Heiwa Paper Co., Ltd. (9929) AI Stock Analysis

• Market Cap: ¥4.56B
• Dividend Yield: 2.62%
• Average Volume (3M): 1.35K
• Price to Earnings (P/E): 26.8
• Beta (1Y): 0.24
• Revenue Growth: -1.03%
• EPS Growth: -43.05%
• Country: JP
• Employees: 195
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Industrial Materials
• EPS (TTM): 4.39
• Shares Outstanding: 10,116,917
• 10 Day Avg. Volume: 1,330
• 30 Day Avg. Volume: 1,346
• PEG Ratio: -2.54
• Price to Book (P/B): 0.42
• Price to Sales (P/S): 0.26
• P/FCF Ratio: -15.90
• 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: 56 Neutral
• Price Target: ¥522.00 ▲(11.06% Upside)
• Action: Reiterated Date: 10/31/25
• Date: Action: Reiterated 10/31/25

Heiwa Paper Co., Ltd. has a stable financial position with consistent revenue and strong equity, but profitability and cash flow challenges weigh on its financial performance. The technical indicators suggest a neutral to slightly bearish trend, and the high P/E ratio indicates potential overvaluation. The dividend yield offers some compensation for investors.

Positive Factors

Strong balance sheet

A robust equity base and moderate leverage provide durable financial flexibility: supports working-capital financing for distribution, cushions commodity price swings, and enables selective investment or supplier financing without threatening solvency over the next several quarters.

Consistent gross and operating margins

Steady gross margins and resilient EBIT/EBITDA point to operational control over procurement and distribution costs. This underlying margin stability supports long-term profitability even if top-line volumes fluctuate, enabling margin-driven recovery if revenue stabilizes.

Stable distribution business model

A wholesale/distribution role into printing, packaging and industrial users yields recurring B2B demand and customer stickiness; logistics and value-added fulfillment embedded in pricing create structural revenue durability and predictable order flows over months.

Negative Factors

Weak free cash flow

Negative free cash flow and weak conversion from operating cash to FCF reduce the firm's ability to self-fund capex, working-capital needs or payout growth. Over several quarters this constrains strategic flexibility and may force reliance on external financing.

Declining revenue trend

A multi-percent revenue decline indicates modest demand or pricing pressure in core markets. Sustained top-line contraction would erode scale benefits in distribution, pressure margins, and make it harder to cover fixed logistics and service costs over the medium term.

Low return on equity

Low ROE driven by volatile net income signals inconsistent earnings power relative to capital employed. Over 2-6 months this undermines the firm's ability to generate shareholder returns and may limit retained-earnings-funded growth or reinvestment capacity.

Heiwa Paper Co., Ltd. Business Overview & Revenue Model

Company Description

Heiwa Paper Co.,Ltd. engages in paper trading activities in Japan and internationally. The company imports, develops, sells, and exports specialty papers, high-grade papers, industrial papers, and other paper materials. It also provides fancy papers, fine boards, printing papers, and basic papers; and engages in the development and commercialization of paper products. The company was incorporated in 1946 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Heiwa Paper Co., Ltd. generates revenue through the sale of its wide array of paper products, which include offset paper, coated paper, and specialty papers. The company operates on a business-to-business (B2B) revenue model, supplying its products to printing companies, packaging firms, and other manufacturers in need of paper materials. Key revenue streams include bulk orders from large corporate clients, contracts with distributors, and partnerships with various industries that require sustainable paper solutions. Additionally, Heiwa Paper may earn income through value-added services such as custom paper solutions and consulting on paper usage, which enhances customer relationships and drives recurring revenue.

Heiwa Paper Co., Ltd. Financial Statement Overview

Summary

Heiwa Paper Co., Ltd. shows operational stability with consistent revenue and gross profit margins. However, profitability is hindered by low net income and free cash flow challenges. The balance sheet is strong, supporting future growth with a solid equity base. The company should focus on improving net income and free cash flow to enhance overall financial health.

Income Statement

The income statement reveals modest revenue stability with slight fluctuations over the years. The gross profit margin has been consistent, indicating a steady control over cost of goods sold. However, the net profit margin has been under pressure, largely due to volatile net income figures, which is a concern for profitability. EBIT and EBITDA margins have shown resilience, suggesting some operational efficiency.

Balance Sheet

The balance sheet is robust with a healthy equity base. The debt-to-equity ratio is moderate, reflecting balanced leverage usage. The equity ratio indicates strong asset financing through equity. Return on equity is low due to fluctuating net income, which is a point of concern. Overall, the financial position appears stable with manageable debt levels.

Cash Flow

The cash flow statement indicates challenges in generating free cash flow, as evidenced by negative figures in recent years. Operating cash flow has been relatively stable, but the conversion to free cash flow is weak, impacting financial flexibility. The operating cash flow to net income ratio suggests that operating activities are generating reasonable cash relative to earnings, but improvements are needed in capital expenditure management.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	15.99B	16.03B	16.12B	16.07B	15.62B	14.61B
Gross Profit	3.28B	3.11B	3.18B	3.13B	2.82B	2.53B
EBITDA	283.83M	304.78M	272.51M	241.09M	262.90M	114.59M
Net Income	97.92M	117.03M	136.33M	874.80M	87.26M	-34.78M
Balance Sheet
Total Assets	17.77B	18.17B	19.04B	17.78B	15.90B	16.09B
Cash, Cash Equivalents and Short-Term Investments	2.62B	2.67B	2.84B	3.07B	3.32B	3.27B
Total Debt	2.35B	2.45B	2.46B	2.41B	2.15B	2.17B
Total Liabilities	7.89B	8.26B	8.94B	8.37B	7.37B	7.37B
Stockholders Equity	9.87B	9.92B	10.10B	9.41B	8.53B	8.72B
Cash Flow
Free Cash Flow	0.00	-264.78M	96.00M	-1.13B	228.18M	263.31M
Operating Cash Flow	0.00	260.77M	122.83M	121.11M	234.00M	314.25M
Investing Cash Flow	0.00	-554.34M	-13.21M	-408.28M	-13.88M	36.61M
Financing Cash Flow	0.00	-171.47M	-344.65M	43.13M	-123.12M	-85.71M

Heiwa Paper Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 470.00
• 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:9929, the sentiment is Negative. The current price of 470 is below the 20-day moving average (MA) of 480.20, below the 50-day MA of 471.52, and above the 200-day MA of 447.93, indicating a neutral trend. The MACD of -0.10 indicates Positive momentum. The RSI at 45.12 is Neutral, neither overbought nor oversold. The STOCH value of 44.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:9929.

Heiwa Paper Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3945	78 Outperform	¥3.48B	3.80	―	3.33%	1.53%	20.73%
3892	67 Neutral	¥8.32B	8.81	―	3.00%	-2.03%	-23.36%
3895	66 Neutral	¥3.41B	5.54	―	4.43%	-3.73%	-7.14%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
3955	58 Neutral	¥8.86B	10.13	―	3.00%	4.22%	13.08%
9929	56 Neutral	¥4.56B	26.76	―	2.62%	-1.03%	-43.05%
3168	51 Neutral	¥18.09B	4.90	―	3.37%	0.48%	-138.12%