ENVALITH
石原産業株式会社 logo

ISHIHARA SANGYO KAISHA,LTD.

4028・Prime Market・Chemicals

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石原産業株式会社 logo
ISHIHARA SANGYO KAISHA,LTD.4028

Business

Ishihara Sangyo Kaisha, Ltd., founded in 1920, is a diversified chemical manufacturer built on two core pillars: the Organic Chemicals Business, centered on Agrochemicals (Herbicides, Insecticides, Fungicides), veterinary pharmaceuticals, and pharmaceuticals; and the Inorganic Chemicals Business, centered on Titanium Dioxide, functional colorants, electronic materials, and fine chemicals. The Group comprises the Company together with 34 subsidiaries and 5 affiliated companies, supplying products to markets worldwide, including Europe, the Americas, and Asia. Its major customers span a wide range, including agricultural producers, agrochemical distributors, electronic component manufacturers, and cosmetics manufacturers, and it operates a manufacturing and sales network domestically and overseas, with the Yokkaichi Plant (Mie Prefecture) as its main production base.

Business Model

In the Organic Chemicals Business, agrochemicals and veterinary pharmaceuticals created at the company's own central research laboratory are registered in countries around the world and formulated and sold through regional subsidiaries in Europe, the Americas, and Asia (such as ISK BIOSCIENCES EUROPE N.V.). In the Inorganic Chemicals Business, functional colorants, electronic materials, and fine chemicals are manufactured based on titanium dioxide technology and sold directly or indirectly to electronic component, cosmetics, and paint manufacturers both domestically and internationally. With continued investment of ¥11,245 million in R&D expenses (FY2026, ending March 2026), this is a research and development-driven business model that continues to renew earnings through the commercialization of new agrochemicals and new functional materials.

Company Strengths

The Organic Chemicals Business achieved net sales of ¥82,619 million and an operating margin of 22.2% in FY2026 (ending March 2026). The company has established specialized sales subsidiaries in Europe, the Americas, and Asia, and has registered and launched growth-strategy agents such as the herbicide tolpyralate, insecticide cyclaniliprole, and fungicide isofetamid in multiple regions. The global rollout of proprietary in-house developed products has enabled the company to maintain a high profit margin.

In the Inorganic Chemicals Business, leveraging its long-standing titanium dioxide manufacturing technology, the company has developed high value-added products such as high-purity titanium dioxide for MLCCs, the bismuth sulfide black pigment "LUSHADE® BLACK," and fine copper particles. In September 2023, it established MF Material Co., Ltd., a joint venture with Murata Manufacturing, strengthening its business foundation in the electronic materials field.

R&D expenses for FY2026 (ending March 2026) totaled ¥11,245 million (¥10,062 million for the Organic Chemicals Business and ¥997 million for the Inorganic Chemicals Business). The company maintains a diverse pipeline, including the creation of new agrochemicals using cutting-edge methods such as AI-driven drug discovery, expansion of indications for the veterinary pharmaceutical PANOQUELL®, and development of biological products, driving continuous commercialization of new products.

ENVALITH's Perspective

Operating profit for FY2026 (ending March 2026) improved substantially to ¥19,077 million (up 82.0% year on year), but this was largely driven by special demand for fungicides in Europe due to weather factors. The company itself has explicitly stated in its FY2027 (ending March 2027) forecast that revenue will decline due to the falloff of the prior period's special demand, and the operating profit forecast for the next fiscal year is expected to decelerate sharply to ¥14,200 million (down 25.6% year on year). In assessing the underlying strength of the agrochemicals business, key points to watch will be the resilience of European sales after the falloff of special demand and the degree of penetration of growth-strategy agents.

On April 19, 2026, a fire broke out at the Kobe plant of consolidated subsidiary Fuji Titanium Industry, damaging exhaust gas equipment and halting operations. The amount of the loss is currently difficult to reasonably estimate and has not been incorporated into the earnings forecast for FY2027 (ending March 2027). In addition to structural headwinds facing the Inorganic Chemicals Business—such as sluggish market conditions for fine chemicals and deteriorating titanium dioxide market conditions due to the influx of Chinese products—this sudden operational risk has also emerged, and it warrants close attention as a factor that could cause the earnings forecast to be revised downward.

Due to a delay in obtaining full approval for the veterinary pharmaceutical PANOQUELL® in the United States, research and development expenses are expected to increase in FY2027 (ending March 2027). The Healthcare Business is an important growth pillar for diversifying the earnings base of the Organic Chemicals Business, but as long as uncertainty over the approval schedule continues, the situation of costs preceding revenue will persist. On the other hand, if expanded sales in the U.S. market following approval and rollout to major countries worldwide are realized, this has the potential to further strengthen the earnings base of the Organic Chemicals Business.

Growth Strategy

Advancing global agrochemical expansion, structural reform of the Inorganic Chemicals Business, and ROIC-focused management under Vision 2030 Stage II

Continuing to obtain and maintain agrochemical registrations in Europe, the Americas, and Asia, while accelerating market development of growth strategy products (herbicides, etc.). In FY2026 (ending March 2026), herbicides in the Americas, fungicides in Europe, and insecticides in Asia each grew, achieving Organic Chemicals Business net sales of ¥82,619 million (up ¥8.2619 billion year on year). Joint development of new agrochemical products with other companies is also being pursued.

Aiming for expanded sales following full approval in the US and rollout to major countries worldwide. At present, full approval is delayed, and R&D expenses are expected to increase. Once approval is obtained, this has significant potential to contribute to revenue diversification within the Organic Chemicals Business.

Shifting the portfolio from general-purpose Titanium Dioxide toward higher value-added products such as electronic component materials and functional colorants. In FY2026 (ending March 2026), domestic sales of electronic materials grew significantly, achieving Inorganic Chemicals Business segment profit of ¥4,972 million (up ¥3.3 billion year on year). However, the fire accident at Fuji Titanium Industry's Kobe Plant (April 2026) remains an operational risk.

The medium-term management plan "Vision 2030 Stage II" positions ROIC-focused management as a key priority to improve capital efficiency. In FY2026 (ending March 2026), ROE reached 13.7%, exceeding the target of 10% or more. An annual dividend of ¥120 (up ¥35 year on year) was implemented, with ¥130 planned for the next fiscal year. The policy of a DOE floor of 3% and a dividend payout ratio target of 40% continues.

Last updated: July 19, 2026