Nippon Kayaku Co (4272) AI Stock Analysis

• Market Cap: ¥210.74B
• Dividend Yield: 5.61%
• Average Volume (3M): 473.14K
• Price to Earnings (P/E): 12.5
• Beta (1Y): 0.41
• Revenue Growth: 10.30%
• EPS Growth: 333.75%
• Country: JP
• Employees: 5,902
• Sector: Industrials
• Sector Strength: 89
• Industry: Chemicals
• EPS (TTM): 26.15
• Shares Outstanding: 160,000,000
• 10 Day Avg. Volume: 457,360
• 30 Day Avg. Volume: 473,143
• PEG Ratio: 0.59
• Price to Book (P/B): 0.80
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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: ¥1,436.94
• Price Target Upside: 7.56% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 74 Outperform
• Price Target: ¥1,450.00 ▲(8.53%Upside)

Nippon Kayaku Co's strong financial performance, particularly its revenue growth and profitability improvements, is the most significant factor driving the score. The company's valuation is favorable with a low P/E ratio and high dividend yield, adding to its attractiveness. However, the neutral technical indicators suggest no strong momentum currently, which slightly tempers the overall score.

Nippon Kayaku Co Business Overview & Revenue Model

Company Description

Nippon Kayaku Co., Ltd. is a diversified chemical company based in Japan, engaged in the development, manufacture, and sale of a wide range of chemical products. The company operates through several sectors, including functional chemicals, pharmaceuticals, safety systems, and agrochemicals. Its core products and services include dyes, functional materials, pharmaceuticals, inflators for automotive airbags, and agrochemicals, catering to both domestic and international markets.

How the Company Makes Money

Nippon Kayaku Co., Ltd. generates revenue through a diverse range of business segments. In the functional chemicals sector, the company earns income by producing and selling dyes, intermediates, and other chemical products used in textiles, plastics, and electronics. The pharmaceutical segment contributes to revenue by developing and distributing generic medications and cancer treatment drugs. The safety systems division is a significant revenue stream, where the company manufactures and supplies inflators for automotive airbags, serving major automotive manufacturers. Additionally, the agrochemical division generates income by producing pesticides and herbicides for agricultural use. Strategic partnerships and collaborations with global companies also play a role in expanding its market presence and driving sales growth.

Nippon Kayaku Co Financial Statement Overview

Summary

Nippon Kayaku Co exhibits strong financial performance with consistent revenue growth and improved profitability margins. The balance sheet reflects financial stability with a strong equity base and manageable debt levels. However, the negative free cash flow in 2025 highlights potential challenges in cash management and capital expenditure optimization.

Income Statement

Nippon Kayaku Co has shown consistent revenue growth, with a 10.3% increase in revenue from 2024 to 2025. The gross profit margin for 2025 is robust at 32.1%, and the net profit margin improved significantly from 2.0% in 2024 to 7.9% in 2025. The EBIT margin is strong at 9.2%, demonstrating effective cost management. However, the EBITDA margin decreased slightly from 10.8% in 2024 to 16.3% in 2025, indicating slight pressure on operational efficiency.

Balance Sheet

The company maintains a strong equity position with an equity ratio of 71.6% in 2025, indicating financial stability. The debt-to-equity ratio is moderate at 0.16, showcasing prudent leverage management. The return on equity improved to 6.5% in 2025 from 1.5% in 2024, indicating enhanced shareholder value creation. Despite these strengths, the decrease in stockholders' equity from 2024 to 2025 warrants attention.

