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

• Market Cap: ¥11.08B
• Dividend Yield: 2.15%
• Average Volume (3M): 6.78K
• Price to Earnings (P/E): 6.4
• Beta (1Y): 0.45
• 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: 79 Outperform
• Price Target: ¥2,222.00 ▲(47.15% Upside)
• Action: Reiterated Date: 03/04/26
• Date: Action: Reiterated 03/04/26

The score is driven primarily by strong financial performance (healthy margins, solid balance sheet, and improved free cash flow) and an attractive valuation (P/E 9.91). Technicals are supportive due to a strong uptrend, but extremely overbought RSI/Stoch readings add near-term risk and cap the upside in the score.

Positive Factors

Revenue & Gross Margin

Consistent revenue uptick (+7.23%) alongside a 22.8% gross margin indicates durable product demand and effective cost control. That margin profile supports reinvestment in operations and provides resilience to input-cost fluctuations, sustaining medium-term profitability.

Low Leverage / Strong Balance Sheet

A conservative debt-to-equity ratio (0.21) and a 59.11% equity ratio give the company financing flexibility and a large liability buffer. Low leverage reduces refinancing and interest-rate risk, enabling stable capital allocation and resilience through economic cycles.

Improved Cash Generation

The move to positive free cash flow (651.97M yen) with OCF roughly matching net income (1.05x) strengthens self-funding capacity. Improved cash generation supports funding for maintenance, selective growth investments, or shareholder returns without raising external capital.

Negative Factors

Cash Flow Volatility

Despite recent positive free cash flow, the company’s historical cash-flow fluctuations reduce predictability of available funds. That variability complicates multi-period planning for capex, dividends or debt repayment and raises execution risk during downcycles.

Inconsistent Revenue Signals

The dataset shows conflicting top-line indicators (a negative RevenueGrowth metric versus a reported +7.23% year), reflecting uneven reporting windows or recent variability. This inconsistency undermines visibility into sustainable demand and complicates forecasting over several quarters.

Modest Net Profitability

A net margin of only ~5.27% provides a limited buffer against cost increases or weaker volumes. Even with operational improvements, modest bottom-line conversion constrains retained earnings available for strategic investment and leaves returns more exposed to margin compression.

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

Strong income statement (revenue up 7.23%, healthy 22.8% gross margin, improved profitability) and solid balance sheet (low debt-to-equity of 0.21, 59.11% equity ratio). Cash flow improved to positive free cash flow (651.97M yen) with OCF/net income at 1.05, but historical volatility tempers the score.

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: Positive
• RSI: Neutral
• STOCH: Neutral

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 1923.85, below the 50-day MA of 1793.52, and below the 200-day MA of 1516.54, indicating a bullish trend. The MACD of 70.06 indicates Positive momentum. The RSI at 60.95 is Neutral, neither overbought nor oversold. The STOCH value of 40.86 is Neutral, 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
6492	82 Outperform	¥21.75B	7.97	―	0.72%	6.51%	3.68%
6402	79 Outperform	¥11.08B	6.38	―	2.15%	-0.94%	6.93%
6381	75 Outperform	¥66.86B	13.24	―	3.95%	-1.67%	-4.39%
6363	70 Outperform	¥71.38B	4.09	―	3.09%	6.35%	-34.20%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6393	60 Neutral	¥13.07B	10.99	―	6.70%	7.96%	43.37%
6495	52 Neutral	¥12.43B	42.22	―	1.65%	3.96%	―