Harima Chemicals Group, Inc. (4410) AI Stock Analysis

• Market Cap: ¥25.34B
• Dividend Yield: 4.62%
• Average Volume (3M): 54.44K
• Price to Earnings (P/E): 13.3
• Beta (1Y): 0.66
• Revenue Growth: 7.19%
• EPS Growth: N/A
• Country: JP
• Employees: 1,734
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 39.94
• Shares Outstanding: 26,080,397
• 10 Day Avg. Volume: 48,570
• 30 Day Avg. Volume: 54,443
• PEG Ratio: -0.16
• Price to Book (P/B): 0.55
• Price to Sales (P/S): 0.20
• P/FCF Ratio: 30.14
• 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): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: ¥1,087.00 ▲(17.26% Upside)
• Action: Reiterated Date: 10/23/25
• Date: Action: Reiterated 10/23/25

The overall stock score reflects a strong financial performance with significant improvements in profitability and cash flow. Technical analysis indicates a neutral trend with some bullish momentum, while valuation suggests the stock is relatively expensive but offers a good dividend yield. The absence of earnings call data and corporate events limits additional insights.

Positive Factors

Cash generation

Material improvement in operating cash flow and positive free cash flow indicate durable cash conversion from operations. This strengthens liquidity for capex, dividends or debt paydown, enhances financial flexibility versus cyclical end markets, and underpins longer-term investment capacity.

Margin and revenue recovery

Simultaneous revenue growth and margin expansion reflect improved product mix and cost control, suggesting structural operational improvements. Sustained 21% gross margin and rising EBIT/EBITDA margins support durable profitability if the company maintains value-added rosin derivatives and pricing discipline.

Equity-backed balance sheet

A healthy equity ratio and substantial equity base reduce solvency risk and provide headroom for strategic investments or cyclical downturns. This structural capital buffer improves creditor confidence and underpins long-term operational continuity and access to financing when needed.

Negative Factors

Rising leverage

An elevated and rising debt-to-equity ratio increases fixed obligations and reduces financial flexibility. Over a multi-month horizon higher leverage can constrain reinvestment, raise refinancing risk if rates climb, and amplify earnings volatility if margins or demand weaken.

Low return on equity

A ROE near 2% signals limited effectiveness in converting equity into profits. Persistently low ROE may indicate capital allocation inefficiencies or low-margin business mix, reducing the company's ability to fund growth internally or deliver attractive long-term returns to shareholders.

Fragile profitability

While profitability returned, the net margin is very thin, leaving earnings highly sensitive to raw material cost swings or demand dips. Without sustained margin expansion or diversification, the company's profits remain vulnerable and recovery could be reversed by modest adverse shocks.

Harima Chemicals Group, Inc. Business Overview & Revenue Model

Company Description

Harima Chemicals Group, Inc. primarily manufactures and sells various chemicals and electronic materials in Japan, China, rest of Asia, South and North America, Europe, and internationally. It operates through Resin & Tall Oil Products, Paper Chemicals, Electronics Materials, and Lawter segments. The company's Resin & Tall Oil Products segment offers resin and tail oil products, including printing ink resins that are used to display information and colors in newspapers, magazines, flyers, and posters; paint resins to protect various objects from rust and deterioration, and enhance the appearance of man-made objects, such as automobiles, industrial products, buildings, and everyday items; adhesive resins; and synthetic rubber emulsifiers, which are used in automobile tires. Its Paper Chemicals segment provides paper chemicals comprising sizing agents for preventing water-based inks from bleeding; paper strengthening agents for structural fortification; coating agents that are used for enhancing and reinforcing paper surfaces; and pitch control agents. The company's Electronics Materials segment offers electronic materials, which include solder pastes and conductive pastes that are used to mount microchips and form electronic circuits; and aluminum brazing materials for use in the manufacture of aluminum products. Its Lawter segment manufactures and sells adhesive resin and printing ink resins. The company also manufactures and sells industrial detergents, etc.; and provides real estate management services. The company was formerly known as Harima Chemicals, Inc. and changed its name to Harima Chemicals Group, Inc. in October 2012. Harima Chemicals Group, Inc. was incorporated in 1947 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Harima Chemicals Group generates revenue primarily through the sale of its chemical products, which include high-performance polymers, resins, coatings, and specialty chemicals. The company benefits from multiple key revenue streams, including direct sales to manufacturers in various sectors such as automotive and electronics, as well as partnerships with other chemical companies and industries that require advanced materials. Additionally, Harima Chemicals engages in research and development activities to create innovative solutions, which can lead to premium pricing for its advanced products. The company's ability to adapt to market demands and invest in sustainable practices also plays a crucial role in maintaining its profitability and expanding its market share.

