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Nippon Soda Co., Ltd. (JP:4041)
:4041
Japanese Market
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Nippon Soda Co., Ltd. (4041) AI Stock Analysis

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JP:4041

Nippon Soda Co., Ltd.

(4041)

Rating:78Outperform
Price Target:
¥3,710.00
▲(10.09%Upside)
Nippon Soda Co., Ltd. is performing well financially, with strong profitability, low leverage, and improving cash flow. The stock is technically strong with positive momentum but is currently overbought. Valuation metrics are attractive with a low P/E ratio and high dividend yield, suggesting a good investment opportunity, albeit with some caution due to overbought technical signals.

Nippon Soda Co., Ltd. (4041) vs. iShares MSCI Japan ETF (EWJ)

Nippon Soda Co., Ltd. Business Overview & Revenue Model

Company DescriptionNippon Soda Co., Ltd. develops, produces, processes, imports, markets, sells, and exports chemicals, agrochemicals, and other products in Japan and internationally. The company offers agrochemicals, including fungicides, insecticides, acaricides, and herbicides. It also provides specialty chemicals organic, such as titanate; magnesium ethylate, o-tolidine diisocyanate, adhesive agents for film lamination, photoresist base resins, developers for thermal paper, epoxy catalyst, permethyl polysilane, crown ethers, photocatalysts, bactericides, algaecides, fungicides for wood, insecticides, and termiticide, as well as liquid-1, 2-polybutadiene. In addition, the company offers pharmaceutical excipients, including diaminomaleonitrile, sodium stearyl fumarate, and hydroxypropyl cellulose; and eco business and consumer chemicals, such as inorganic chlorine tablets and granules, toilet-use uroliths removers, and chelating agents for heavy metal, as well as treatment systems by for PCBs. Further, it provides chlor-alkali chemicals comprising caustic soda, hydrochloric acid, liquid chlorine, potassium cyanide, sodium hypochlorite, sodium metal, sodium alcoholates, sodium cyanide, phosphorus oxychloride, and phosphorus trichloride. Additionally, the company offers functional products, synthetic resins and other plastic materials, dyes, industrial devices, and construction products; pharmaceuticals; synthetic resin molded products; smoking, deoxygenating, and dehumidifying agents; industrial chemicals; household goods; agricultural materials and other products; and feed additives. It also engages in warehousing, packaging, customs brokerage, and insurance agency business, as well as leasing activities; freight forwarding, truck transportation; plant construction and civil engineering activities; mining of soil and rocks; and manufacture and sale of non-ferrous metals and concrete products. Nippon Soda Co., Ltd. was incorporated in 1920 and is headquartered in Tokyo, Japan.
How the Company Makes MoneyNippon Soda Co., Ltd. generates revenue primarily through the sale of its chemical products across its major business segments, which include agrochemicals, specialty chemicals, industrial chemicals, and pharmaceuticals. The company benefits from a strong market presence in the agrochemical sector, where it supplies pesticides, fungicides, and herbicides to support agricultural productivity. Additionally, Nippon Soda develops and sells specialty chemicals tailored for specific industrial applications, contributing to its revenue streams. The pharmaceutical segment also plays a role in the company's earnings, with the production and distribution of active pharmaceutical ingredients and intermediates. Key partnerships and a robust supply chain further enhance the company's ability to reach global markets effectively, thus contributing to its financial performance.

