Isamu Paint Co., Ltd.

Business Details

The core segment accounting for over 90% of the Group's consolidated net sales. Centered on Automotive Refinish Paint, the business extends into industrial, architectural, and aerosol fields. The Company manufactures and sells various paints and thinners, while subsidiaries handle aerosol product manufacturing (Isamu Aerosol Kogyo), tube filling (Meiyu Shikisai), and procurement and sales of paint-related products (Shinyu Shoji), forming a vertically integrated business structure. Domestic demand for Automotive Refinish Paint, the mainstay market, has been on a stagnant trend, and the shift toward environmentally friendly, high-performance paints along with development of new markets are challenges.

Recent Overview

Operating profit improved substantially, up 49.1% year on year, driven by the effect of price revisions and a response to advance-buying demand at fiscal year-end

In FY2026 (ending March 2026), Paint Business net sales were ¥8,300 million (up 3.0% year on year), and operating profit was ¥869 million (up 49.1% year on year). Profitability improved due to the effect of price revisions, and advance-buying demand arose at fiscal year-end for some products, including thinners, due to concerns over the situation in the Middle East, resulting in a sales-boosting effect. The Company focused on expanding sales of environmentally friendly, high-performance products across the automotive refinish, large vehicle, architectural, industrial, and aerosol fields. Note that the earnings forecast for FY2027 (ending March 2027) remains undetermined at this time due to the impact of the situation in the Middle East, and there are concerns about a pullback effect from the advance-buying demand that began in March 2026.

Key Products

Growth Drivers

• Improved profitability from the effect of price revisions (operating margin of 10.5% in FY2026, ending March 2026, a substantial improvement from 7.2% in the prior period)
• Acquisition of new users through expanded sales channels for environmentally friendly, high-performance paints (water-based paints "CRONOS HD" and "Aquas DRY," and low-solvent paints)
• Diversification of the sales base through development of new markets, including the large vehicle field ("Wood Protect," "Hi-Art CB Eco") and the industrial field
• Customer retention and proposals for improved work efficiency through software-side enhancements such as the Color Measuring Device "Saisentan Smart"
• Absorption of costs and securing of profits through greater production and operational efficiency

Risks

• Risk of a decline in net sales in FY2027 (ending March 2027) due to a pullback from advance-buying demand at the end of FY2026 (ending March 2026) (a concern expressed by the Company itself)
• Risk of supply instability and price fluctuations in crude oil and raw materials due to the situation in the Middle East (the main reason the FY2027, ending March 2027, earnings forecast remains undetermined)
• Trend of a shrinking domestic market for Automotive Refinish Paint (decline in repair demand due to the spread of collision safety systems and progress of automated driving)
• Risk of crude oil and naphtha price fluctuations due to high dependence on petroleum-related raw materials
• Pressure on profitability from rising logistics costs (further manifestation of the "2024 problem")
• Costs of complying with environmental regulations related to lower-solvent and water-based paints (Air Pollution Control Act, PRTR Act, etc.)