Harima Chemicals Group, Inc. Financial Statement Overview

Summary

Harima Chemicals Group, Inc. shows a solid turnaround, with marked improvements in profitability and cash flow generation while maintaining a stable equity position. The company's revenue growth and improved margins highlight effective operational strategies. Despite the increased leverage, financial stability remains intact, supported by a healthy equity base and robust cash flow generation.

Income Statement

The company has shown a strong recovery in its income statement performance. Gross profit margin improved from previous years, with a gross profit margin of 21.05% in the latest year. Net profit margin turned positive at 0.76%, signaling a return to profitability after a year of losses. Revenue growth was notable at 9.37% compared to the previous year, indicating strong market demand. The EBIT margin improved significantly to 2.06% from a negative position, and the EBITDA margin rose to 5.58%. These improvements suggest effective cost management and increased operational efficiency.

Balance Sheet

The balance sheet reflects a strong equity base with a debt-to-equity ratio of 1.14, which is manageable but has increased over the years, indicating a rise in leverage. The return on equity (ROE) is modest at 2.04%, reflecting a cautious yet steady return for shareholders. The equity ratio remains healthy at 37.32%, pointing to a stable financial structure with substantial equity backing the company's assets. However, the increase in total debt warrants careful monitoring.

Cash Flow

Cash flow dynamics show improvement, with operating cash flow significantly rebounding to 6,145 million yen. Free cash flow also turned positive, reflecting better capital expenditure management. The operating cash flow to net income ratio is robust at 8.05, suggesting strong cash generation relative to net earnings. The free cash flow to net income ratio is 0.90, indicating that most earnings are being converted into free cash flow, which is a positive sign for liquidity and investment potential. Despite these improvements, the company should continue to focus on sustaining cash flow growth.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	102.92B	101.01B	92.33B	94.51B	76.09B	62.85B
Gross Profit	22.40B	21.26B	17.92B	19.21B	17.98B	14.96B
EBITDA	6.10B	5.63B	3.06B	5.22B	5.44B	4.93B
Net Income	791.00M	763.00M	-1.16B	885.73M	1.75B	1.09B
Balance Sheet
Total Assets	101.00B	100.04B	98.58B	92.44B	78.91B	69.39B
Cash, Cash Equivalents and Short-Term Investments	4.93B	4.75B	6.85B	6.30B	6.63B	3.48B
Total Debt	42.03B	42.56B	39.37B	33.67B	21.50B	17.68B
Total Liabilities	64.06B	62.03B	57.70B	51.62B	38.80B	31.95B
Stockholders Equity	36.27B	37.33B	37.22B	37.10B	36.74B	34.57B
Cash Flow
Free Cash Flow	0.00	684.00M	-3.08B	-4.80B	-22.99M	712.74M
Operating Cash Flow	0.00	6.14B	353.00M	-466.24M	2.83B	3.01B
Investing Cash Flow	0.00	-4.98B	-3.20B	-6.65B	-3.44B	-1.86B
Financing Cash Flow	0.00	-3.67B	2.90B	7.66B	2.11B	-1.56B

Harima Chemicals Group, Inc. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 927.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4410, the sentiment is Neutral. The current price of 927 is below the 20-day moving average (MA) of 1022.05, below the 50-day MA of 969.72, and above the 200-day MA of 869.88, indicating a neutral trend. The MACD of 19.11 indicates Positive momentum. The RSI at 50.44 is Neutral, neither overbought nor oversold. The STOCH value of 46.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:4410.

Harima Chemicals Group, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4229	80 Outperform	¥38.78B	17.48	―	2.47%	3.53%	8.36%
4973	77 Outperform	¥28.41B	17.43	―	3.63%	18.02%	18.04%
4064	76 Outperform	¥28.43B	10.86	―	3.21%	9.61%	173.72%
4092	72 Outperform	¥30.67B	14.88	―	3.84%	-3.41%	-12.83%
4410	66 Neutral	¥25.34B	13.28	―	4.62%	7.19%	―
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
4968	61 Neutral	¥28.95B	16.95	―	4.27%	5.72%	28.92%

Harima Chemicals Group, Inc. Corporate Events

Harima Chemicals to Sell SunPine Stake, Reinvest Proceeds in Growth and Debt Reduction

Harima Chemicals Group has agreed to sell its shareholding in Swedish company SunPine AB, currently held indirectly through its subsidiary Lawter Europe BV, to existing shareholder Preem, also of Sweden. Harima originally invested in SunPine in 2012 to secure stable European supplies of tall oil rosin, but a prolonged decline in rosin demand has eased supply-demand pressures, and long-term purchase contracts with SunPine mean the divestment is not expected to disrupt its raw material procurement.

