Stock Analysis & Valuation Altech Co., Ltd. (9972.T)

• Previous Close: ¥282.00
• Sector Valuation Confidence Level: Moderate

Valuation method	Value, ¥	Upside, %
Artificial intelligence (AI)	442.22	57
Intrinsic value (DCF)	80.80	-71
Graham-Dodd Method	686.48	143
Graham Formula		n/a

Strategic Investment Analysis

Company Overview

Altech Co., Ltd. (9972.T) is a Tokyo-based industrial machinery company specializing in the manufacturing and distribution of advanced machinery and equipment across multiple sectors. Founded in 1976, Altech provides printing machines, film laminators, converting equipment for plastic and laminate tubes, and synthetic resin processing machinery. The company also offers specialized solutions for industries such as food, pharmaceuticals, cosmetics, and water treatment. Altech stands out with its innovative systems, including ultrasonic sprays, photonic sintering, and thin-film deposition technologies. Additionally, it manufactures PET bottles, preforms, and related packaging solutions, catering to beverage and cooking oil industries. With a strong presence in Japan, Altech combines engineering expertise with logistics and manufacturing support, positioning itself as a versatile industrial solutions provider in the machinery sector.

Investment Summary

Altech Co., Ltd. presents a mixed investment profile. The company operates in a niche industrial machinery market with diversified applications, which could provide stability. However, its recent financials show a net loss of ¥98.8 million and negative diluted EPS (-¥7.18), raising concerns about profitability. Positive aspects include a solid operating cash flow of ¥454.6 million and a healthy cash reserve of ¥4.1 billion, which may support future investments. The company pays a modest dividend (¥7 per share), but high total debt (¥4.67 billion) relative to market cap (¥3.11 billion) is a risk. Investors should weigh Altech’s technological expertise against its financial challenges and sector competition.

Competitive Analysis

Altech Co., Ltd. competes in the industrial machinery sector with a focus on specialized equipment and packaging solutions. Its competitive advantage lies in its diversified product portfolio, serving industries from printing to food and pharmaceuticals. The company’s expertise in PET bottle manufacturing and thin-film technologies provides differentiation, but its financial performance lags behind some peers. Altech’s R&D-driven approach in ultrasonic and photonic systems could foster long-term growth, but its high debt and recent losses weaken its market position. Competitors with stronger balance sheets and global reach may outperform Altech in scalability. The company’s niche focus in Japan limits international exposure, though it benefits from domestic industrial demand. To improve competitiveness, Altech must enhance profitability and reduce leverage while leveraging its technological innovations.

Major Competitors

• Kubota Corporation (6326.T): Kubota is a global leader in agricultural and industrial machinery, with a strong financial position and extensive distribution network. Its diversified machinery portfolio outperforms Altech in scale, but Kubota has less focus on niche technologies like thin-film deposition. Its international presence gives it an edge in growth markets.
• Okuma Corporation (6103.T): Okuma specializes in CNC machine tools and factory automation, competing indirectly with Altech in industrial equipment. Okuma’s strength lies in precision manufacturing solutions, but it lacks Altech’s packaging and PET bottle expertise. Financially, Okuma is more stable, with consistent profitability.
• Amada Co., Ltd. (6113.T): Amada dominates in metalworking machinery, offering advanced cutting and forming solutions. While Amada’s market reach exceeds Altech’s, its product lines are less diversified into non-metal sectors. Amada’s stronger brand and global sales network make it a formidable competitor in industrial machinery.
• SMC Corporation (6273.T): SMC is a leader in pneumatic and automation components, with a broader industrial customer base than Altech. SMC’s global footprint and higher R&D spending give it an advantage, though it does not compete directly in packaging or PET manufacturing. Its financial performance is more robust compared to Altech.