ENVALITH
四国化成ホールディングス株式会社 logo

SHIKOKU KASEI HOLDINGS CORPORATION

4099・Prime Market・Chemicals

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四国化成ホールディングス株式会社 logo
SHIKOKU KASEI HOLDINGS CORPORATION4099

Business

Shikoku Chemicals Holdings is a holding company (transitioned to holding structure in January 2023) founded in 1947 and headquartered in Marugame City, Kagawa Prefecture. Comprising 22 subsidiaries and 1 affiliate, the company's core operations center on the Chemicals Business (approximately 73% of net sales), which handles research and development, production, and sales of industrial chemicals and pharmaceuticals, and the Building Materials Business (approximately 25%), which offers housing, landscaping, and storefront-related products. The Chemicals Business consists of three domains—Inorganic, Organic, and Fine Chemical—supplying materials across a broad range of industries, from electronic chemical materials for AI and semiconductor applications to disinfectants and raw materials for tires. The Building Materials Business offers Exterior Products (gates, fences, and garages) and Wall Materials, providing products to the domestic housing and landscaping markets. The overseas sales ratio reached 37.8% (FY2025 (ended March 2025)), with global bases in the United States, China, India, Thailand, and other locations.

Business Model

In the Chemicals Business, the company manufactures high-performance products such as GliCAP (Adhesion Improvement Process), imidazoles, and semiconductor process materials based on proprietary technologies (organic synthesis, low-metal control technology, etc.) developed at its in-house R&D center, and sells them to customers in the electronics, semiconductor, tire, and hygiene sectors. In the Building Materials Business, Exterior Products and Wall Materials produced at the company's own factories are supplied to the residential and non-residential markets via sales subsidiaries. The Chemicals Business maintains a highly profitable structure with a segment profit margin of 19.6%, and expansion in the Fine Chemical Products area is driving overall revenue.

Company Strengths

Fine Chemical Products sales for FY2025 expanded sharply to ¥18,546 million (143.5% year on year). Strong sales of GliCAP for server substrates, new orders for imidazole compounds, and expanding demand for semiconductor process materials combined to drive the Chemicals Business segment profit margin to 19.6% (segment profit of ¥10,103 million).

The equity ratio at the end of FY2025 improved to 65.0% (up from 61.4% in the previous fiscal year), with net assets of ¥94,599 million. Interest-bearing debt was reduced to ¥24,363 million (down ¥6,201 million year on year). The company holds cash and cash equivalents of ¥35,484 million, providing financial flexibility to fund large-scale capital investments from internal resources.

Starting from carbon disulfide production in 1947, the company has expanded its business domains into Inorganic Chemical Products, Organic Chemical Products, Fine Chemical Products, and Building Materials. Centered on its R&D Center (Utazu-cho), it invested ¥2,107 million in R&D expenses in FY2025, and is advancing development of new materials such as metal sulfides for next-generation batteries and the heat-resistant resin benzoxazine.

ENVALITH's Perspective

For the first quarter of FY2026 (ending December 2026), net sales reached ¥19,868 million (up 18.2% year on year), operating profit was ¥4,240 million (up 39.6%), and profit attributable to owners of parent was ¥3,041 million (up 58.0%), all setting record highs for a first quarter. The main driver was Fine Chemical Products, as the company's proprietary product lineup successfully captured the external tailwind of expanding AI and semiconductor-related investment, resulting in a sharp acceleration in both sales and profit growth rates. The full-year forecast has been revised upward to net sales of ¥88,000 million (up 24.5% year on year) and operating profit of ¥14,400 million (up 32.5%), with first-quarter progress rates standing at a high level of 22.6% for net sales and 29.4% for operating profit.

PT Timuraya Tunggal (Basic Chemicals & Agricultural Chemicals), whose acquisition closed in February 2026, had a deemed acquisition date of March 31, 2026, and therefore made zero contribution to the profit and loss statement for the first quarter under review. Its earnings contribution will first appear from the second quarter onward. Against an acquisition cost of ¥4,684 million, provisional goodwill of ¥2,059 million has been recorded, and the goodwill amortization period will be determined once the purchase price allocation (PPA) is finalized. While Chemicals Business segment assets increased by ¥7,461 million, advisory fees and other costs of ¥640 million have already been expensed. The finalized content of the PPA and the scale of this company's revenue contribution will be key evaluation points going forward.

The Building Materials Business segment profit margin for the first quarter of FY2026 (ending December 2026) stood at 7.2% (¥359 million / ¥4,997 million), significantly lower than the Chemicals Business's 25.7%. Amid a continuing declining trend in new housing starts, soaring prices of raw materials including aluminum ingots and rising logistics costs are squeezing profits. Although price revisions and expanded sales in the non-residential segment and new areas achieved a profit increase of 31.0% year on year, the absolute level remains low, and improvement in overall company profit margins continues to depend on the high profitability of the Chemicals Business. Risks of raw material procurement difficulties and price surges due to escalating tensions in the Middle East have not been factored into the earnings forecast, and should be noted as a potential downside factor.

Growth Strategy

Under "Challenge 1000," the company is accelerating the expansion of Fine Chemical Products, M&A activity, and global expansion.

Overseas sales of GliCAP (Adhesion Improvement Process) for server substrates are surging, demand for semiconductor process materials is expanding, and new overseas projects for imidazole compounds are being secured. In the first quarter of FY2026 (ending December 2026), Fine Chemical Products sales reached ¥6,238 million, up 56.5% year on year, functioning as a growth engine for the Chemicals Business.

PT Timuraya Tunggal (Basic Chemicals & Agricultural Chemicals), an Indonesian chemical manufacturer producing and selling sulfur-based basic chemicals and agricultural chemicals, was made a wholly owned subsidiary in February 2026. The aim is to secure stable procurement of raw materials for the company's products and leverage the sales networks of Southeast Asia and other regions, positioning it as a global hub for the Chemicals Business. Profit and loss contribution is set to begin from the second quarter onward. Acquisition cost was ¥4,684 million, with provisional goodwill of ¥2,059 million (PPA not yet finalized).

The new plant at the Marugame Plant, completed in January 2025, has achieved differentiation through high-quality insoluble sulfur products—a raw material used in radial tires—and expanded production capacity. Sales have been trending favorably, particularly in overseas markets, with Inorganic Chemical Products (Insoluble Sulfur, Carbon Disulfide, Anhydrous Sodium Sulfate) sales in Q1 FY2026 (ending December 2026) reaching ¥3,918 million (+1.8% year on year), showing stable performance.

Amid the continuing decline in new housing starts, the company is promoting profitability improvement measures, including sales expansion into non-residential and new business areas and price revisions. The rollout of value-added products under the new brand "MEGLIO," launched in February 2025, is also underway. Segment profit in Q1 FY2026 (ending December 2026) improved to ¥359 million (+31.0% year on year), though the profit margin remains low at 7.2%.

Overseas sales reached ¥7,875 million in Q1 FY2026 (ending December 2026), accounting for 39.6% of consolidated net sales, up from 34.2% in the same period of the previous year. Sales to Asia surged to ¥4,201 million (+70.5% year on year), and further expansion is expected going forward, boosted by the consolidation effect of PT Timuraya Tunggal. Key assumed exchange rates are ¥150/US dollar and ¥175/euro.

Last updated: July 17, 2026