The company expects no impact on its consolidated financial results for fiscal 2025, while the effect on fiscal 2026 earnings remains under review and will be disclosed if material. Proceeds from the transaction will be directed toward capital investments in growth areas and debt reduction, signaling a strategic reallocation of assets to strengthen Harima’s balance sheet and support future expansion despite weakness in the rosin market.

The most recent analyst rating on (JP:4410) stock is a Hold with a Yen1043.00 price target. To see the full list of analyst forecasts on Harima Chemicals Group, Inc. stock, see the JP:4410 Stock Forecast page.

Harima Chemicals to Divest SunPine Stake in Strategic Capital Shift

Harima Chemicals Group has decided to sell its entire 24.6% stake in Swedish joint venture SunPine AB, held via Lawter Europe BV, to existing shareholder VAROPreem AB, Sweden’s largest fuel refining and sales company, and is now negotiating final contract terms. The divestment is aimed at improving capital efficiency by monetizing policy‑held shares and reallocating capital to growth areas, while Harima expects no disruption to its tall oil rosin procurement or to FY2025 results, reflecting a response to easing rosin demand and a shift in portfolio strategy.

SunPine has supplied Harima with tall oil rosin under long‑term contracts, and these arrangements are expected to remain in place despite the ownership change, underscoring that the move is a financial and strategic rebalancing rather than an operational retreat. The decision follows Preem’s exercise of its preferential right to acquire the shares on terms equivalent to an external investor’s offer, consolidating SunPine’s ownership among Swedish partners as Harima reviews the potential impact on FY2026 earnings and refocuses capital on higher‑growth segments.

The most recent analyst rating on (JP:4410) stock is a Hold with a Yen1056.00 price target. To see the full list of analyst forecasts on Harima Chemicals Group, Inc. stock, see the JP:4410 Stock Forecast page.

Harima Chemicals Lifts FY2025 Profit Forecast on Strong Resins and Semiconductor Materials

Harima Chemicals Group has revised its fiscal 2025 consolidated earnings forecast, leaving net sales unchanged at ¥108 billion but substantially raising profit projections, with operating income expected to rise to ¥3.3 billion, ordinary income to ¥2.8 billion, and net income attributable to the parent to ¥1.85 billion. The company cited stronger-than-expected performance in its Resins and Tall Oil Products business driven by new paint resin products, as well as robust demand in its Electronic Materials division for resins used in semiconductor resists, offsetting weaker sales in Paper Chemicals in Japan and China and lower-than-anticipated volumes in the Lawter business due to a sluggish recovery in Europe and the U.S.; as a result, profitability is now forecast to grow significantly year on year, signaling improved earnings efficiency despite flat overall sales.

The most recent analyst rating on (JP:4410) stock is a Hold with a Yen1008.00 price target. To see the full list of analyst forecasts on Harima Chemicals Group, Inc. stock, see the JP:4410 Stock Forecast page.

Harima Chemicals Group Lifts Full-Year Profit Outlook on Strong Q3 Earnings

Harima Chemicals Group reported steady topline growth and sharply improved profitability for the third quarter of the fiscal year ending March 31, 2026, with net sales up 2.9% year on year to ¥77.9 billion and net income attributable to the parent more than doubling, rising 149.2% to ¥1.8 billion. Operating income climbed 36.8% to ¥2.7 billion and ordinary income rose 63.5%, while total assets increased to ¥103.3 billion and equity also improved, indicating a stronger balance sheet. The company maintained its interim dividend at ¥21 per share and kept the full-year dividend forecast at ¥42, and it upgraded its full-year earnings outlook, now projecting net sales of ¥108 billion and a 142.5% jump in full-year net income to ¥1.85 billion, signaling improved operational efficiency and a more optimistic earnings trajectory for shareholders despite only modest sales growth. The consolidation scope, accounting policies, and capital structure remained largely unchanged, underscoring that the performance improvement is driven primarily by core operations rather than structural changes.

The most recent analyst rating on (JP:4410) stock is a Hold with a Yen1008.00 price target. To see the full list of analyst forecasts on Harima Chemicals Group, Inc. stock, see the JP:4410 Stock Forecast page.

Harima Chemicals Announces Senior Personnel Changes

Harima Chemicals Group, Inc. announced changes in its senior personnel, effective January 1, 2026, following a Board of Directors’ meeting. These changes include new appointments for key positions within the company, which may influence its strategic direction and operational efficiency, particularly in its paper chemicals division.

The most recent analyst rating on (JP:4410) stock is a Hold with a Yen951.00 price target. To see the full list of analyst forecasts on Harima Chemicals Group, Inc. stock, see the JP:4410 Stock Forecast page.