Idemitsu Kosan Co.,Ltd.
5019・Prime Market・Oil & Coal Products
Business
Idemitsu Kosan is a comprehensive energy company founded in 1911, forming a group with 187 subsidiaries and 59 affiliated companies. Centered on Fuel Oil (petroleum refining, sales, and trading), it operates five segments: Basic Chemicals (Olefin and Aromatic Products), High-Performance Materials (lubricants, electronic materials, functional chemicals, and agrochemicals), Power & Renewable Energy, and Resources (crude oil, natural gas, and coal). The company holds domestic refineries, a nationwide SS network, overseas resource interests, and a global lubricants sales network, bearing the social mission of ensuring a stable supply of energy and materials. Revenue for FY2026 (ending March 2026) was ¥8,105,891 million.
Business Model
Built on a vertically integrated model that procures and refines crude oil and sells fuel oil and petrochemical products, the company leverages time-lag effects arising from crude oil price fluctuations as an earnings opportunity. In the High-Performance Materials segment, it secures stable earnings by selling high-value-added products such as lubricants and electronic materials both domestically and overseas. In the Resources segment, it holds interests in Australian coal and overseas oil and gas fields, capturing earnings during periods of rising resource prices. It also uses its nationwide SS network as a customer touchpoint to expand earnings from non-fuel services.
Company Strengths
In addition to refineries in Chiba, Hokkaido, Aichi, and elsewhere, the company expanded its refining capacity by making Fuji Oil Company (voting rights ratio of 92.49%) a consolidated subsidiary in FY2026 (ending March 2026). It has a sales base through a nationwide network of dealers and Service Stations (SS), and the Fuel Oil segment's external customer sales of ¥6,793,416 million demonstrate an overwhelming scale of domestic sales.
In the High-Performance Materials segment, the company possesses proprietary technologies including the expansion of overseas sales of lubricants, the multilayer light-emitting method for OLED materials, and collaboration with Toyota Motor Corporation on solid electrolytes. It invests ¥30.4 billion annually in R&D (FY2026, ending March 2026), continuously strengthening its technological foundation through three overseas R&D bases and industry-academia collaborations with Institute of Science Tokyo and the University of Tokyo.
As of the end of FY2026 (ending March 2026), the equity ratio stood at 36.0% (improved from 30.7% in FY2022, ended March 2022), and the net D/E ratio was maintained at a stable 0.6x, reflecting a sound financial structure. The company has obtained A+ (stable) ratings from both R&I and JCR, and has established a liquidity framework that includes a ¥210 billion commitment line agreement.
ENVALITH's Perspective
Performance Trend
Revenue for FY2026 (ending March 2026) came to ¥8,105,891 million (down 11.8% YoY), primarily due to a decline in crude oil prices (average Dubai crude of $71.8/barrel, down $6.7 YoY). Meanwhile, operating profit rose sharply to ¥212,203 million (up 30.8% YoY), and net income attributable to owners of the parent increased substantially to ¥171,914 million (up 65.2% YoY). The positive time-lag effect in the Fuel Oil segment more than offset the deterioration in coal market conditions (Resources segment profit down 57.2%). Extraordinary gains and losses included a gain on negative goodwill (¥8,428 million) as well as an impairment loss (¥18,095 million), netting to ¥7,510 million negative. Over the past five fiscal years, results have fluctuated significantly with market conditions since the high level seen in FY2022 (operating profit of ¥434,453 million), and FY2026 (ending March 2026) represents a recovery phase.
Growth Strategy
Advancing portfolio transformation through strengthening the profitability of existing businesses and concentrated investment in four priority businesses
In November 2025, Fuji Oil became a consolidated subsidiary (voting rights ratio of 92.49%). The company is advancing the optimization of its petroleum products production system, strengthening cost competitiveness through mutual utilization and unification of both companies' infrastructure, and building a low-carbon energy supply system. Contribution to consolidated results began from FY2026 (ending March 2026) (total assets of ¥349,095 million were incorporated).
The company is cultivating new revenue sources by launching sales and building supply systems for aviation fuel (SAF), biodiesel, and renewable diesel. It aims to capture growing demand driven by tightening decarbonization regulations. Positioned as one of the four priority businesses under the medium-term management plan (FY2026-FY2030).
The company is advancing development of mass production technology for Lithium Solid Electrolyte in collaboration with Toyota Motor Corporation. Against the backdrop of accelerating EV adoption, this is being cultivated as the next-generation earnings pillar of the High-Performance Materials segment. The High-Performance Materials segment recorded profit of ¥33.4 billion in FY2026 (ending March 2026), functioning as a stable earnings base.
Due to the resolution of power plant issues and reduced depreciation expenses following the impairment of biomass facilities, profit/loss for FY2026 (ending March 2026) improved significantly to ¥-1.8 billion (from ¥-12.3 billion in the previous fiscal year). Leveraging the room for expansion in the Solar & Wind Power Generation business, the increase in property, plant and equipment and other assets rose substantially from ¥13,476 million in the previous fiscal year to ¥33,872 million.
The company will begin voluntary adoption of IFRS from the first quarter of FY2027 (ending March 2027), improving the quality of disclosure to global investors. It has announced a policy of achieving stable shareholder returns through a progressive dividend policy with a total payout ratio of 50% or more against net income excluding inventory valuation effects, with an annual dividend floor of ¥36.
Last updated: July 19, 2026