KIKUSUI CHEMICAL INDUSTRIES CO.,LTD.
7953・Standard Market・Other Products
Business
Kikusui Chemical Industries, founded in 1959, is a specialist manufacturer of architectural finishing materials. In addition to manufacturing and selling Architectural Finishing Materials, substrate adjustment coatings, Tile Adhesive, and Architectural & Civil Engineering Materials, the company provides Building Refresh (Full-Responsibility Construction) (renovation and refurbishment work) as an integrated offering. Its ability to handle everything from substrate preparation to finishing on a one-stop basis is positioned as unique within the industry. Domestically, the company operates multiple plants including in Inuyama, Ibaraki, Fukuoka, Tokai, and Shiga, and has consolidated subsidiaries in Hong Kong, China, and Taiwan. Its major customers span a wide range of industries, including major renovation companies such as Daiwa House Reform, as well as painting, waterproofing, and plastering contractors. With the renovation market as its main battlefield, the company positions solving buildings'
Business Model
In addition to manufacturing and selling products (coating materials), the company adopts a vertically integrated model in which it provides customers with finished coating films through its own construction capabilities under a "Full-Responsibility Construction" approach. By combining revenue from standalone product sales with construction revenue from contracted work orders, the company achieves a higher value-added earnings structure than a simple materials manufacturer. Sales to Daiwa House Reform account for 13.6% of net sales (¥2,936,417 thousand in FY2026 (ending March 2026) actual results), and continuous transactions with major reform companies form the foundation of stable earnings.
Company Strengths
The company's annual securities report explicitly states that it is the only manufacturer in the industry that handles everything from architectural substrate adjustment coating materials to finishing coating materials, Tile Adhesive, and Architectural & Civil Engineering Materials on an integrated basis. This comprehensiveness of the product lineup is a differentiating factor versus competitors, and the ability to respond to customers' diverse construction needs on a one-stop basis contributes to the maintenance of continuous business relationships.
As of the end of March 2026, the company held 42 registered patents and utility model rights, with 34 applications pending. It has accumulated a track record of commercializing proprietary technologies, including the development of architectural finishing coating materials utilizing 'geopolymer' technology—an industry first for architectural finishing materials—and obtaining third-party certification for low-carbon coatings based on a biomass balance approach. Annual R&D expenditure amounts to ¥311,640 thousand.
Sales to Daiwa House Reform increased to ¥2,936,417 thousand (13.6% of net sales) in FY2026 (ending March 2026), up from ¥2,807,689 thousand (13.1%) in the previous fiscal year, indicating an expanding trend in business with major renovation companies. While there is a risk of dependence on a single customer, the continuous relationship with this major client functions as a stable order base.
ENVALITH's Perspective
Performance Trend
Revenue peaked at ¥22,163 million in FY2022 (ended March 2022) and gradually declined to ¥21,391 million in FY2025 (ended March 2025), before recovering slightly to ¥21,602 million in FY2026 (ending March 2026). Operating profit plunged to ¥265 million in FY2025 (ended March 2025) before improving to ¥403 million in FY2026 (ending March 2026). Net income also recovered from ¥166 million to ¥270 million. The sharp profit decline in FY2025 (ended March 2025) appears to reflect a combination of structural and temporary factors, and FY2026 (ending March 2026) is in a rebound phase from that decline. As an external factor, the structure in which raw material cost trends affect profit margins continues, and this warrants close attention alongside demand trends in the renovation market.
Growth Strategy
Aiming for a full-fledged recovery in profitability through deepening penetration of the renovation and infrastructure markets and shifting the product lineup toward higher value-added products
Against the backdrop of social requirements such as environmental measures, energy-saving measures, and countermeasures against spalling, the company captures renovation demand for existing buildings through a six-solution system. The increase in aging stock properties in the market environment is providing a tailwind, and the company aims to expand orders by leveraging its integrated construction provision capabilities.
The company aims to raise product unit prices and improve profit margins by shifting the product lineup from general-purpose products to higher value-added products. The recovery in operating profit for FY2026 (ending March 2026) shows some progress, but continued efforts are needed to fully return to the FY2024 (ended March 2024) level.
The completion of the core system migration has established a framework for improving the accuracy of cost management and optimizing SG&A expenses. This is believed to be contributing to the profit improvement in FY2026 (ending March 2026), and is expected to function as a foundation for future profitability improvement.
Last updated: July 19, 2026