Sawafuji Electric Co., Ltd. (6901) AI Stock Analysis

• Market Cap: ¥5.57B
• Dividend Yield: 2.46%
• Average Volume (3M): 2.23K
• Price to Earnings (P/E): 8.8
• Beta (1Y): 0.59
• Revenue Growth: -9.28%
• EPS Growth: -219.81%
• Country: JP
• Employees: 881
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Parts
• EPS (TTM): 37.20
• Shares Outstanding: 4,322,000
• 10 Day Avg. Volume: 2,310
• 30 Day Avg. Volume: 2,233
• PEG Ratio: -0.30
• Price to Book (P/B): 0.30
• Price to Sales (P/S): 0.16
• P/FCF Ratio: -2.73
• 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: 54 Neutral
• Price Target: ¥1,317.00 ▲(1.46% Upside)
• Action: Reiterated Date: 10/23/25
• Date: Action: Reiterated 10/23/25

The overall stock score of 54 reflects significant challenges in financial performance, particularly in cash flow and profitability, which are the most impactful factors. Technical analysis shows mixed signals, with some potential for short-term recovery. Valuation concerns due to a negative P/E ratio are partially offset by a decent dividend yield.

Positive Factors

Balanced leverage and equity cushion

A debt-to-equity of 0.38 and equity representing ~50% of assets give Sawafuji a solid capital cushion. This balanced leverage supports solvency and provides capacity to absorb cyclical automotive shocks or fund targeted investments without immediate refinancing pressure over the next several months.

Improving gross margin

A rise in gross margin to 14.66% suggests better cost control or improved product mix in manufacturing alternators/starters. Sustained gross margin improvement supports long-term margin recovery potential and provides room to cover fixed costs, aiding durable profitability resilience.

Stable OEM + aftermarket business model

A dual revenue model selling to OEMs and the aftermarket creates recurring replacement demand and diversified sales channels. This structural exposure to both new-vehicle production and ongoing maintenance helps stabilize revenue through vehicle parc growth and replacement cycles over the medium term.

Negative Factors

Negative operating and free cash flow

Sustained negative operating cash flow and -1,407 million free cash flow materially constrain internal funding for capex, working capital, and dividends. This elevates reliance on external financing and creates liquidity risk that can impair strategic flexibility in the coming months.

Declining revenue trend

A persistent revenue decline indicates weakening top-line momentum, which reduces operating leverage and makes margin recovery harder. Over a 2–6 month horizon this trend limits ability to rebuild profits and increases sensitivity to competitive and cyclical pressures in automotive markets.

Very low net and operating margins

Net margin around 1.05% and weak EBIT/EBITDA margins imply limited profitability buffer. Low structural margins reduce capacity to absorb raw-material or input-cost shocks and constrain reinvestment, making long-term earnings growth and cash generation more uncertain.

Sawafuji Electric Co., Ltd. Business Overview & Revenue Model

Company Description

Sawafuji Electric Co., Ltd. manufactures and sells electronic components for trucks and buses, portable electronic equipment, and portable refrigerators in Japan. The company offers automotive electrical equipment, such as starters, alternators, hybrid (HV) motors, control devices, battery packs, relays, and DC motors. It also provides refrigerators under the ENGEL brand; and gasoline and diesel engine generators and welders under the Elemax brand, as well as generators for use in ships, power plants, and industrial applications. In addition, the company engages in the transportation and freightage businesses. It exports its products to approximately 100 countries worldwide. The company was formerly known as Sawafuji Electric Manufactory and changed its name to Sawafuji Electric Co., Ltd. in 1934. Sawafuji Electric Co., Ltd. was founded in 1908 and is headquartered in Ota, Japan.

How the Company Makes Money

Sawafuji Electric primarily makes money by manufacturing and selling automotive electrical components—most notably alternators and starter motors. Revenue is generated through (1) OEM supply: sales of these components to vehicle manufacturers and major automotive parts suppliers for installation on new vehicles, and (2) aftermarket/repair demand: sales of replacement units and related parts through distribution channels that serve vehicle maintenance and repair. Earnings are driven by production volume, product mix (e.g., unit pricing and specifications by vehicle type), and cost control in manufacturing and procurement. null

Sawafuji Electric Co., Ltd. Financial Statement Overview

Summary

Sawafuji Electric Co., Ltd. faces challenges in revenue growth and profitability, with declining income statement metrics. The balance sheet remains relatively strong with a healthy equity position, but cash flow constraints pose risks to financial stability.

Income Statement

The company has experienced a decline in revenue over recent years. Gross profit margin has slightly improved to 14.66%, but net profit margin decreased to 1.05%, highlighting pressure on profitability. EBIT and EBITDA margins remain low, indicating operational challenges.

Balance Sheet

The balance sheet shows a moderate debt-to-equity ratio of 0.38, suggesting a balanced leverage. Stockholders' equity is stable, representing 50.07% of total assets, providing a solid equity cushion. However, the slight increase in total debt raises caution.

Cash Flow

Cash flow is weak with negative free cash flow of -1407 million and operating cash flow also negative. The operating cash flow to net income ratio is negative due to operating cash flow challenges, indicating potential liquidity issues.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	23.04B	23.60B	26.74B	29.34B	28.76B	26.66B
Gross Profit	3.12B	3.46B	3.84B	3.56B	3.47B	2.74B
EBITDA	625.00M	1.09B	1.49B	1.34B	1.33B	1.23B
Net Income	-105.00M	247.00M	517.00M	285.00M	395.00M	283.00M
Balance Sheet
Total Assets	24.53B	25.12B	26.73B	21.46B	19.70B	19.04B
Cash, Cash Equivalents and Short-Term Investments	869.00M	769.00M	1.58B	1.17B	1.45B	1.16B
Total Debt	4.69B	4.77B	3.80B	3.21B	2.83B	3.10B
Total Liabilities	12.05B	12.34B	13.01B	10.94B	9.58B	9.43B
Stockholders Equity	12.29B	12.58B	13.51B	10.33B	9.95B	9.45B
Cash Flow
Free Cash Flow	0.00	-1.41B	-102.00M	-490.00M	633.00M	-497.00M
Operating Cash Flow	0.00	-268.00M	1.13B	149.00M	1.23B	380.00M
Investing Cash Flow	0.00	-1.33B	-1.22B	-766.00M	-593.00M	-783.00M
Financing Cash Flow	0.00	747.00M	460.00M	261.00M	-382.00M	851.00M

Sawafuji Electric Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1298.00
• 50DMA: Negative
• 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:6901, the sentiment is Positive. The current price of 1298 is above the 20-day moving average (MA) of 1290.90, above the 50-day MA of 1294.72, and above the 200-day MA of 1075.42, indicating a neutral trend. The MACD of 1.45 indicates Positive momentum. The RSI at 58.04 is Neutral, neither overbought nor oversold. The STOCH value of 66.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6901.

Sawafuji Electric Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7244	81 Outperform	¥46.39B	7.97	8.46%	2.64%	-6.35%	18.49%
6995	81 Outperform	¥253.54B	8.29	―	3.36%	1.36%	139.77%
6923	78 Outperform	¥284.51B	8.56	6.37%	2.88%	4.86%	10.95%
7276	76 Outperform	$706.48B	14.05	7.20%	2.41%	-0.73%	88.36%
7280	70 Outperform	¥56.34B	14.59	―	0.99%	-0.83%	-27.20%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
6901	54 Neutral	¥5.57B	8.75	―	2.46%	-9.28%	-219.81%