Nippon Soda Co., Ltd. Financial Statement Overview

Summary
Nippon Soda Co., Ltd. demonstrates strong financial health with solid profitability and effective equity utilization. The company maintains a low debt-to-equity ratio and a strong equity base. Cash flow improvements are evident with positive free cash flow, but free cash generation relative to net earnings is limited.
Income Statement
78
Positive
Nippon Soda Co., Ltd. has shown consistent revenue growth with a slight increase in total revenue from 2024 to 2025. The gross profit margin is strong at 28.9%, and the net profit margin is healthy at 9.7%. Despite a decrease in net income compared to the previous year, the EBIT and EBITDA margins remain robust at 10.4% and 18.4%, respectively, indicating good operational efficiency.
Balance Sheet
82
Very Positive
The company maintains a solid financial position with a debt-to-equity ratio of 0.27, indicating low leverage. The equity ratio stands at 64.8%, reflecting a strong equity base compared to its assets. Return on equity is commendable at 8.0%, showcasing effective use of equity for generating profits.
Cash Flow
70
Positive
Nippon Soda Co., Ltd. has experienced a significant improvement in free cash flow from negative in 2024 to positive in 2025, indicating better cash management. The operating cash flow to net income ratio is 1.51, suggesting efficient conversion of income into cash. However, the free cash flow to net income ratio is relatively low at 0.24, indicating limited free cash generation relative to net earnings.
BreakdownMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue155.20B154.43B172.81B152.54B139.36B
Gross Profit44.91B42.70B49.28B42.11B38.77B
EBITDA28.55B29.49B26.00B20.54B17.67B
Net Income15.01B16.61B16.69B12.68B7.36B
Balance Sheet
Total Assets288.10B290.49B251.35B245.59B227.97B
Cash, Cash Equivalents and Short-Term Investments22.27B22.21B18.51B17.94B19.29B
Total Debt50.24B48.91B32.34B38.99B37.71B
Total Liabilities99.99B101.02B80.39B87.29B78.77B
Stockholders Equity186.78B188.05B169.25B155.94B145.77B
Cash Flow
Free Cash Flow3.58B-5.69B3.00B2.56B813.00M
Operating Cash Flow22.64B5.73B15.59B14.54B13.82B
Investing Cash Flow-17.56B-9.59B-4.86B-11.62B-13.77B
Financing Cash Flow-5.39B6.69B-10.44B-4.80B1.72B

Nippon Soda Co., Ltd. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price3370.00
Price Trends
50DMA
3049.64
Positive
100DMA
2902.19
Positive
200DMA
2774.06
Positive
Market Momentum
MACD
107.43
Negative
RSI
85.41
Negative
STOCH
87.31
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4041, the sentiment is Positive. The current price of 3370 is above the 20-day moving average (MA) of 3240.50, above the 50-day MA of 3049.64, and above the 200-day MA of 2774.06, indicating a bullish trend. The MACD of 107.43 indicates Negative momentum. The RSI at 85.41 is Negative, neither overbought nor oversold. The STOCH value of 87.31 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4041.

Nippon Soda Co., Ltd. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (44)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
¥189.29B12.44
2.34%0.50%-8.77%
77
Outperform
¥264.87B15.00
6.33%4.42%61.92%
74
Outperform
€216.26B12.696.49%4.34%10.30%333.75%
74
Outperform
¥164.63B14.845.27%4.23%5.13%-8.77%
54
Neutral
¥183.03B15.29-4.17%4.71%2.82%-202.98%
44
Neutral
€13.37B7.54-1.83%0.86%-23.94%-110.06%
44
Neutral
AU$1.51B-6.22-41.37%3.85%-3.52%-43.04%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:4041
Nippon Soda Co., Ltd.
3,420.00
906.02
36.04%
JP:4114
Nippon Shokubai Co., Ltd.
1,705.50
209.49
14.00%
JP:4272
Nippon Kayaku Co
1,383.50
195.52
16.46%
JP:4061
Denka Co
2,110.00
51.78
2.52%
JP:4045
Toagosei Co
1,468.50
21.91
1.51%
JP:4080
Tanaka Chemical Corp.
406.00
-554.00
-57.71%

Nippon Soda Co., Ltd. Corporate Events

Nippon Soda Adjusts Treasury Share Disposal Plan
Jul 4, 2025

Nippon Soda Co., Ltd. announced corrections to its previously published notice regarding the disposal of treasury shares as restricted share remuneration. The corrections involve an increase in the number of shares to be disposed of and the total disposal amount, reflecting adjustments in the company’s financial strategy. This move is aimed at aligning with the company’s performance and strategic goals, potentially impacting its financial operations and stakeholder interests.

