revenue streams include the production of high-performance epoxy resins, which are essential for manufacturing printed circuit boards and other electronic components. Additionally, partnerships with leading technology firms and automotive manufacturers enhance its market reach and stability. The company also benefits from research and development investments, enabling it to offer cutting-edge materials that command premium pricing in competitive markets. Overall, Nippon Kodoshi's focus on quality and innovation allows it to maintain strong customer relationships and drive consistent revenue growth.

Nippon Kodoshi Corporation Financial Statement Overview

Summary

Overall financials are solid: income statement strength (75) is supported by steady ~28% gross margin and improving net margin (to 11.1% in 2025), while the balance sheet is notably strong (80) with a high 67.8% equity ratio and low leverage. The main offset is cash flow (65): operating cash flow is improving, but recent negative free cash flow driven by high capex warrants monitoring.

Income Statement

Nippon Kodoshi Corporation demonstrates strong profitability with a consistent gross profit margin of around 28% over the last three years. The net profit margin shows a positive trend, increasing from 9.9% in 2020 to 11.1% in 2025. Revenue growth is steady but has fluctuated, with a notable growth of 8.1% from 2024 to 2025. EBIT and EBITDA margins indicate effective cost management and operational efficiency.

Balance Sheet

The company maintains a solid balance sheet, highlighted by a decreasing debt-to-equity ratio from 0.21 in 2020 to 0.35 in 2025, reflecting prudent financial leverage. Return on equity has improved significantly to 7.4% in 2025, indicating enhanced profitability for shareholders. The equity ratio stands strong at 67.8% in 2025, suggesting financial stability and low reliance on external debt.

Cash Flow

Operating cash flow has improved substantially from 2020 to 2025, up from ¥2.4 billion to ¥3.8 billion, demonstrating strong cash generation capability. However, free cash flow has been negative in recent years due to high capital expenditures, which could pose liquidity challenges if not managed carefully. The operating cash flow to net income ratio is healthy, indicating efficient conversion of profit into cash.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	16.78B	16.03B	14.83B	17.59B	18.07B	15.92B
Gross Profit	4.58B	4.45B	3.65B	5.53B	6.15B	4.60B
EBITDA	3.58B	3.51B	3.46B	4.95B	5.55B	4.07B
Net Income	1.72B	1.78B	1.48B	2.47B	2.92B	2.01B
Balance Sheet
Total Assets	35.57B	35.27B	33.98B	30.63B	26.16B	25.03B
Cash, Cash Equivalents and Short-Term Investments	4.33B	4.13B	4.31B	4.22B	4.44B	4.58B
Total Debt	9.08B	8.29B	8.19B	5.75B	2.85B	3.82B
Total Liabilities	11.48B	11.37B	11.61B	9.06B	6.83B	8.42B
Stockholders Equity	24.08B	23.90B	22.37B	21.57B	19.33B	16.60B
Cash Flow
Free Cash Flow	0.00	-2.14B	-1.50B	-2.88B	1.02B	2.32B
Operating Cash Flow	0.00	3.80B	1.91B	685.31M	2.91B	3.22B
Investing Cash Flow	0.00	-3.40B	-3.41B	-3.60B	-1.84B	-988.77M
Financing Cash Flow	0.00	-637.32M	1.50B	2.58B	-1.26B	541.32M

Nippon Kodoshi Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3425.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3891, the sentiment is Positive. The current price of 3425 is below the 20-day moving average (MA) of 3875.25, below the 50-day MA of 3608.60, and above the 200-day MA of 2540.86, indicating a bullish trend. The MACD of 207.98 indicates Negative momentum. The RSI at 62.63 is Neutral, neither overbought nor oversold. The STOCH value of 48.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3891.

Nippon Kodoshi Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3891	72 Outperform	¥45.55B	11.82	―	2.28%	12.56%	18.52%
6817	70 Outperform	¥38.64B	10.06	―	4.53%	-2.57%	3.43%
6768	69 Neutral	¥59.47B	33.92	3.63%	2.25%	11.74%	-30.96%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
6996	60 Neutral	¥133.12B	11.45	―	2.18%	-0.93%	-45.03%
6844	58 Neutral	¥37.57B	2.72	―	1.95%	6.10%	―
6997	47 Neutral	¥41.63B	9.09	0.39%	―	-2.53%	-85.61%