Kumiai Chemical Industry Co., Ltd. (4996) AI Stock Analysis

• Market Cap: ¥97.20B
• Dividend Yield: 3.41%
• Average Volume (3M): 671.09K
• Price to Earnings (P/E): 5.4
• Beta (1Y): 0.47
• Revenue Growth: 5.84%
• EPS Growth: -67.78%
• Country: JP
• Employees: 2,134
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Agricultural Inputs
• EPS (TTM): 32.75
• Shares Outstanding: 133,184,600
• 10 Day Avg. Volume: 1,051,730
• 30 Day Avg. Volume: 671,093
• PEG Ratio: -0.28
• Price to Book (P/B): 0.57
• Price to Sales (P/S): 0.48
• P/FCF Ratio: 3.22
• 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): 61.54
• Revenue Forecast (FY): ¥164.55B

• Rating: 65 Neutral
• Price Target: ¥845.00 ▲(19.01% Upside)
• Action: Reiterated Date: 03/14/26
• Date: Action: Reiterated 03/14/26

The score is driven primarily by moderate financial performance (steady growth and operational efficiency, offset by margin pressure, declining ROE, rising debt, and uneven free cash flow). Technicals show an uptrend but are overbought, and valuation is fair with a supportive dividend yield.

Positive Factors

Consistent revenue growth

Kumiai's recurring revenue expansion demonstrates sustained demand for its crop protection portfolio. Steady top-line growth supports multi-period R&D investment, predictable cash inflows, and gradual market-share gains across domestic and export channels, underpinning durable business planning.

Solid EBIT/EBITDA margins

Consistently healthy operating margins indicate efficient manufacturing and cost control in agrochemical production. Margin resilience provides buffer against input cost swings, preserves internal funding for product lifecycle work, and supports competitive pricing and reinvestment over the medium term.

Strong operating cash generation

Reliable operating cash flow conversion versus earnings enhances financial flexibility. It enables reinvestment in R&D, supports working-capital cycles tied to seasonality, and reduces dependence on external financing for capex or product launches over the next several quarters.

Negative Factors

Rising total debt and falling ROE

An expanding debt load alongside declining ROE points to diminishing capital efficiency. Higher leverage raises interest and refinancing risks, reducing strategic optionality for M&A or R&D spending and pressuring returns to shareholders if profitability doesn't recover.

Declining gross and net margins

Eroding gross and net margins suggest cost pressures or pricing competition in key product lines. Sustained margin compression would weaken ability to fund innovation and absorb input shocks, reducing long-term profitability and competitive reinvestment capacity.

Volatile free cash flow

Unstable free cash flow complicates capital allocation, making dividends, capex, and R&D timing less predictable. In adverse seasons or investment cycles this volatility could force additional borrowing, exacerbating leverage and constraining strategic initiatives.

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

Company Description

Kumiai Chemical Industry Co., Ltd. manufactures and sells agrochemicals. Its agricultural chemicals comprise herbicides, fungicides, acaricide, microbial pesticide, and PGR; and fine chemicals include chlorotoluenes, chlorobenzyl chlorides, chlorobenzotrichlorides, chlorobenzaldehydes, chlorobenzoyl chlorides, chlorobenzoic acids, phenoxyphenols, and phosphines. The company also offers curing agents. It markets its products in Japan, as well as in approximately 50 countries. The company was formerly known as Ihara Agrochemical Co., Ltd. and changed its name to Kumiai Chemical Industry Co., Ltd. in 1968. Kumiai Chemical Industry Co., Ltd. was founded in 1928 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Kumiai Chemical Industry makes money mainly by selling crop protection products and related agrochemical solutions. Its core revenue stream comes from commercialization of proprietary and/or licensed active ingredients and formulated products (e.g., herbicides, insecticides, fungicides), sold into agricultural distribution channels in Japan and internationally. Earnings are driven by (1) sales volume and pricing of key products across crop types and geographies, (2) the product mix between higher-value proprietary products versus commodity or partnered products, and (3) ongoing R&D that generates new products and life-cycle extensions that can support premium pricing and market share. International revenue is generated through exports and overseas sales networks and/or local partners depending on market, while domestic revenue is supported by Japan’s agricultural supply chain. Specific details on the exact segment breakdown, named flagship products, and disclosed major partnerships are null.

Kumiai Chemical Industry Co., Ltd. Financial Statement Overview

Summary

Moderately strong fundamentals: steady revenue growth and solid EBIT/EBITDA margins, but weakening gross and net margins, declining ROE, rising debt levels, and volatile free cash flow temper the outlook.

