Daiki Aluminium Industry Co., Ltd. (5702) AI Stock Analysis

• Market Cap: ¥53.18B
• Dividend Yield: 4.88%
• Average Volume (3M): 84.57K
• Price to Earnings (P/E): 13.9
• Beta (1Y): 0.73
• Revenue Growth: 16.98%
• EPS Growth: -96.24%
• Country: JP
• Employees: 1,265
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Aluminum
• EPS (TTM): 21.64
• Shares Outstanding: 43,629,234
• 10 Day Avg. Volume: 121,780
• 30 Day Avg. Volume: 84,566
• PEG Ratio: -0.73
• Price to Book (P/B): 0.54
• Price to Sales (P/S): 0.13
• P/FCF Ratio: -2.85
• 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: 59 Neutral
• Price Target: ¥1,371.00 ▲(13.68% Upside)
• Action: Reiterated Date: 10/23/25
• Date: Action: Reiterated 10/23/25

The overall stock score for Daiki Aluminium Industry Co., Ltd. is primarily influenced by its mixed financial performance, with operational challenges and negative cash flow trends. Positive technical indicators provide some support, but the high P/E ratio suggests potential overvaluation concerns.

Positive Factors

Recycled-aluminum business model

Daiki’s core model of processing scrap into secondary aluminum aligns with long-term circular-economy and decarbonization trends. Durable demand from industrial and automotive users for recycled alloys supports steady volumes and cost advantages versus primary smelting over multiple cycles.

Revenue growth trajectory

Recent top-line expansion indicates improving sales momentum and the ability to win or retain volume in end markets. Sustained revenue growth helps absorb fixed costs, supports scale benefits in processing, and provides a base to restore margins if operational efficiency or pricing normalizes.

Stable equity ratio / moderate balance sheet

The company’s balance sheet shows a stable equity ratio and moderate overall positioning, offering a cushioning capital base. This stability aids multi‑period resilience, enabling continued operations and investment capability while management addresses operating and cash‑flow weaknesses.

Negative Factors

Falling profitability margins

Sharp margin erosion signals weakening pricing power or rising input and energy costs relative to selling prices. Persistently thin net margins undermine internal capital generation, reduce returns on equity, and increase vulnerability to commodity price swings and cost inflation over coming quarters.

Negative free cash flow

Sustained negative free cash flow constrains the firm’s ability to fund capex, deleverage, or return capital without external financing. Over months, weak cash conversion forces dependence on borrowings or equity, reducing strategic flexibility and raising refinancing risk if conditions tighten.

Rising leverage

Higher leverage increases fixed financing costs and reduces buffer against cyclicality in the aluminum sector. Combined with low margins and negative FCF, rising debt amplifies downside risk, limits capacity for strategic investments, and could pressure liquidity if industry headwinds persist.

Daiki Aluminium Industry Co., Ltd. Business Overview & Revenue Model

Company Description

Daiki Aluminium Industry Co., Ltd. manufactures, processes, markets, and sells aluminum alloy products in Japan and internationally. It offers secondary aluminum alloy ingots for die-casting, casting, deoxidation, and rolling; secondary aluminum ingots for roll products; and aluminum mother alloy ingots. The company also engages in the design, construction, and repair of aluminum smelting furnaces; and sale of aluminum alloy ingots, melting equipment, and aluminum scrap. Daiki Aluminium Industry Co., Ltd. was founded in 1922 and is headquartered in Osaka, Japan.

How the Company Makes Money

Daiki Aluminium Industry Co., Ltd. makes money primarily by selling secondary (recycled) aluminum alloy products—especially aluminum alloy ingots—to manufacturers that use these materials as inputs for casting and component production (notably in automotive supply chains). Its core revenue model is product sales: the company procures aluminum scrap and other recyclable inputs, processes and melts them, adjusts alloy compositions to meet customer specifications, and sells the resulting alloy ingots/materials. Earnings are driven by sales volumes, product mix (different alloy grades/specifications), and the spread between procurement costs for scrap/raw materials, processing/energy/logistics costs, and realized selling prices that are influenced by aluminum market pricing and customer contract terms. Information on specific customer names, partnerships, or segment-by-segment revenue breakdowns is null.

Daiki Aluminium Industry Co., Ltd. Financial Statement Overview

Summary

Daiki Aluminium Industry Co., Ltd. presents a mixed financial picture. Revenue growth is promising, but declining margins and profitability metrics suggest operational challenges. Increasing leverage and negative cash flow trends warrant careful management to ensure financial stability.

