Sakai Chemical Industry Co., Ltd. (4078) AI Stock Analysis

• Market Cap: ¥44.89B
• Dividend Yield: 5.15%
• Average Volume (3M): 73.97K
• Price to Earnings (P/E): 8.6
• Beta (1Y): 0.90
• Revenue Growth: 3.16%
• EPS Growth: N/A
• Country: JP
• Employees: 1,999
• Sector: Basic Materials
• Sector Strength: 68
• Industry: Chemicals - Specialty
• EPS (TTM): 79.39
• Shares Outstanding: 17,000,000
• 10 Day Avg. Volume: 69,530
• 30 Day Avg. Volume: 73,970
• PEG Ratio: -0.19
• Price to Book (P/B): 0.36
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -15.20
• 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

• Rating: 71 Outperform
• Price Target: ¥2,821.00 ▲(5.93%Upside)

Sakai Chemical Industry Co., Ltd. achieves a strong overall score driven by robust financial performance and an attractive valuation profile. The company's effective cash flow management and profitability improvements are significant strengths. Technical indicators present a mixed picture, with signs of bullish momentum but some caution due to oversold conditions.

Sakai Chemical Industry Co., Ltd. Business Overview & Revenue Model

Company Description

Sakai Chemical Industry Co., Ltd. (4078) is a Japanese company primarily engaged in the manufacture and sale of chemical products. The company operates in various sectors, including electronics, pharmaceuticals, and industrial chemicals. Its core products include pigments, stabilizers, and other chemical additives that are used in a wide range of applications such as plastics, coatings, and electronics.

How the Company Makes Money

Sakai Chemical Industry Co., Ltd. generates revenue through the production and sale of its chemical products. The company sells its products to various industries, including electronics, automotive, and pharmaceuticals, which require specialized chemical materials for manufacturing and product development. Key revenue streams for Sakai include the sales of pigments and stabilizers used in plastics and coatings, as well as advanced materials for electronic components. Partnerships with major manufacturers in these sectors also contribute to the company's earnings by providing a steady demand for its products. Additionally, Sakai may engage in research and development activities to innovate and expand its product offerings, thereby creating new revenue opportunities.

Sakai Chemical Industry Co., Ltd. Financial Statement Overview

Summary

Sakai Chemical Industry Co., Ltd. exhibits a solid financial performance with improved profitability and strong cash flow generation. The balance sheet is robust with low leverage, though there may be opportunities to optimize capital structure for enhanced growth.

Income Statement

Sakai Chemical Industry Co., Ltd. shows a strong recovery in profitability with a net income of 5,014 million yen and a gross profit margin of 24.02%. The revenue growth rate is modest at 2.8%, indicating stable sales. The EBIT margin has significantly improved from the previous year, rising to 7.22%, while the EBITDA margin stands at 11.56%. Despite the positive trends, the volatility in net income observed in prior years poses a potential risk.

Balance Sheet

The company's financial leverage is moderate with a debt-to-equity ratio of 0.28, which is a positive indicator of financial health. Return on Equity has improved significantly to 6.4%, reflecting better profitability for shareholders. However, the equity ratio remains relatively high at 63.5%, suggesting a conservative capital structure but potentially underutilized leverage in growth initiatives.

Cash Flow

The cash flow situation is robust, with a substantial increase in free cash flow to 5,057 million yen, representing a growth rate of 77.9%. The operating cash flow to net income ratio is strong at 2.39, indicating efficient cash generation from operations. While free cash flow to net income ratio at 1.01 suggests effective conversion of profits into cash, the company has significantly improved its cash flow management.