Income Statement

Kumiai Chemical Industry Co., Ltd. has shown consistent revenue growth over the years, with a 2.48% increase in the latest period. However, the gross profit margin has slightly decreased, indicating potential cost pressures. The net profit margin has also declined, suggesting reduced profitability. Despite these challenges, the company maintains a solid EBIT and EBITDA margin, reflecting operational efficiency.

Balance Sheet

The company's balance sheet reflects a stable financial position with a manageable debt-to-equity ratio. However, the increase in total debt over the years is a concern. Return on equity has decreased, indicating a decline in profitability relative to shareholder equity. The equity ratio remains healthy, suggesting a strong capital structure.

Cash Flow

Cash flow analysis reveals a positive operating cash flow, but free cash flow has been volatile, with recent improvements. The operating cash flow to net income ratio is strong, indicating efficient cash generation relative to profits. However, the free cash flow to net income ratio has fluctuated, highlighting potential cash flow management challenges.

Breakdown	Oct 2025	Oct 2024	Oct 2023	Oct 2022	Oct 2021
Income Statement
Total Revenue	170.46B	161.05B	161.00B	145.30B	118.18B
Gross Profit	36.95B	38.13B	41.34B	37.93B	32.53B
EBITDA	17.08B	17.28B	19.10B	17.55B	12.74B
Net Income	4.38B	13.59B	18.02B	16.33B	9.02B
Balance Sheet
Total Assets	248.21B	275.47B	226.94B	204.60B	169.17B
Cash, Cash Equivalents and Short-Term Investments	21.98B	27.40B	27.08B	22.30B	20.05B
Total Debt	51.90B	75.10B	46.40B	35.44B	22.90B
Total Liabilities	97.10B	122.53B	87.09B	82.61B	59.22B
Stockholders Equity	144.49B	145.92B	133.03B	115.47B	103.89B
Cash Flow
Free Cash Flow	25.53B	-25.74B	-3.93B	-8.98B	-2.15B
Operating Cash Flow	33.80B	-16.73B	4.76B	-1.16B	4.48B
Investing Cash Flow	-8.93B	-8.76B	-10.10B	-7.82B	-5.31B
Financing Cash Flow	-27.85B	23.61B	6.86B	5.62B	439.00M

Kumiai Chemical Industry Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 710.00
• 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:4996, the sentiment is Positive. The current price of 710 is below the 20-day moving average (MA) of 735.90, below the 50-day MA of 716.48, and below the 200-day MA of 747.63, indicating a bullish trend. The MACD of 20.44 indicates Negative momentum. The RSI at 62.32 is Neutral, neither overbought nor oversold. The STOCH value of 69.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4996.

Kumiai Chemical Industry Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4992	82 Outperform	¥43.09B	9.57	―	2.86%	4.66%	19.39%
4979	78 Outperform	¥30.00B	9.37	―	3.82%	8.02%	42.17%
1376	69 Neutral	¥16.90B	66.09	―	2.41%	4.00%	32.05%
4997	69 Neutral	¥79.28B	32.13	―	2.35%	6.95%	8.85%
4996	65 Neutral	¥97.20B	5.37	―	3.41%	5.84%	-67.78%
4031	64 Neutral	¥10.07B	-510.60	―	2.30%	4.02%	-42.44%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%

Kumiai Chemical Industry Co., Ltd. Corporate Events

Kumiai Chemical Completes Restricted Stock Treasury Share Disposal for Executive Remuneration

Kumiai Chemical Industry Co., Ltd. has completed payment procedures for the disposal of 50,500 treasury shares used as restricted stock remuneration, following a board resolution made on February 20, 2026. The move, involving a total disposal amount of 36.36 million yen at 720 yen per share, allocates shares to six internal directors and eight executive officers, strengthening equity-based incentives and further aligning management’s interests with those of shareholders.

By finalizing this restricted stock grant on March 19, 2026, Kumiai Chemical Industry signals continued use of stock-based compensation as part of its governance and remuneration framework. The allocation of shares exclusively to internal directors and non-director executive officers underscores a focus on long-term commitment and performance, which may influence management stability and strategic execution over time.

The most recent analyst rating on (JP:4996) stock is a Hold with a Yen860.00 price target. To see the full list of analyst forecasts on Kumiai Chemical Industry Co., Ltd. stock, see the JP:4996 Stock Forecast page.

