Nippon Chutetsukan K.K. (5612) AI Stock Analysis

• Market Cap: ¥5.25B
• Dividend Yield: 1.57%
• Average Volume (3M): 20.91K
• Price to Earnings (P/E): 10.9
• Beta (1Y): 1.09
• Revenue Growth: -0.86%
• EPS Growth: -162.79%
• Country: JP
• Employees: 392
• Sector: Industrials
• Sector Strength: 72
• Industry: Construction
• EPS (TTM): 38.72
• Shares Outstanding: 3,293,074
• 10 Day Avg. Volume: 24,260
• 30 Day Avg. Volume: 20,910
• PEG Ratio: 0.13
• Price to Book (P/B): 0.48
• Price to Sales (P/S): 0.26
• P/FCF Ratio: -4.62
• 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: 46 Neutral
• Price Target: ¥1,602.00 ▼(-12.60% Downside)
• Action: Reiterated Date: 03/24/26
• Date: Action: Reiterated 03/24/26

The score is primarily held down by deteriorating financial performance—profitability turning to a loss and a sharp decline in operating/free cash flow. Technical indicators also point to a sustained downtrend. A relatively low P/E and modest dividend provide some valuation support but do not offset the recent fundamental and momentum weakness.

Positive Factors

Balance-sheet equity cushion

A sizeable equity base relative to assets provides a durable capital buffer to absorb cyclical losses or project overruns. This structural strength supports ongoing operations, reduces short-term distress risk, and preserves optionality for refinancing or selective investment over the next several months.

Historical profitability track record

Multi-year prior profitability demonstrates the underlying business model can generate mid-single-digit margins in normal conditions. That track record implies operational know-how, client relationships, and project execution capabilities that support a potential earnings recovery if revenue stabilizes.

Operational scale / workforce

A nearly 400-person workforce indicates established operational capacity and project execution resources typical for construction firms. This structural staffing supports backlog fulfillment, repeat client relationships, and the ability to scale operations as market activity recovers over the medium term.

Negative Factors

Sharp revenue decline and net loss

A substantial revenue drop combined with a swing to a net loss signals weakening demand or deteriorating project economics. Over several months this undermines margin sustainability, reduces reinvestment capacity, and makes recovery harder without sustained top-line stabilization or margin remediation.

Weak and volatile cash generation

Material deterioration in operating cash flow and a large free-cash-flow deficit increase funding and working-capital risk. Persistent cash burn would force reliance on external financing or asset sales, raising long-term cost of capital and constraining investment in backlog or efficiency improvements.

Rising leverage and declining returns

An upward trend in leverage alongside a swing to negative ROE reduces financial flexibility and increases interest and refinancing vulnerability. If profitability does not recover, higher leverage will exacerbate downside, limiting strategic options and pressuring liquidity over the medium term.

Nippon Chutetsukan K.K. Business Overview & Revenue Model

Company Description

Nippon Chutetsukan K.K. manufactures and sells ductile iron pipes and lids, polyethylene gas pipes, and valves primarily in Japan. It provides ductile iron pipes for applications in clean water, sewage, gas, industrial water, agricultural water, etc.; ductile cast iron deformed tubes; ductile iron covers for applications in water supply and sewage, gas, electricity, communication, etc.; polyethylene pipes for gas; valves and stoppers; accessories, such as push rings, rubber ring, and bolts and nuts; cast iron products; and water supply and on-site pipe laying works. Nippon Chutetsukan K.K. was founded in 1937 and is headquartered in Tokyo, Japan.

How the Company Makes Money

The company makes money primarily by manufacturing and selling cast-metal products to business and public-sector customers. Revenue is generated through (1) product sales (shipment-based revenue recognized on delivery/acceptance), typically driven by customer demand from infrastructure-related and industrial end markets; and (2) contract/processing income where the company performs casting and machining/finishing as part of customer-specified orders. Profitability is influenced by sales volume and product mix, selling prices, and input costs such as scrap/iron materials, energy, and logistics, as well as capacity utilization at its production facilities. null

Nippon Chutetsukan K.K. Financial Statement Overview

Summary

Recent fundamentals weakened sharply: revenue fell ~19% and profitability swung to a net loss (about -1.4% net margin) with broad margin compression. Operating cash flow dropped materially and free cash flow turned deeply negative, raising funding/working-capital risk. The balance sheet is still serviceable, but leverage has been rising and returns turned negative.

