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Sakai Chemical Industry Co., Ltd. (JP:4078)
:4078
Japanese Market
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Sakai Chemical Industry Co., Ltd. (4078) AI Stock Analysis

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JP:4078

Sakai Chemical Industry Co., Ltd.

(4078)

Rating:71Outperform
Price Target:
¥2,821.00
▲(1.95%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. (4078) vs. iShares MSCI Japan ETF (EWJ)

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

Company DescriptionSakai Chemical Industry Co., Ltd. (4078) is a Japanese company that specializes in the development, manufacturing, and distribution of chemical products. The company's operations are primarily focused on the production of functional chemicals, electronic materials, and environmental materials. Sakai Chemical is dedicated to innovation in the chemical industry, providing high-quality products that cater to various industrial applications, including pharmaceuticals, cosmetics, electronics, and environmental solutions.
How the Company Makes MoneySakai Chemical Industry Co., Ltd. generates revenue through the sale of its diverse range of chemical products that serve multiple industries. The company earns money by manufacturing and supplying functional chemicals used in pharmaceuticals and cosmetics, which are critical to these sectors. Additionally, the company produces electronic materials that are essential for the electronics industry, including products used in semiconductors and display technologies. Environmental materials are another significant revenue stream, as the company offers solutions that address environmental issues and sustainability needs. The company's earnings are supported by its strong research and development capabilities, which enable it to innovate and create high-demand products, as well as strategic partnerships with other industrial players that enhance market reach and product distribution.

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
72
Positive
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
65
Positive
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
78
Positive
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.
BreakdownMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue84.41B82.11B83.86B80.14B84.92B
Gross Profit20.28B16.86B18.48B21.05B17.22B
EBITDA9.76B892.00M9.61B13.76B2.43B
Net Income5.01B-7.09B2.34B6.75B-2.80B
Balance Sheet
Total Assets123.32B125.44B128.02B123.92B123.01B
Cash, Cash Equivalents and Short-Term Investments16.18B16.59B12.41B10.80B11.09B
Total Debt21.92B27.04B21.64B16.96B20.44B
Total Liabilities43.93B49.98B43.31B41.21B43.74B
Stockholders Equity78.29B74.39B80.49B78.85B75.80B
Cash Flow
Free Cash Flow5.06B2.84B-1.89B1.50B-1.74B
Operating Cash Flow12.01B6.87B773.00M6.57B7.83B
Investing Cash Flow-5.71B-3.96B-2.62B-1.65B-7.42B
Financing Cash Flow-6.88B1.26B3.28B-5.65B1.67B

Sakai Chemical Industry Co., Ltd. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price2767.00
Price Trends
50DMA
2641.02
Positive
100DMA
2610.28
Positive
200DMA
2579.47
Positive
Market Momentum
MACD
28.92
Positive
RSI
65.52
Neutral
STOCH
63.53
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 2767 is above the 20-day moving average (MA) of 2707.40, above the 50-day MA of 2641.02, and above the 200-day MA of 2579.47, indicating a bullish trend. The MACD of 28.92 indicates Positive momentum. The RSI at 65.52 is Neutral, neither overbought nor oversold. The STOCH value of 63.53 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

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
¥252.31B23.47
0.98%1.99%35.53%
74
Outperform
¥87.66B9.90
3.87%4.87%5.07%
71
Outperform
¥46.64B8.86
4.88%3.16%
70
Outperform
¥50.50B15.39
1.82%-3.73%
69
Neutral
¥62.63B9.90
4.41%3.21%-2.40%
63
Neutral
€8.72B9.2534.42%7.28%-1.58%56.22%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:4078
Sakai Chemical Industry Co., Ltd.
2,767.00
160.69
6.17%
JP:4008
Sumitomo Seika Chemicals Co., Ltd.
4,535.00
-401.95
-8.14%
JP:4028
ISHIHARA SANGYO KAISHA, LTD.
2,194.00
720.27
48.87%
JP:4046
OSAKA SODA CO.,LTD.
1,937.00
18.69
0.97%
JP:4047
Kanto Denka Kogyo Co., Ltd.
879.00
-5.86
-0.66%

Sakai Chemical Industry Co., Ltd. Corporate Events

Sakai Chemical Industry Announces Disposal of Treasury Shares for Director Compensation
Jul 23, 2025

Sakai Chemical Industry Co., Ltd. has announced the disposal of 7,767 treasury shares as restricted stock compensation to align the interests of its directors with shareholders and enhance corporate value. This initiative, part of a plan introduced in 2018, aims to motivate directors by tying their compensation to stock performance, with specific restrictions and conditions outlined for the allocation and transfer of shares.

Sakai Chemical Completes Share Buyback of 500,000 Shares
Jul 1, 2025

Sakai Chemical Industry Co., Ltd. announced the completion of acquiring 500,000 of its own shares at a total cost of 1,322,000,000 yen, as part of a resolution made by its Board of Directors. This acquisition, conducted through market purchases, is part of a broader strategy to manage the company’s capital structure, potentially impacting shareholder value and market perception.

Sakai Chemical Industry Executes Share Repurchase Strategy
Jun 20, 2025

Sakai Chemical Industry Co., Ltd. has successfully repurchased 500,000 of its own shares through the Tokyo Stock Exchange’s off-auction trading system, amounting to a total acquisition cost of 1,322,000,000 yen. This move is part of a broader strategy approved by the Board of Directors to acquire up to 1,000,000 shares by November 2025, with plans to cancel all acquired treasury shares, potentially impacting the company’s share value and market positioning.

Sakai Chemical Industry Announces Share Repurchase Plan
Jun 19, 2025

Sakai Chemical Industry Co., Ltd. has announced a plan to repurchase up to 1,000,000 of its own shares, representing 6.17% of the total issued shares, as part of a strategic move to enhance shareholder value. The repurchase will be conducted through the Tokyo Stock Exchange’s off-auction trading system and market purchases, with the company planning to cancel all acquired treasury shares to optimize its capital structure.

Sakai Chemical Industry Reports Zero Share Acquisition
Jun 2, 2025

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
May 14, 2025

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
May 14, 2025

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
May 14, 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.

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 29, 2025