Nippon Soda Implements Restricted Share Remuneration System
Jul 3, 2025

Nippon Soda Co., Ltd. has announced a resolution to dispose of 10,676 treasury shares as part of a restricted share remuneration system. This move aims to align the interests of directors and executive officers with shareholders by promoting long-term corporate value enhancement. The disposal involves a total amount of 33,576,020 yen and is part of a broader strategy to replace the performance-based share remuneration system, reflecting the company’s focus on sustainable growth and stakeholder alignment.

Nippon Soda Co., Ltd. Advances Treasury Share Acquisition Plan
Jul 1, 2025

Nippon Soda Co., Ltd. has announced the acquisition of 169,800 treasury shares at a cost of 501,223,700 yen as part of a broader plan to acquire up to 2,500,000 shares by January 31, 2026. This strategic move is aimed at optimizing capital structure and potentially enhancing shareholder value, reflecting the company’s proactive approach in managing its financial resources.

Nippon Soda Advances Treasury Share Acquisition Plan
Jun 2, 2025

Nippon Soda Co., Ltd. announced the acquisition of 131,700 treasury shares at a cost of 376,458,700 yen, as part of a broader plan to acquire up to 2.5 million shares by January 2026. This move is part of the company’s strategy to manage its capital structure and potentially enhance shareholder value.

Nippon Soda Proposes Dividend from Retained Earnings
May 21, 2025

Nippon Soda Co., Ltd. has announced a proposal to pay a dividend from its retained earnings, which will be discussed at the upcoming shareholders’ meeting. The company has introduced a progressive dividend policy, setting a target return ratio of 50% or more, and has decided on a year-end dividend of 80 yen per share for the fiscal year ended March 2025, reflecting its commitment to stable dividends and shareholder returns.

Nippon Soda Revises KPIs and Introduces New Capital Policy
May 14, 2025

Nippon Soda Co., Ltd. has revised its key performance indicators for its long-term vision ‘Brilliance through Chemistry 2030’ and introduced a new capital policy to improve capital efficiency. The company plans to increase its year-end dividend by 20 yen per share and acquire up to 2.5 million treasury shares, reflecting its response to changes in the business environment and commitment to shareholder returns.

Nippon Soda Announces Treasury Share Acquisition Plan
May 14, 2025

Nippon Soda Co., Ltd. has announced a plan to acquire up to 2,500,000 of its own common shares, representing 4.53% of the total issued shares, as part of a strategy to enhance shareholder returns and improve capital efficiency. The acquisition, with a maximum cost of 5 billion yen, will be conducted through market purchases on the Tokyo Stock Exchange from May 15, 2025, to January 31, 2026, reflecting a commitment to a new capital policy.

Nippon Soda Co., Ltd. Increases Year-End Dividend Amid Steady Performance
May 14, 2025

Nippon Soda Co., Ltd. announced a revision of its dividend forecast for the fiscal year ended March 31, 2025, increasing the year-end dividend by 20 yen per share to 80 yen. This decision aligns with the company’s new shareholder return policy, which includes a progressive dividend policy and a target total return ratio of 50% or more, reflecting steady business performance.

Nippon Soda Reports Mixed Financial Results for FY 2025
May 14, 2025

Nippon Soda Co., Ltd. reported its consolidated financial results for the fiscal year ending March 31, 2025, showing a slight increase in net sales by 0.5% to ¥155,199 million. However, the company experienced a decline in ordinary profit by 16.2% and profit attributable to owners by 9.6%. The company also announced a 2-for-1 share split effective October 1, 2024, impacting its dividend payments and share calculations. Despite the challenges, the company maintains a strong equity-to-asset ratio of 64.8%, indicating a stable financial position.

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: Jul 10, 2025