Cash Flow

Nippon Kayaku Co's operating cash flow to net income ratio is healthy at 1.46 in 2025, reflecting strong cash generation relative to earnings. However, the free cash flow turned negative in 2025, raising concerns about capital expenditure management. The free cash flow to net income ratio is also negative at -0.21, suggesting challenges in converting profits into free cash flows.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	222.58B	201.79B	198.38B	184.81B	173.38B
Gross Profit	71.48B	61.30B	66.75B	63.97B	56.32B
EBITDA	36.31B	21.73B	35.32B	37.88B	31.10B
Net Income	17.51B	4.11B	14.98B	17.18B	12.57B
Balance Sheet
Total Assets	373.71B	363.17B	322.86B	315.46B	294.54B
Cash, Cash Equivalents and Short-Term Investments	59.76B	66.18B	54.35B	53.65B	48.12B
Total Debt	42.10B	31.45B	19.58B	16.65B	19.40B
Total Liabilities	105.19B	92.63B	67.83B	69.03B	66.26B
Stockholders Equity	267.53B	269.56B	254.02B	245.48B	227.50B
Cash Flow
Free Cash Flow	-3.73B	7.41B	7.05B	13.67B	10.88B
Operating Cash Flow	25.53B	23.24B	20.04B	23.14B	24.41B
Investing Cash Flow	-27.31B	-19.41B	-15.16B	-10.64B	-17.61B
Financing Cash Flow	-4.76B	3.82B	-7.95B	-11.09B	-8.40B

Nippon Kayaku Co Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1336.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4272, the sentiment is Positive. The current price of 1336 is above the 20-day moving average (MA) of 1306.90, above the 50-day MA of 1303.52, and above the 200-day MA of 1278.67, indicating a bullish trend. The MACD of 9.08 indicates Negative momentum. The RSI at 68.27 is Neutral, neither overbought nor oversold. The STOCH value of 94.50 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4272.

Nippon Kayaku Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4368	79 Outperform	¥140.97B	12.13		1.90%	17.86%	39.28%
4041	78 Outperform	¥185.94B	12.22		4.80%	0.50%	-8.77%
4272	74 Outperform	¥210.74B	12.47	6.49%	5.61%	10.30%	333.75%
4114	74 Outperform	¥258.74B	14.65		6.47%	4.42%	61.92%
4045	74 Outperform	¥160.29B	14.54	5.27%	4.52%	5.13%	-8.77%
Sector *	70 Neutral	¥171.40B	10.74	4.42%	3.06%	5.63%	-31.54%
4061	54 Neutral	€179.06B	15.29	-4.17%	4.82%	2.82%	-202.98%

Nippon Kayaku Co Corporate Events

Nippon Kayaku Announces Change in Major Shareholder

Nippon Kayaku Co., Ltd. announced a change in its major shareholder, Silchester International Investors LLP, which has reduced its voting rights from 10.99% to 9.97%. This change was reported to the Kanto Local Finance Bureau, but the company has not provided any specific outlook or implications for this shift in shareholder structure.

Nippon Kayaku Announces Disposal of Treasury Shares for Stock Compensation

Nippon Kayaku Co., Ltd. announced the disposal of 84,307 treasury shares as part of a restricted stock compensation plan for its board members and directors. This move aims to incentivize the company’s leadership to enhance corporate value and align their interests with those of shareholders. The plan, approved in 2021, allows for up to 100,000 shares to be issued annually, with specific conditions on transfer restrictions and potential recovery of shares if conditions are not met.

Nippon Kayaku Reports Strong Financial Performance for FY2025

Nippon Kayaku Co., Ltd. reported a significant increase in its consolidated financial results for the fiscal year ended March 31, 2025, with net sales rising by 10.3% and profit attributable to owners of the parent surging by 325.6%. The company also announced an increase in dividends per share, reflecting its strong financial performance. Despite a decrease in comprehensive income, the company maintained a solid financial position with a high equity ratio. These results indicate a robust recovery and growth trajectory for Nippon Kayaku, potentially strengthening its market position and benefiting stakeholders.

Nippon Kayaku Announces Strategic Share Cancellation

Nippon Kayaku Co., Ltd. announced its decision to cancel 5,003,570 common shares, representing 3.03% of its total shares, as part of a strategic move to prevent future share dilution. This cancellation, scheduled for May 23, 2025, is expected to strengthen shareholder value and reflect the company’s proactive approach in managing its capital structure.

Nippon Kayaku Reports Strong Financial Growth for FY 2025

Nippon Kayaku Co., Ltd. reported a significant improvement in its financial performance for the fiscal year ended March 31, 2025, with a 10.3% increase in net sales and a substantial rise in operating income by 178.1%. The company also saw a notable increase in profit attributable to owners of the parent by 325.6%, indicating strong operational efficiency and market demand. The dividend per share increased to 60 yen, reflecting the company’s robust financial health and commitment to returning value to shareholders.