Sankyo Kasei Corporation (8138) AI Stock Analysis

• Market Cap: ¥3.87B
• Dividend Yield: 2.24%
• Average Volume (3M): 1.07K
• Price to Earnings (P/E): 8.1
• Beta (1Y): 0.32
• 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: ¥5,582.00 ▲(32.90% 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

Strong balance sheet and low leverage

Low leverage and a strong equity ratio provide durable financial stability, reducing refinancing risk and preserving strategic optionality. Improved ROE indicates capital is being used more effectively, supporting capacity to fund targeted investments or weather sector cyclicality without compromising solvency.

Improving margins and operational efficiency

Sustained margin expansion signals better pricing power and cost control, creating durable earnings quality. Higher operating margins improve the company's ability to convert sales into profit, enabling reinvestment in R&D or capacity and cushioning results against input-cost shocks over the medium term.

Notable profit and EPS growth

A large EPS improvement reflects meaningful profitability gains and operational leverage, which can translate into stronger internal capital generation if sustained. Structural profit growth supports reinvestment, potential dividend stability, and the ability to pursue strategic initiatives over the next several quarters.

Negative Factors

Negative and volatile cash flow generation

Persistent negative free cash flow and volatile operating cash flow constrain the firm's ability to fund capex, R&D and working capital from internal sources. Over 2-6 months this limits strategic flexibility and increases reliance on external financing, raising long-term funding risk.

Modest revenue growth rate

Revenue growth near 4% is modest for a specialty chemicals player and may be insufficient to drive meaningful scale or offset cost inflation. Without accelerating top-line expansion, margin gains and profit improvements may be harder to sustain, restricting long-term competitive progress.

Small organizational scale

A small headcount suggests limited production, R&D and commercial scale versus larger specialty-chemicals competitors. This can constrain capacity to pursue large contracts, slow new product development, and reduce bargaining power with suppliers and customers, affecting sustainable growth prospects.

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: Neutral
• Last Price: 4200.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:8138, the sentiment is Neutral. The current price of 4200 is below the 20-day moving average (MA) of 4786.75, below the 50-day MA of 4633.50, and above the 200-day MA of 4081.30, indicating a neutral trend. The MACD of 8.95 indicates Positive momentum. The RSI at 37.58 is Neutral, neither overbought nor oversold. The STOCH value of 3.33 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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	¥4.45B	12.52	―	2.27%	1.79%	31.63%
8138	79 Outperform	¥3.87B	8.10	―	2.24%	4.29%	240.24%
4120	71 Outperform	¥3.20B	-26.28	―	3.15%	1.14%	50.47%
7446	65 Neutral	¥3.87B	4.41	―	3.29%	7.11%	80.59%
4242	64 Neutral	¥5.44B	2.32	―	2.67%	-10.04%	-331.24%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
5103	52 Neutral	¥3.19B	-7.78	―	―	-3.45%	56.08%