Income Statement

Profitability deteriorated meaningfully in the latest year: revenue fell ~19% (2025-03-31 annual) and net income turned to a loss (-1.4% net margin) after a positive 2024. Margins compressed across the board (gross margin ~15.7% vs ~20.2% prior year; EBIT margin ~1.5% vs ~4.6%), indicating weaker project economics and/or cost pressure. Earlier years (2020–2024) were generally profitable with moderate margins, but the sharp swing to a loss and declining revenue trajectory weighs on quality and consistency.

Balance Sheet

Leverage is moderate but rising: debt-to-equity increased to ~0.60 in 2025 from ~0.48 in 2024 (and ~0.38–0.42 in 2020–2023), reducing financial flexibility. Equity remains sizable (¥9.28B) relative to assets (¥22.22B), which provides some balance-sheet support, but returns weakened with negative return on equity in 2025 following positive mid-single-digit returns in 2023–2024. Overall, the balance sheet is not distressed, but the recent profitability setback and higher leverage trend are key watch items.

Cash Flow

Cash generation is volatile and recently weak: operating cash flow dropped to ¥142M in 2025 from ¥986M in 2024, and free cash flow swung to a large deficit (about -¥964M) after being slightly positive in 2024. History shows uneven conversion (including negative operating cash flow in 2023 and negative free cash flow in multiple years), suggesting working-capital swings and/or elevated investment needs. The latest year’s cash burn meaningfully increases funding risk if it persists.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	17.05B	16.93B	16.86B	17.29B	15.19B	14.66B
Gross Profit	2.69B	2.66B	3.35B	3.00B	2.70B	2.83B
EBITDA	720.00M	720.00M	1.28B	892.00M	708.00M	951.00M
Net Income	-146.00M	-230.00M	475.00M	362.00M	237.00M	661.00M
Balance Sheet
Total Assets	23.70B	22.22B	20.46B	18.60B	17.78B	17.13B
Cash, Cash Equivalents and Short-Term Investments	3.61B	2.91B	3.42B	2.19B	3.11B	3.68B
Total Debt	7.05B	5.61B	4.61B	3.43B	3.15B	3.15B
Total Liabilities	14.12B	12.58B	10.68B	9.82B	9.38B	8.83B
Stockholders Equity	9.21B	9.28B	9.43B	8.46B	8.09B	8.00B
Cash Flow
Free Cash Flow	0.00	-964.00M	77.00M	-936.00M	-50.00M	563.00M
Operating Cash Flow	0.00	142.00M	986.00M	-380.00M	419.00M	1.04B
Investing Cash Flow	0.00	-1.47B	-816.00M	-730.00M	-802.00M	-579.00M
Financing Cash Flow	0.00	820.00M	1.05B	193.00M	-183.00M	-234.00M

Nippon Chutetsukan K.K. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1833.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5612, the sentiment is Negative. The current price of 1833 is above the 20-day moving average (MA) of 1792.95, below the 50-day MA of 1853.68, and above the 200-day MA of 1737.07, indicating a bearish trend. The MACD of -42.86 indicates Positive momentum. The RSI at 40.44 is Neutral, neither overbought nor oversold. The STOCH value of 26.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:5612.

Nippon Chutetsukan K.K. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5958	80 Outperform	¥15.65B	5.32	―	3.58%	-3.74%	3.99%
5940	74 Outperform	¥11.38B	16.74	―	2.89%	2.56%	17.52%
5930	66 Neutral	¥126.22B	10.42	12.89%	3.40%	2.98%	41.11%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
5936	63 Neutral	¥5.96B	4.98	―	4.13%	2.76%	-10.23%
5938	50 Neutral	¥468.86B	16.11	1.44%	4.80%	0.68%	―
5612	46 Neutral	¥5.25B	10.87	―	1.57%	-0.86%	-162.79%