Kanematsu Engineering Co., Ltd. (6402) AI Stock Analysis

• Market Cap: ¥9.92B
• Dividend Yield: 2.15%
• Average Volume (3M): 6.78K
• Price to Earnings (P/E): 9.6
• Beta (1Y): 0.57
• Revenue Growth: -0.94%
• EPS Growth: 6.93%
• Country: JP
• Employees: 156
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 62.65
• Shares Outstanding: 5,564,000
• 10 Day Avg. Volume: 6,030
• 30 Day Avg. Volume: 6,780
• PEG Ratio: 0.61
• Price to Book (P/B): 0.78
• Price to Sales (P/S): 0.42
• P/FCF Ratio: 8.58
• 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: 73 Outperform
• Price Target: ¥2,006.00 ▲(32.85% Upside)
• Action: Reiterated Date: 10/30/25
• Date: Action: Reiterated 10/30/25

Kanematsu Engineering's strong financial performance and reasonable valuation are the primary drivers of its stock score. Technical analysis suggests some short-term weakness but maintains a positive long-term outlook. The absence of earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Low leverage

A debt-to-equity ratio of 0.21 indicates low financial leverage, reducing solvency risk and preserving borrowing capacity. Over 2-6 months this supports stable operations, enables opportunistic investing or acquisitions, and cushions the business against cyclical downturns in industrial machinery demand.

Positive free cash flow

Transition from negative to positive free cash flow and an OCF/net income ratio ~1.05 show the company now converts earnings into cash reliably. Durable cash generation supports capex, working capital needs, and steady dividend or debt reduction policies, strengthening long-term financial flexibility.

Healthy operating margins

Sustained gross and operating margins above peers indicate cost discipline and operational efficiency in machinery operations. These margins provide a structural buffer against input-cost inflation and cyclical revenue swings, supporting steady profitability and reinvestment capacity over the medium term.

Negative Factors

Inconsistent revenue trend

A roughly -11% revenue growth reading in fundamentals suggests underlying top-line pressure or recent contraction despite isolated annual gains. Over several months this undermines scale economics, risks margin erosion, and raises questions about demand stability or customer concentration in the industrial machinery segment.

Cash flow volatility risk

Although free cash flow is now positive, documented historical fluctuations mean cash generation can revert under stress. For capital-intensive machinery firms, volatile cash flows constrain consistent capex, maintenance, and shareholder returns, and increase reliance on external financing during downturns.

Modest net margin

A net margin around 5.3% leaves a relatively thin profitability buffer against rising raw-material, labor, or warranty costs typical in machinery manufacturing. Over the medium term, limited room to absorb cost shocks could compress returns and slow reinvestment or dividend growth if revenue weakens.

Kanematsu Engineering Co., Ltd. Business Overview & Revenue Model

Company Description

Kanematsu Engineering Co., Ltd. (6402) is a Japanese company specializing in engineering and manufacturing solutions, primarily focusing on advanced technologies in the fields of electronics, machinery, and precision instruments. The company operates in various sectors, including semiconductor manufacturing equipment, industrial machinery, and environmental systems. Kanematsu Engineering is known for its innovative products and services, which cater to both domestic and international markets, enhancing operational efficiencies and technological advancements for its clients.

How the Company Makes Money

Kanematsu Engineering Co., Ltd. generates revenue through a multifaceted business model that includes the sale of high-tech equipment and systems used in semiconductor production and industrial applications. Key revenue streams come from the manufacturing and supply of specialized machinery, consulting services, and maintenance contracts for installed systems. The company also benefits from partnerships with leading technology firms and suppliers, enabling access to cutting-edge technologies and expanding its market reach. Additionally, Kanematsu Engineering engages in research and development to create new products, which helps sustain its competitive advantage and drive growth in emerging markets.

Kanematsu Engineering Co., Ltd. Financial Statement Overview

Summary

Kanematsu Engineering shows robust financial health with strong revenue growth and improving profitability. The balance sheet is solid with low leverage, and the cash flow situation has improved significantly, though previous volatility should be monitored.

Income Statement

Kanematsu Engineering has shown a consistent revenue growth with a significant jump of 7.23% in the latest year. Gross profit margin stands at a healthy 22.8% for 2025, indicating efficient cost management. Net profit margin improved slightly to 5.27%, reflecting better profitability. The EBIT margin of 7.18% and EBITDA margin of 10.63% in 2025 are strong for the industry, showing operational efficiency gains.

Balance Sheet

The company's debt-to-equity ratio is conservative at 0.21, suggesting low leverage, which reduces financial risk. The return on equity (ROE) of 9.81% in 2025 highlights profitable use of shareholders' equity. However, the equity ratio of 59.11% indicates a solid financial position with a strong buffer against liabilities.

Cash Flow

Kanematsu Engineering has improved its free cash flow from negative in previous years to a positive 651.97 million yen in 2025. The operating cash flow to net income ratio of 1.05 suggests solid cash generation capability relative to profits, although historical fluctuations in cash flows pose some risk.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	13.30B	12.40B	11.34B	11.87B	11.61B
Gross Profit	3.03B	2.83B	2.68B	2.80B	2.79B
EBITDA	1.41B	1.27B	1.48B	1.33B	1.17B
Net Income	700.69M	618.92M	754.36M	750.28M	716.86M
Balance Sheet
Total Assets	12.08B	13.38B	13.75B	12.81B	11.08B
Cash, Cash Equivalents and Short-Term Investments	1.58B	1.50B	2.38B	967.51M	1.42B
Total Debt	1.49B	1.83B	2.18B	2.46B	0.00
Total Liabilities	4.94B	6.74B	7.47B	7.10B	4.86B
Stockholders Equity	7.14B	6.64B	6.29B	5.71B	6.22B
Cash Flow
Free Cash Flow	651.97M	-262.33M	1.95B	-2.33B	-899.82M
Operating Cash Flow	733.30M	-111.96M	2.28B	-243.69M	939.66M
Investing Cash Flow	-83.51M	-150.63M	-334.95M	-1.29B	-897.20M
Financing Cash Flow	-568.34M	-615.44M	-541.04M	1.18B	-235.28M

Kanematsu Engineering Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1510.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6402, the sentiment is Positive. The current price of 1510 is below the 20-day moving average (MA) of 1731.75, below the 50-day MA of 1671.98, and above the 200-day MA of 1448.44, indicating a bullish trend. The MACD of 37.78 indicates Negative momentum. The RSI at 67.92 is Neutral, neither overbought nor oversold. The STOCH value of 82.07 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6402.

Kanematsu Engineering Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6286	84 Outperform	¥11.63B	9.40	―	1.60%	11.62%	16.48%
6391	74 Outperform	¥6.15B	9.69	―	1.19%	-14.09%	-36.08%
6402	73 Outperform	¥9.92B	9.59	―	2.15%	-0.94%	6.93%
6158	71 Outperform	¥6.90B	58.08	―	4.08%	-11.74%	-46.96%
6346	69 Neutral	¥8.10B	13.87	―	2.42%	3.68%	-14.90%
5903	69 Neutral	¥6.84B	14.32	―	3.51%	4.29%	3.00%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%