Dijet Industrial Co., Ltd. (6138) AI Stock Analysis

• Market Cap: ¥3.59B
• Dividend Yield: 2.66%
• Average Volume (3M): 7.71K
• Price to Earnings (P/E): 5.9
• Beta (1Y): 0.46
• Revenue Growth: 3.89%
• EPS Growth: N/A
• Country: JP
• Employees: 375
• Sector: Industrials
• Sector Strength: 72
• Industry: Manufacturing - Metal Fabrication
• EPS (TTM): 86.31
• Shares Outstanding: 2,992,999
• 10 Day Avg. Volume: 6,940
• 30 Day Avg. Volume: 7,710
• PEG Ratio: -0.04
• Price to Book (P/B): 0.27
• Price to Sales (P/S): 0.24
• P/FCF Ratio: 2.30
• 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: 77 Outperform
• Price Target: ¥1,340.00 ▲(39.15% Upside)
• Action: Upgraded Date: 02/13/26
• Date: Action: Upgraded 02/13/26

The score is driven primarily by strong financial performance (especially cash flow growth) and very attractive valuation (low P/E with dividend support). Technicals are supportive due to an uptrend, but the very high RSI indicates overbought conditions, which tempers the overall score.

Positive Factors

Strong cash generation (free cash flow)

A >100% jump in free cash flow and an operating-cash-to-net-income ratio of 6.84 indicate durable cash conversion. Sustained FCF improves ability to fund capex, R&D, dividends, and debt service without reliance on external financing, strengthening medium-term financial flexibility.

Moderate leverage and stable capital structure

A debt-to-equity near 0.67 and ~50% equity ratio suggest balanced leverage that supports investment while limiting solvency risk. This capital structure allows the company to manage growth and cyclicality over months without excessive refinancing pressure, preserving strategic optionality.

Improving margins with steady revenue growth

Positive top-line growth alongside rising gross margin reflects better operational efficiency and product mix. Even with a low net margin, the trend of improving profitability supports longer-term margin expansion potential from higher-value inserts and cost controls, aiding sustainable earnings.

Negative Factors

Low net profit margin

A sub-3% net margin leaves limited buffer against cost shocks or volume declines. Persistently thin bottom-line profitability constrains reinvestment and dividend flexibility, and requires continued efficiency gains to meaningfully improve retained earnings and capital resilience over months.

High exposure to tungsten/raw material costs

Product economics depend on tungsten/carbide input prices, which can be volatile. Structural raw-material exposure can erode gross margins if price increases are sustained and difficult to fully pass to customers, posing a persistent operational margin risk over the medium term.

Cyclicality of end-market demand

Revenue tied to cyclical manufacturing and automotive machining creates sensitivity to industrial cycles. Reduced OEM or machining activity can cut consumable insert replacements and tooling orders, producing multi-month volatility in sales and cash flow under weaker macro conditions.

Dijet Industrial Co., Ltd. Business Overview & Revenue Model

Company Description

Dijet Industrial Co., Ltd. engages in the manufacture and sale of cemented carbide tools worldwide. It offers tuff modular system, drill, indexable and solid end mill, face mill, coated and non-coated inserts, sintered CBN and diamond inserts, cermet inserts, and wear and impact resistant tool products. The company was formerly known as Hyakunen Industrial Co., Ltd. and changed its name to Dijet Industrial Co., Ltd. in June 1954. Dijet Industrial Co., Ltd. was founded in 1938 and is headquartered in Osaka, Japan.

How the Company Makes Money

Dijet Industrial Co., Ltd. generates revenue primarily through the sale of its cutting tools and related products. The company's revenue model is based on direct sales to manufacturers and distributors in various industries, including automotive and aerospace. Key revenue streams include standard cutting tools, custom tooling solutions, and related services such as tool design and optimization. Dijet also benefits from strategic partnerships with industry leaders and distributors, which help expand its market reach and enhance its product offerings. The company's focus on research and development allows it to maintain a competitive edge, driving sales through innovative and high-quality products.

Dijet Industrial Co., Ltd. Financial Statement Overview

Summary

Solid fundamentals: revenue grew 5.38%, profitability margins improved (gross 34.24%, net 2.34%), and cash flow is a key strength with free cash flow up 104.09% and a strong operating cash flow to net income ratio (6.84). Balance sheet is stable (debt-to-equity 0.67, equity ratio 49.75%) but leverage and low net margin remain watch items.

Income Statement

The income statement shows a steady increase in revenue with a 5.38% growth in the latest year. Gross and net profit margins have improved to 34.24% and 2.34% respectively, reflecting better operational efficiency. However, the net profit margin remains relatively low, indicating room for improvement in cost management.

Balance Sheet

The balance sheet is moderately strong with a debt-to-equity ratio of 0.67, indicating a balanced leverage position. The equity ratio stands at 49.75%, showing a stable capital structure. However, there is a need to monitor the debt levels to ensure long-term stability.

Cash Flow

Cash flow performance is robust with a significant increase in free cash flow by 104.09%. The operating cash flow to net income ratio is favorable at 6.84, highlighting strong cash generation relative to net income. However, continued focus on maintaining positive free cash flow is essential.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	9.00B	8.79B	8.34B	8.80B	8.07B	7.09B
Gross Profit	3.19B	3.01B	2.71B	2.92B	2.34B	1.85B
EBITDA	1.45B	1.27B	1.24B	1.48B	1.08B	566.00M
Net Income	376.47M	205.42M	-130.97M	362.28M	64.77M	-643.49M
Balance Sheet
Total Assets	16.31B	15.96B	16.47B	16.39B	16.08B	16.15B
Cash, Cash Equivalents and Short-Term Investments	2.11B	1.35B	1.39B	1.24B	1.20B	1.58B
Total Debt	5.56B	5.31B	6.00B	6.09B	6.20B	6.45B
Total Liabilities	8.36B	8.02B	8.66B	8.89B	8.90B	9.20B
Stockholders Equity	7.95B	7.94B	7.80B	7.50B	7.18B	6.95B
Cash Flow
Free Cash Flow	0.00	915.05M	448.30M	269.89M	-295.09M	87.66M
Operating Cash Flow	0.00	1.40B	718.22M	692.19M	104.52M	1.17B
Investing Cash Flow	0.00	-519.82M	-263.12M	-327.35M	-15.03M	-1.07B
Financing Cash Flow	0.00	-924.17M	-343.70M	-341.69M	-477.60M	213.20M

Dijet Industrial Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 963.00
• 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:6138, the sentiment is Positive. The current price of 963 is below the 20-day moving average (MA) of 1135.65, below the 50-day MA of 1055.88, and below the 200-day MA of 963.62, indicating a bullish trend. The MACD of 46.16 indicates Negative momentum. The RSI at 66.77 is Neutral, neither overbought nor oversold. The STOCH value of 61.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6138.

Dijet Industrial Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6138	77 Outperform	¥3.59B	5.93	―	2.66%	3.89%	―
5644	72 Outperform	¥16.90B	7.44	―	2.87%	2.38%	-5.80%
6998	71 Outperform	¥10.97B	15.68	―	3.48%	0.24%	20.23%
5994	69 Neutral	¥7.57B	4.62	―	1.06%	6.41%	―
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6150	63 Neutral	¥3.15B	12.41	―	2.66%	-17.16%	-47.34%
5852	54 Neutral	¥23.17B	10.25	―	4.33%	5.12%	―