Chiyoda (6366) AI Stock Analysis

• Market Cap: ¥297.29B
• Dividend Yield: N/A
• Average Volume (3M): 1.29M
• Price to Earnings (P/E): 0.8
• Beta (1Y): 0.90
• Revenue Growth: -12.14%
• EPS Growth: N/A
• Country: JP
• Employees: 3,496
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): N/A
• Shares Outstanding: 260,324,520
• 10 Day Avg. Volume: 1,229,890
• 30 Day Avg. Volume: 1,293,136
• PEG Ratio: -0.01
• Price to Book (P/B): 3.68
• Price to Sales (P/S): 0.19
• P/FCF Ratio: 1.56
• 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: 74 Outperform
• Price Target: ¥1,375.00 ▲(64.87% Upside)
• Action: Reiterated Date: 03/19/26
• Date: Action: Reiterated 03/19/26

The score is driven primarily by improved financial performance (profitability turnaround and strong free cash flow) and an extremely low P/E valuation. Offsetting factors include negative revenue growth, a low equity ratio, and technical momentum that is positive on trend but weakened by a negative MACD.

Positive Factors

Profitability turnaround

Chiyoda's shift from negative to positive gross (9.26%) and net (5.91%) margins reflects improved project pricing and execution controls. That structural improvement supports sustained earnings generation, reducing reliance on one-off gains and improving ability to fund operations and service debt over the medium term.

Strong free cash flow

Robust free cash flow demonstrates durable cash conversion from operations, providing funding for working capital, capex and debt reduction. Persistent FCF at this scale strengthens liquidity buffers, lowers refinancing needs and supports resilience through project cycles over multiple quarters.

Manageable leverage and liquidity

A near-1.0 debt-to-equity ratio and higher equity alongside significant cash reserves indicate a balanced capital structure and available liquidity. This improves capacity to fund bids, absorb project timing shocks and meet obligations, enhancing credit profile and operational flexibility over the medium term.

Negative Factors

Negative revenue trend

Declining revenue undermines scale and the firm's ability to spread fixed costs, making margins more vulnerable to project cost swings. Without a sustained recovery in new contract awards or service-fee work, profitability gains and cash generation may be harder to maintain over the next several quarters.

Low equity ratio

A low equity ratio indicates limited shareholder buffer relative to total assets. This structural weakness raises the company's sensitivity to losses or large project write-downs, could constrain access to capital in stress scenarios, and increases the long-term risk profile despite current liquidity.

Execution risk from lump‑sum EPC contracts

Chiyoda's business includes lump-sum EPC contracts that transfer cost and schedule risk to the contractor. Structural exposure to overruns, logistics and subcontractor issues can produce volatile margins and episodic cash drains, threatening sustainable earnings if contract mix remains weighted to fixed-price work.

Chiyoda Business Overview & Revenue Model

Company Description

Chiyoda Corporation operates as an integrated engineering company in Japan and internationally. It offers consulting, planning, engineering, procurement, construction, commissioning, and maintenance services for facilities related to gas, electricity, petroleum, petrochemical, chemical, pharmaceutical, antipollution, environment, preservation, and others. The company also explores for oil, gas, and other mineral resources, as well as invests in and finances exploration activities. Chiyoda Corporation was incorporated in 1948 and is headquartered in Yokohama, Japan.

How the Company Makes Money

Chiyoda primarily makes money by executing EPC and related project contracts for industrial plants. Revenue is mainly recognized from (1) EPC project execution: Chiyoda bids for plant construction projects and, when awarded, earns contract revenue tied to project progress/milestones or percentage-of-completion depending on the contract and accounting treatment. Its gross profit is the spread between contracted project revenue and the total costs to deliver (engineering labor, subcontracted construction work, purchased equipment/materials, logistics, and project management). (2) Engineering and project management services: On some engagements, Chiyoda provides front-end engineering/design (FEED), basic engineering, detailed engineering, or project management/consulting services that generate service fees, sometimes preceding or independent of a full EPC award. (3) Procurement and construction management: For contracts structured as EPCM/PMC (engineering, procurement and construction management / project management consultancy), Chiyoda earns management fees rather than taking full construction cost/price risk, with margins driven by staffing and efficiency. (4) After-completion and support work: The company can earn additional revenue from commissioning support, modifications, debottlenecking, maintenance-related engineering, and other lifecycle services tied to installed plants. Key factors influencing earnings include success in winning large projects, the mix between lump-sum EPC versus fee-based management contracts (risk and margin profile), control of project costs and schedules (cost overruns can materially reduce profitability on fixed-price work), client/industry capital spending cycles in energy and petrochemicals, and performance on major overseas projects where currency, logistics, and subcontractor execution can affect margins. Specific significant partnerships: null.

