Sankyo Kasei Corporation (8138) AI Stock Analysis

• Market Cap: ¥4.37B
• Dividend Yield: 2.24%
• Average Volume (3M): 1.07K
• Price to Earnings (P/E): 5.1
• Beta (1Y): 0.27
• Revenue Growth: 4.29%
• EPS Growth: 240.24%
• Country: JP
• Employees: 135
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 137.60
• Shares Outstanding: 1,145,500
• 10 Day Avg. Volume: 420
• 30 Day Avg. Volume: 1,070
• PEG Ratio: 0.07
• Price to Book (P/B): 0.49
• Price to Sales (P/S): 0.16
• P/FCF Ratio: -6.31
• 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: ¥5,588.00 ▲(33.05% Upside)
• Action: Reiterated Date: 09/25/25
• Date: Action: Reiterated 09/25/25

Sankyo Kasei Corporation's stock is supported by strong financial performance and technical indicators, with a particularly attractive valuation due to its low P/E ratio. However, challenges in cash flow management need to be addressed to ensure long-term growth.

Positive Factors

Improving margins & revenue growth

Sustained revenue increases alongside rising gross and net margins point to durable operational improvements and pricing power in its specialty chemicals niche. Higher margins support reinvestment, buffer against raw material swings, and underpin longer-term cash generation if converted into stable operating cash flow.

Conservative balance sheet and low leverage

A strong equity base and low debt provide financial flexibility to fund capex, weather cyclical downturns, and pursue selective M&A without stressing liquidity. Improving ROE signals management is extracting better returns from equity, supporting the company’s capacity to invest in growth while limiting refinancing risk.

Significant EPS improvement

A large increase in EPS indicates meaningful earnings leverage from recent operational gains and margin expansion. If driven by sustainable margin improvement rather than one-offs, strong EPS growth strengthens internal funding for R&D and capex, enhancing long-term competitiveness and shareholder optionality.

Negative Factors

Volatile operating cash flow and negative FCF

Persistent negative free cash flow and volatile OCF weaken the company’s ability to self-fund growth, pay dividends, or build cash buffers. Over a multi-month horizon this can force reliance on external financing, constrain capital allocation, and reduce resilience to raw-material or demand shocks, limiting strategic options.

Small organizational scale

A relatively small workforce suggests limited internal capacity for large-scale production, sales expansion, and R&D in specialty chemicals. This structural scale constraint can hinder the company’s ability to pursue broader geographic expansion, scale commercial operations, or rapidly absorb larger contracts versus bigger peers.

Limited forward visibility from management

Absence of formal guidance and limited earnings-call disclosures reduce visibility into management’s near-term strategy and capital allocation plans. Over a 2–6 month horizon, lack of forward metrics makes it harder to assess whether margin and cash-flow improvements will persist and complicates stakeholder planning.

Sankyo Kasei Corporation Business Overview & Revenue Model

Company Description

Sankyo Kasei Corporation (8138) is a leading Japanese chemical manufacturer specializing in the production of synthetic resins, fine chemicals, and functional materials. Established in 1947, the company operates primarily in the sectors of industrial chemicals, plastic products, and advanced materials. Its core offerings include adhesives, coatings, and specialty chemicals that serve a wide range of industries such as automotive, electronics, and construction.

How the Company Makes Money

Sankyo Kasei Corporation generates revenue through the sale of its diverse range of chemical products and materials. Key revenue streams include the supply of industrial adhesives and coatings, which are essential in various manufacturing processes. The company also benefits from its partnerships with major manufacturers in the automotive and electronics sectors, providing tailored chemical solutions that meet specific customer needs. Additionally, the firm engages in research and development to create innovative products, allowing it to maintain a competitive edge and expand its market share. The demand for high-performance materials in emerging technologies, such as electric vehicles and renewable energy applications, further contributes to its earnings.

Sankyo Kasei Corporation Financial Statement Overview

Summary

Sankyo Kasei Corporation shows strong revenue and profit growth with a stable balance sheet. However, cash flow management is a concern due to volatility and negative free cash flow, which could impact future investments.

Income Statement

Sankyo Kasei Corporation has demonstrated consistent revenue growth, with a notable increase from 2024 to 2025. The company maintains a solid Gross Profit Margin and has improved its Net Profit Margin significantly over the years, indicating better cost management and pricing strategies. EBIT and EBITDA margins have also shown improvement, reflecting operational efficiency gains.

Balance Sheet

The balance sheet shows a healthy equity position with a strong Equity Ratio, suggesting financial stability. The company has managed to keep its Debt-to-Equity Ratio low, minimizing financial risk. Return on Equity has improved over time, indicating effective use of shareholder funds, although there is still room for improvement.

Cash Flow

Operating Cash Flow has been volatile, with a negative figure in 2025, posing a risk to liquidity. However, the Free Cash Flow remains negative, which may affect future investments and financial flexibility. The company needs to focus on improving its cash flow generation to support growth and operational needs.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	27.56B	27.12B	26.23B	26.74B	24.24B	21.61B
Gross Profit	2.64B	2.57B	2.46B	2.40B	2.14B	2.03B
EBITDA	1.54B	1.05B	552.50M	597.96M	394.66M	352.90M
Net Income	946.84M	629.35M	346.67M	303.74M	62.53M	76.39M
Balance Sheet
Total Assets	14.87B	16.18B	17.87B	16.40B	15.67B	15.47B
Cash, Cash Equivalents and Short-Term Investments	1.14B	1.57B	2.46B	1.68B	1.19B	1.69B
Total Debt	0.00	720.00M	10.76M	225.57M	142.47M	103.40M
Total Liabilities	6.13B	7.47B	7.71B	7.09B	6.66B	5.97B
Stockholders Equity	8.73B	8.71B	10.16B	9.31B	9.00B	9.49B
Cash Flow
Free Cash Flow	0.00	-676.85M	1.12B	463.74M	-614.86M	762.85M
Operating Cash Flow	0.00	-666.35M	1.19B	607.67M	-502.11M	925.14M
Investing Cash Flow	0.00	846.89M	-206.78M	-151.79M	131.22M	-202.60M
Financing Cash Flow	0.00	-1.22B	-147.11M	-82.48M	-144.31M	-200.07M

Sankyo Kasei Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4200.00
• 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:8138, the sentiment is Positive. The current price of 4200 is below the 20-day moving average (MA) of 4789.75, below the 50-day MA of 4602.00, and above the 200-day MA of 4052.73, indicating a bullish trend. The MACD of 81.77 indicates Positive momentum. The RSI at 64.06 is Neutral, neither overbought nor oversold. The STOCH value of 57.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8138.

Sankyo Kasei Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4625	80 Outperform	¥4.52B	13.73	―	2.27%	1.79%	31.63%
8138	79 Outperform	¥4.37B	5.10	―	2.24%	4.29%	240.24%
4120	71 Outperform	¥3.26B	17.49	―	3.15%	1.14%	50.47%
7446	65 Neutral	¥4.27B	8.09	―	3.29%	7.11%	80.59%
4242	64 Neutral	¥5.59B	-3.53	―	2.67%	-10.04%	-331.24%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
5103	52 Neutral	¥3.34B	-8.50	―	―	-3.45%	56.08%