Breakdown
TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
84.92B	84.41B	82.11B	83.86B	80.14B	84.92B
	Gross Profit
19.91B	20.28B	16.86B	18.48B	21.05B	17.22B
	EBIT
5.92B	6.09B	2.94B	4.41B	7.49B	4.30B
	EBITDA
9.57B	9.76B	892.00M	9.61B	13.76B	2.43B
	Net Income Common Stockholders
4.10B	5.01B	-7.09B	2.34B	6.75B	-2.80B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
15.07B	16.18B	16.59B	12.41B	10.80B	11.09B
	Total Assets
125.24B	123.32B	125.44B	128.02B	123.92B	123.01B
	Total Debt
23.80B	21.92B	27.04B	21.64B	16.96B	20.44B
	Net Debt
8.73B	5.74B	10.45B	9.23B	6.16B	9.35B
	Total Liabilities
47.44B	43.93B	49.98B	43.31B	41.21B	43.74B
	Stockholders Equity
76.84B	78.29B	74.39B	80.49B	78.85B	75.80B
Cash Flow		Free Cash Flow
0.00	5.06B	2.84B	-1.89B	1.50B	-1.74B
	Operating Cash Flow
0.00	12.01B	6.87B	773.00M	6.57B	7.83B
	Investing Cash Flow
0.00	-5.71B	-3.96B	-2.62B	-1.65B	-7.42B
	Financing Cash Flow
0.00	-6.88B	1.26B	3.28B	-5.65B	1.67B

Sakai Chemical Industry Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2663.00
• 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:4078, the sentiment is Positive. The current price of 2663 is above the 20-day moving average (MA) of 2590.75, above the 50-day MA of 2525.90, and above the 200-day MA of 2553.97, indicating a bullish trend. The MACD of 28.98 indicates Negative momentum. The RSI at 57.06 is Neutral, neither overbought nor oversold. The STOCH value of 67.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4078.

Sakai Chemical Industry Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4046	79 Outperform	¥216.88B	20.42		1.13%	4.85%	35.53%
4028	75 Outperform	¥74.08B	8.43		4.58%	4.87%	5.12%
4078	71 Outperform	¥44.89B	8.61		5.15%	3.16%	―
4008	66 Neutral	¥60.54B	9.73		4.56%	3.21%	-1.94%
4047	66 Neutral	¥48.14B	14.82		2.02%	-3.73%	―
Sector *	51 Neutral	$2.04B	-1.15	-21.24%	3.95%	2.91%	-30.44%

Sakai Chemical Industry Co., Ltd. Corporate Events

Sakai Chemical Industry Reports Zero Share Acquisition

Sakai Chemical Industry Co., Ltd. announced that it has not acquired any of its own shares during the specified acquisition period from May 15, 2025, to May 31, 2025, despite having resolved to purchase up to 1,000,000 shares. The acquisition plan, which was approved by the Board of Directors, aimed to enhance shareholder value but has yet to be executed, leaving the total number of shares acquired at zero.

Sakai Chemical Industry Announces Share Buyback to Boost Shareholder Value

Sakai Chemical Industry Co., Ltd. has announced a decision by its Board of Directors to acquire up to 1,000,000 of its own shares, representing 6.17% of its total issued shares, excluding treasury shares. This move, which will take place between May 15, 2025, and November 30, 2025, aims to improve shareholder value per share and capital efficiency. The acquisition will be conducted through market purchases on the Tokyo Stock Exchange and the Off-Auction Own Share Repurchase Trading System. Following the acquisition, the company plans to cancel all the treasury shares acquired, further optimizing its capital structure.

Sakai Chemical Industry Proposes Amendments to Articles of Incorporation

Sakai Chemical Industry Co., Ltd. has announced a proposal to amend its Articles of Incorporation by reducing the maximum number of directors from 15 to 11. This change aims to enhance management agility and strengthen corporate governance by aligning the number of directors with the current operational needs, following improvements in their executive officer system introduced in 2021.

Sakai Chemical Reports Strong Financial Recovery in FY 2025

Sakai Chemical Industry Co., Ltd. reported a significant improvement in its financial performance for the fiscal year ending March 2025, with a 2.8% increase in net sales and a dramatic rise in operating profit by 107.1%. The company’s comprehensive income also turned positive, reflecting a strong recovery from the previous year’s losses, indicating a positive impact on its operations and market positioning.