NIPPON SHOKUBAI CO., LTD.
4114・Prime Market・Chemicals
Business
Nippon Shokubai Co., Ltd. is a chemical manufacturer founded in 1941 and listed on the Tokyo Stock Exchange Prime Market, forming a group that includes 28 subsidiaries and 16 affiliated companies. Its business consists of two segments: the "Materials Business" and the "Solutions Business." The Materials Business manufactures and sells Acrylic Acid, Superabsorbent Polymer (SAP), Ethylene Oxide & Ethylene Glycol, and other products at global sites in the United States, Belgium, Indonesia, China, Singapore, and elsewhere. The Solutions Business handles high-performance chemical products such as polymers for concrete admixtures, Electronic & Information Materials / Battery Materials, Iodine Compounds & Pharmaceutical Intermediates, battery materials, and denitration catalysts. Its major customers span industrial applications in the hygiene materials, construction, electronics, automotive, and energy fields.
Business Model
The company develops core manufacturing technologies for acrylic acid and other products in-house, building a global production network by licensing technology rights to domestic and overseas consolidated subsidiaries. It generates revenue by procuring raw materials (naphtha, propylene, etc.) and manufacturing and selling Acrylic Acid, Superabsorbent Polymer (SAP), Ethylene Oxide & Ethylene Glycol, and other products. In the Solutions Business, the company pursues spread (the difference between raw material costs and selling prices) expansion in high-performance products such as Electronic & Information Materials / Battery Materials, aiming to improve profitability. The company invests ¥16,820 million annually in R&D, continuously promoting the commercialization of next-generation products.
Company Strengths
The company manufactures superabsorbent polymers at four sites in the US, Belgium, Indonesia, and China, with a vertically integrated system in which the raw material acrylic acid is also supplied by its own group. In the fiscal year under review, sales volume of superabsorbent polymers increased, securing revenue growth even amid a phase of price decline. The utilization of intellectual property through technology licensing agreements also supports the earnings base.
Group-wide R&D staff reached approximately 870 (about 20% of total employees), and R&D expenses for the fiscal year under review were ¥16,820 million. The company is concentrating research resources on next-generation fields such as battery materials, nucleic acid pharmaceuticals, hydrogen catalysts, and bio-based acrylic acid, and has secured multiple NEDO-adopted projects.
Building on its acrylic acid manufacturing technology, the company has a broad technology licensing network, granting technology licenses to companies in seven or more countries including the US, Germany, Singapore, Indonesia, South Korea, Belgium, and China. It diversifies its product lineup across the two businesses of Materials and Solutions, dispersing dependence on any specific product.
ENVALITH's Perspective
Performance Trend
In FY2026 (ending March 2026), revenue was ¥399,898 million (down 2.3% year on year), operating profit was ¥17,530 million (down 8.0%), and profit attributable to owners of parent was ¥16,764 million (down 3.6%). Although sales volume increased for some products, declining selling prices driven by falling overseas market conditions and raw material prices for products were the cause of the revenue decline. On the profit side, a shift from inventory valuation gains to losses, combined with increased manufacturing fixed costs and higher SG&A expenses, led to a decline in profit. Equity in earnings of affiliates also fell sharply, from ¥4,015 million to ¥1,202 million. The operating margin remained at 4.4%, well below the roughly 7.9% level seen in FY2022, and recovering to peak profit levels will require both an improvement in market conditions and a transformation of the business portfolio. On the other hand, operating cash flow increased year on year to ¥53,544 million, indicating that cash-generating capacity has been maintained.
Growth Strategy
Concentrating resources on the Solutions Business and making aggressive investments in growth areas such as battery materials
The New Medium-Term Management Plan positions profit expansion in the Solutions Business as the top-priority strategy. In FY2026 (ending March 2026), operating profit recovered sharply, up 27.1% year on year to ¥6,503 million, driven by increased volumes of Electronic & Information Materials / Battery Materials and denitration catalysts, the launch of new polymers, and higher prices for Iodine Compounds & Pharmaceutical Intermediates. The consolidation of e-TEC also contributed to an expansion in business scale.
Manufacturing facilities for lithium-ion battery electrolytes are under construction as part of the expansion of the battery materials business. This is one of the main factors behind the ¥49,013 million in acquisitions of property, plant and equipment (a significant increase year on year) recorded in investing cash flow for FY2026 (ending March 2026). Increases in property, plant and equipment and intangible assets in the Solutions Business reached ¥26,373 million, indicating that growth investments are now in full swing.
The company is working to strengthen profitability through increased sales volumes of Superabsorbent Polymer (SAP) (via expanded production at global sites) and reductions in fixed manufacturing costs. In FY2026 (ending March 2026), although Superabsorbent Polymer (SAP) revenue increased, operating profit declined 20.7% year on year due to higher fixed manufacturing costs and narrower spreads. Maintaining and expanding volumes and spreads remains an ongoing challenge.
Based on the change to the shareholder return policy announced in May 2024, dividends are set with reference to whichever is larger of a payout ratio of 100% or a DOE of 2.0%. In FY2026 (ending March 2026), the company paid an annual dividend of ¥113 per share (payout ratio of 100.8%) and conducted share buybacks of ¥7.0 billion (3,807,800 shares), achieving a total shareholder return ratio of 141.6%.
Last updated: July 19, 2026