Income Statement

Daiki Aluminium Industry Co., Ltd. showed a mixed performance in its income statement. The gross profit margin has experienced slight fluctuations but remained stable, while net profit margin showed a steep decline over the years, reaching a mere 0.23% in 2025 from a healthier 6.3% in 2023. Revenue growth has been inconsistent, with a significant increase in 2025 by 14.13% but a decline in 2024. The EBIT and EBITDA margins have also decreased over time, indicating potential challenges in operational efficiency.

Balance Sheet

The balance sheet reflects a moderate financial position. The debt-to-equity ratio increased, indicating rising leverage, which could pose a risk if not managed carefully. The return on equity (ROE) is declining, showing a decrease in profitability. However, the equity ratio remains stable, suggesting a balanced asset management approach. The company's increasing liabilities may pose a financial risk if revenue generation does not improve.

Cash Flow

The cash flow position is concerning, with negative free cash flow in recent years. The free cash flow growth rate has been volatile, and the operating cash flow to net income ratio indicates inefficiencies in converting income to cash. Despite positive operating cash flow in 2023, the company struggled to maintain a healthy cash flow balance due to high capital expenditures and financing activities.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	311.98B	299.80B	262.67B	273.03B	236.06B	139.19B
Gross Profit	14.49B	13.43B	12.71B	22.71B	29.04B	15.94B
EBITDA	9.56B	8.86B	8.30B	17.24B	23.57B	12.16B
Net Income	833.00M	698.00M	3.24B	9.73B	14.88B	6.14B
Balance Sheet
Total Assets	154.30B	163.29B	138.68B	133.22B	141.62B	97.57B
Cash, Cash Equivalents and Short-Term Investments	8.14B	7.34B	6.38B	4.96B	4.86B	5.78B
Total Debt	60.45B	67.32B	48.29B	42.22B	58.82B	38.13B
Total Liabilities	83.68B	89.58B	66.61B	64.84B	83.11B	53.78B
Stockholders Equity	70.04B	73.07B	71.39B	67.63B	57.72B	43.23B
Cash Flow
Free Cash Flow	-5.24B	-13.95B	-2.05B	22.10B	-19.04B	-9.30B
Operating Cash Flow	-4.44B	-10.04B	2.80B	26.16B	-15.62B	-4.52B
Investing Cash Flow	-956.00M	-4.20B	-3.64B	-4.58B	-3.42B	-4.97B
Financing Cash Flow	6.29B	14.57B	2.22B	-21.66B	17.91B	6.22B

Daiki Aluminium Industry Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1206.00
• 50DMA: Negative
• 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:5702, the sentiment is Negative. The current price of 1206 is below the 20-day moving average (MA) of 1395.00, below the 50-day MA of 1366.52, and above the 200-day MA of 1150.19, indicating a neutral trend. The MACD of -7.38 indicates Positive momentum. The RSI at 42.20 is Neutral, neither overbought nor oversold. The STOCH value of 54.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:5702.

Daiki Aluminium Industry Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5703	72 Outperform	¥169.36B	6.54	6.34%	3.02%	6.23%	11.86%
5726	71 Outperform	¥87.95B	19.55	―	1.38%	-3.56%	-30.17%
5440	70 Outperform	¥102.48B	10.61	―	3.70%	-3.06%	1.15%
3036	68 Neutral	¥84.92B	7.97	―	2.98%	8.89%	102.20%
5741	64 Neutral	¥419.50B	5.47	6.36%	1.91%	11.31%	-25.76%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
5702	59 Neutral	¥53.18B	13.94	0.07%	4.88%	16.98%	-96.24%

Daiki Aluminium Industry Co., Ltd. Corporate Events

Daiki Aluminium Lifts Nine-Month Profits and Confirms Dividend, Keeps Full-Year Outlook

Daiki Aluminium Industry reported consolidated net sales of ¥232.5 billion for the nine months ended December 31, 2025, up 9.1% year on year, with operating profit climbing 28.1% to ¥4.5 billion and profit attributable to owners of parent rising 24.6% to ¥1.8 billion. Despite this earnings growth, comprehensive income fell sharply, and the equity ratio declined to 41.5% as total assets expanded, signaling some balance sheet pressure even as profitability improves.

The company confirmed its dividend plan for the fiscal year ending March 31, 2026, maintaining a total forecast payout of ¥55 per share, and it left its full-year outlook unchanged, projecting 5.8% growth in net sales and a 26.4% rise in operating profit. The maintenance of guidance and dividends suggests management’s confidence in earnings momentum and cash generation, which is likely to reassure shareholders amid a volatile metals market environment.

The most recent analyst rating on (JP:5702) stock is a Hold with a Yen1340.00 price target. To see the full list of analyst forecasts on Daiki Aluminium Industry Co., Ltd. stock, see the JP:5702 Stock Forecast page.