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

• Market Cap: ¥52.98B
• Dividend Yield: 4.88%
• Average Volume (3M): 84.57K
• Price to Earnings (P/E): 623.6
• Beta (1Y): 0.65
• Revenue Growth: 16.98%
• EPS Growth: -96.24%
• Country: JP
• Employees: 1,265
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Aluminum
• EPS (TTM): 8.12
• 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: ¥1,366.00 ▲(13.27% Upside)

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

Recycling-based business model

Daiki's core business of recycling and producing secondary aluminum alloys supplies automotive and industrial manufacturers with essential inputs. Structural demand for lighter, recycled materials and circular-economy pressure supports stable long-term volumes and repeat customers.

Recent revenue growth

Nearly 17% reported revenue growth indicates expanding sales or higher volumes, suggesting improving market penetration. If driven by durable contract wins or volume adoption in auto supply chains, this supports sustainable cash generation and scale benefits over the next several quarters.

Stable equity ratio

A stable equity ratio signals that assets remain largely funded by equity, providing a buffer against shocks. This supports long-term solvency, enabling the company to absorb cyclical commodity swings and maintain access to funding for necessary capex or modernization.

Negative Factors

Compressing net margins

A collapse in net margin to near-zero materially weakens the company's ability to cover capital needs and withstand input-price swings. Persistently thin margins reduce reinvestment capacity, increase reliance on external financing, and heighten vulnerability to cyclical downturns in aluminum markets.

Negative free cash flow

Sustained negative free cash flow undermines financial flexibility: it limits ability to pay down debt, fund capital expenditure, or return cash to shareholders. Over months, continued negative FCF forces reliance on new borrowing or asset sales, raising refinancing and operational risks.

Rising leverage

Increasing debt-to-equity raises interest burden and reduces resilience to cyclical downturns. Given deteriorating margins and negative FCF, higher leverage compounds solvency risk and constrains strategic choices, making the company more sensitive to rate moves and commodity shocks.

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 generates revenue through the production and sale of aluminum products, which are supplied to various sectors such as construction, automotive, and industrial manufacturing. The company benefits from a diversified revenue model that includes direct sales to end-users, as well as partnerships with manufacturers and distributors. Key revenue streams include custom aluminum extrusions, fabricated components, and standard aluminum products. Additionally, Daiki Aluminium invests in research and development to enhance product performance and expand its market reach, further contributing to its earnings. The company's strategic focus on sustainability and eco-friendly practices also positions it favorably in a market increasingly driven by environmental concerns.

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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	311.98B	299.80B	262.67B	273.03B	236.06B	139.19B
Gross Profit	14.17B	13.43B	13.03B	23.00B	29.26B	16.13B
EBITDA	8.70B	8.15B	10.16B	17.24B	24.41B	12.26B
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	67.27B	48.25B	42.16B	58.78B	38.07B
Total Liabilities	83.68B	89.58B	66.62B	64.85B	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: Positive
• Last Price: 1206.00
• 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:5702, the sentiment is Positive. The current price of 1206 is below the 20-day moving average (MA) of 1304.40, above the 50-day MA of 1189.44, and above the 200-day MA of 1067.50, indicating a bullish trend. The MACD of 37.20 indicates Positive momentum. The RSI at 60.29 is Neutral, neither overbought nor oversold. The STOCH value of 34.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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	77 Outperform	¥169.11B	11.73	5.71%	3.02%	6.23%	11.86%
5741	71 Outperform	¥452.46B	24.40	6.36%	1.91%	11.31%	-25.76%
5480	71 Outperform	¥72.05B	7.12	―	5.15%	-9.28%	-7.18%
5726	71 Outperform	¥84.56B	13.90	―	1.38%	-3.56%	-30.17%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
5410	61 Neutral	¥58.51B	5.89	―	6.27%	-7.45%	-9.12%
5702	59 Neutral	¥52.98B	623.63	0.07%	4.88%	16.98%	-96.24%

Daiki Aluminium Industry Co., Ltd. Corporate Events

Daiki Aluminium Reports Increased Sales but Declining Profits

Daiki Aluminium Industry Co., Ltd. reported a 9.7% increase in net sales for the six months ended September 30, 2025, compared to the same period in the previous year. However, the company experienced declines in operating profit, ordinary profit, and profit attributable to owners of the parent, indicating potential challenges in maintaining profitability. Despite these challenges, the company forecasts a positive outlook for the fiscal year ending March 31, 2026, with expected growth in net sales and profits.

The most recent analyst rating on (JP:5702) stock is a Hold with a Yen1193.00 price target. To see the full list of analyst forecasts on Daiki Aluminium Industry Co., Ltd. stock, see the JP:5702 Stock Forecast page.