Chiyoda Financial Statement Overview

Summary

Profitability rebounded in 2025 with gross and net margins turning positive and improved EBIT/EBITDA margins. Cash generation is strong with sizable free cash flow, supporting operations and leverage. Key offset is negative revenue growth and a low equity ratio, which adds balance-sheet risk in weaker markets.

Income Statement

Chiyoda's income statement shows a mixed performance. The gross profit margin improved significantly from a negative margin in 2024 to a positive 9.26% in 2025, reflecting a recovery in profitability. The net profit margin also turned positive at 5.91% in 2025, indicating a turnaround from previous losses. However, revenue growth is negative at -9.68%, suggesting challenges in sustaining top-line growth. EBIT and EBITDA margins have improved to 5.34% and 8.07% respectively in 2025, showing enhanced operational efficiency.

Balance Sheet

Chiyoda's balance sheet reflects a stable equity position with a notable increase in stockholders' equity to ¥23.7 billion in 2025. The debt-to-equity ratio stands at 0.99, indicating a balanced capital structure with manageable leverage. The equity ratio is relatively low at 5.14%, which suggests potential vulnerability to financial instability. The company maintains strong liquidity with significant cash reserves, enhancing its ability to meet short-term obligations.

Cash Flow

Chiyoda's cash flow statement indicates strong free cash flow of ¥55.97 billion in 2025, with a slight decline from the previous year. The operating cash flow to net income ratio is robust, suggesting efficient cash generation from operations. However, the free cash flow growth rate is negative, reflecting challenges in sustaining cash flow growth. Overall, the cash flow position supports operational needs and debt management effectively.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	430.41B	456.97B	505.98B	430.16B	311.12B	315.39B
Gross Profit	40.89B	42.32B	-157.00M	32.71B	22.79B	20.06B
EBITDA	38.18B	36.88B	-2.03B	24.95B	-5.29B	13.08B
Net Income	29.34B	26.99B	-15.83B	15.19B	-12.63B	7.99B
Balance Sheet
Total Assets	433.10B	461.03B	426.97B	406.59B	395.40B	329.58B
Cash, Cash Equivalents and Short-Term Investments	285.13B	377.29B	315.29B	269.88B	220.23B	163.83B
Total Debt	23.60B	24.95B	25.49B	30.36B	46.90B	46.81B
Total Liabilities	401.40B	435.57B	420.89B	384.27B	379.63B	292.83B
Stockholders Equity	29.87B	23.71B	4.86B	22.18B	15.65B	36.40B
Cash Flow
Free Cash Flow	0.00	55.97B	45.68B	59.85B	56.57B	-59.01B
Operating Cash Flow	0.00	57.66B	47.43B	60.80B	57.09B	-58.40B
Investing Cash Flow	0.00	-4.18B	-1.57B	7.89B	-3.79B	-2.25B
Financing Cash Flow	0.00	-298.00M	-5.85B	-17.06B	-4.20B	9.48B

Chiyoda Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 834.00
• 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:6366, the sentiment is Positive. The current price of 834 is below the 20-day moving average (MA) of 1202.95, below the 50-day MA of 1179.26, and above the 200-day MA of 640.57, indicating a bullish trend. The MACD of -44.39 indicates Positive momentum. The RSI at 53.07 is Neutral, neither overbought nor oversold. The STOCH value of 54.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6366.

Chiyoda Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6366	74 Outperform	¥297.29B	0.79	164.12%	―	-12.14%	―
1959	74 Outperform	¥681.82B	12.93	―	2.15%	-5.20%	-1.20%
1942	72 Outperform	¥1.27T	12.95	14.94%	2.00%	16.43%	53.76%
1963	65 Neutral	¥506.80B	6.30	-0.24%	2.10%	-0.41%	80.25%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6330	53 Neutral	¥211.54B	-3.11	-33.76%	0.96%	-5.80%	-126.63%