Kumiai Chemical Delivers Strong Q1 Sales and Operating Profit on Agrochemical Demand

Kumiai Chemical Industry Co., Ltd., a producer of agricultural and fine chemicals, reported solid momentum in both core segments, supported by stronger sales of crop protection products such as AXEEV and increased demand for fine chemical offerings. The business remains exposed to currency trends, with the yen averaging 156 per U.S. dollar in the first quarter, slightly weaker year-on-year.

For the first quarter of the fiscal year ending October 2026, net sales rose 8% to ¥46.7 billion and operating profit jumped 25% to ¥5.0 billion, driven by higher volumes and an improved product mix. Ordinary profit climbed 23% to ¥6.2 billion, though profit attributable to owners of the parent dipped 2% to ¥3.9 billion, suggesting margin and below-the-line factors may temper the immediate benefit to shareholders despite robust top-line and operating performance.

The most recent analyst rating on (JP:4996) stock is a Hold with a Yen745.00 price target. To see the full list of analyst forecasts on Kumiai Chemical Industry Co., Ltd. stock, see the JP:4996 Stock Forecast page.

Kumiai Chemical Posts Higher Q1 Sales but Signals Profit Pressure for FY 2026

Kumiai Chemical Industry Co., Ltd. reported consolidated net sales of ¥46.7 billion for the three months ended January 31, 2026, up 7.7% year on year, with operating profit rising 24.5% and ordinary profit up 23.4%, while profit attributable to owners of parent edged down 1.5% and basic earnings per share slipped to ¥32.75. The company’s equity-to-asset ratio remained solid at 56.6% despite an increase in total assets, it maintained its annual dividend forecast of ¥24 per share for the fiscal year ending October 31, 2026, and it projected full‑year net sales to decline 5.0% with a sharp drop in operating profit, even as profit attributable to owners of parent is expected to rebound 46.1%, signaling cautious top-line expectations but improving bottom-line efficiency.

For the first half of the fiscal year ending April 30, 2026, Kumiai forecasts net sales of ¥92.8 billion, down 3.5%, and a 35.4% decrease in operating profit, reflecting anticipated cost or demand pressures in the near term. Over the full year, however, the company expects ordinary profit to fall 18.4% even as net income improves, suggesting a focus on profitability and capital discipline that could support shareholder returns through a stable dividend policy despite a softer revenue outlook.

The most recent analyst rating on (JP:4996) stock is a Hold with a Yen745.00 price target. To see the full list of analyst forecasts on Kumiai Chemical Industry Co., Ltd. stock, see the JP:4996 Stock Forecast page.

Kumiai Chemical to Grant Restricted Treasury Shares to Directors and Executives

Kumiai Chemical Industry will dispose of 50,500 treasury shares on March 19, 2026, at 720 yen per share, allocating them as restricted stock remuneration to six directors and eight executive officers. The transaction totals 36.36 million yen and forms part of an existing stock-based compensation plan designed to deepen alignment between management and shareholders.

The restricted stock plan, first introduced in 2020 for directors and extended in 2021 to executive officers, caps annual issuance at 150,000 shares and sets pricing based on recent market prices to avoid preferential treatment. With a 30-year transfer restriction and the possibility of forfeiture under certain conditions, the scheme is structured to provide long-term incentives and reinforce the company’s governance and performance-focused remuneration framework.

The most recent analyst rating on (JP:4996) stock is a Hold with a Yen745.00 price target. To see the full list of analyst forecasts on Kumiai Chemical Industry Co., Ltd. stock, see the JP:4996 Stock Forecast page.

Kumiai Chemical Affirms Independence Despite Major Shareholder Ties to Farm Co-op Federation

Kumiai Chemical Industry has disclosed the status of its relationship with its largest shareholder, the National Federation of Agricultural Cooperative Associations, which holds 22.1% of its voting rights and is classified as an other affiliated company rather than a controlling parent. The company emphasizes that this shareholder does not constrain its business activities or management decision-making, underscoring its independence as a listed entity, even though a senior executive from the federation serves as a part‑time Audit & Supervisory Board Member to leverage his agribusiness expertise. The disclosure also details substantial commercial transactions between the two parties—primarily the sale of Kumiai’s products and purchase of raw materials—conducted on arm’s‑length terms via annual price negotiations, signaling to investors and other stakeholders that governance and transaction conditions are aligned with general market practices despite the close business and capital ties.

The most recent analyst rating on (JP:4996) stock is a Hold with a Yen745.00 price target. To see the full list of analyst forecasts on Kumiai Chemical Industry Co., Ltd. stock, see the JP:4996 Stock Forecast page.