Kinik Company Overview
Kinik is Taiwan's first grinding-wheel maker. Over seven decades it has turned its core skill, abrasive grinding, into a position as a key supplier of consumables to leading semiconductor fabs. Its three businesses are CMP diamond disks (pad conditioners), reclaimed and test silicon wafers, and conventional and super-abrasive grinding tools. Semiconductor customers produced about NT$6.6 billion, or roughly 80%, of FY2025 revenue of NT$8.15 billion. The diamond-disk business is the profit engine. It is the leading supplier of CMP pad conditioners to Taiwan's largest foundry at 3nm and below, with an estimated 70–80% share, and it is expanding into US memory and US IDM customers. Kinik runs a 400,000-wafer-per-month 12-inch reclaim and test wafer operation, one of the largest in Asia. In 2025 it bought Mitsui Kinzoku's grinding-wheel subsidiaries in Japan and Thailand, which made it a three-country abrasives group. It is controlled by its founding family, now in its third generation of leadership, and is investing heavily to meet demand from 2nm, 1.6nm and 1.4nm logic, HBM and advanced packaging.
What the company does. Kinik makes and sells abrasive and precision-grinding products and provides wafer reclaim services. It reports three business units:
DBU (Diamond Business Unit): CMP diamond disks (pad conditioners), which keep polishing pads in condition during chemical-mechanical planarisation. Advanced logic, DRAM, 3D NAND and advanced-packaging fabs use them. DBU also makes related diamond tools.
SBU (Wafer / Silicon Business Unit): reclaim of 12-inch and 8-inch silicon test and monitor wafers. Fabs send used test wafers to Kinik, which strips, grinds, polishes and cleans them for reuse. SBU also supplies test wafers and specialty wafers.
ABU (Abrasive Business Unit) and grinding subsidiaries: conventional vitrified and resin grinding wheels, diamond and CBN super-abrasive wheels, dicing blades, wafer back-grinding wheels, vacuum chucks, precision cutting tools and CVD diamond coatings. The unit includes the Taiwanese subsidiary Hongji Industrial (鴻記工業), Kinik-Thai, and since April 2025 Mitsui Kensaku Toishi (MKS, Japan) and Mitsui Grinding Technology (Thailand) (MGT).
Company self-description. In its investor materials Kinik describes itself as an abrasives and grinding-solutions company founded in 1953 with the business philosophy "Good together" (合好). It notes that semiconductor revenue was about NT$6.6 billion in 2025, or 80% of the total. The chairman states the long-term aim as becoming "an excellent smart-manufacturing and service centre for grinding solutions" and a world-class company. The company sums up its history as going "from grinding stone to grinding semiconductors", with grinding (磨) as its core technology. Its products have won Taiwan's National Quality Award in all three product families. Kinik sells to more than 50 countries and over 8,000 customers.
Revenue model. The business is almost entirely product and service sales. There are no subscription or licensing streams of note.
CMP diamond disks (DBU): Nature: Consumable product, replaced on a usage cycle per CMP tool; Approx. share of FY2025 revenue (%): 31
Reclaim, test and specialty wafers (SBU): Nature: Mainly a processing service per wafer (reclaim), plus product sales (test and specialty wafers); Approx. share of FY2025 revenue (%): 46
Grinding wheels, tools, coatings (ABU and subsidiaries): Nature: Industrial consumables and tooling; Approx. share of FY2025 revenue (%): 23
Value-chain position. Kinik is a Tier-1 consumables and services supplier to wafer fabs. It sits beside CMP slurry, pad and equipment suppliers and is upstream of the device makers. The diamond disk is a qualified, process-of-record consumable. Once a disk is qualified on a node, switching suppliers takes requalification, which makes Kinik's position sticky. Reclaim is a closed-loop service. Fabs send test and dummy wafers out for repeated reuse, which lowers their wafer costs and supports circular-economy goals. The ABU serves machine-tool, automotive, aerospace, ABF-substrate, semiconductor-packaging, quartz, glass and general-engineering customers.
Customer types and end-markets.
Leading-edge logic foundry: Products: DBU, SBU; Key customer types: Taiwan's largest foundry, including its overseas fabs; other foundries
Memory (DRAM, HBM, NAND): Products: DBU, SBU, specialty wafers; Key customer types: US memory maker; Japanese memory makers
IDM: Products: DBU, SBU; Key customer types: US IDM (leading-edge node shipments since Q3 2025; mature nodes sampling)
Advanced packaging (CoWoS, 3D IC, HBM, hybrid bonding): Products: Diamond disks, wafer-grinding wheels under qualification; Key customer types: Foundry and OSAT packaging lines
Machinery, machine tools, automotive: Products: Conventional and super-abrasive wheels; Key customer types: Tool builders, automotive parts makers
ABF substrate, quartz, glass: Products: Grinding wheels, diamond tools; Key customer types: Substrate and materials processors
Independent characterisation. Kinik is often filed as an "electric machinery" stock, but its earnings now behave like a high-value semiconductor-consumables franchise. The diamond-disk business, with gross margins above 50%, carries most of the profit. Its volume grows with three things: the number of CMP steps per wafer, which rises at each node with backside power delivery, gate-all-around transistors and hybrid bonding; wafer starts at the leading foundry; and Kinik's share at that customer. Reclaim adds a steady annuity-like base that tracks fab utilisation. The grinding-wheel business is cyclical and lower margin, but the 2025 acquisitions and a July 2026 price rise of about 15% have made it a meaningful contributor.
Strategy
Strategic themes.
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Grow with the leading-edge roadmap. Kinik wants to keep a 70–80% share of diamond disks at N3, N2/N1.6, A16 and A14 at its largest customer. It has bought the same CMP tools as that customer and develops locally alongside it, which is how it overtook 3M at 3nm.
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Diversify DBU customers abroad. The share target at a US memory maker is now 50%, up from 20–30%. Several products are qualified at a US IDM, and that customer is expected to reach about 7% of DBU revenue by end-2027.
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Move SBU up the value chain. New reclaim capacity, about 70% of it for high-end products, goes to advanced-node customers. Kinik is also raising the share of test and specialty wafers and putting through price increases to cover depreciation.
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Consolidate abrasives globally. The 2025 MKS and MGT acquisitions gave Kinik five wheel plants across Taiwan, Japan and Thailand. The aim is to use Mitsui's Japanese know-how and reach into Southeast Asia, and to share technology across the group.
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Advanced-packaging tools. Kinik is qualifying new wafer-grinding wheels, which could start small-volume supply to a major customer in 2027. It is also developing disks and grinding tools for CoWoS, 3D IC, HBM and hybrid bonding.
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Smart manufacturing and lean operations. Five years of digital transformation and lean production programmes support the aim of becoming a smart-manufacturing and service centre for grinding solutions.
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Sustainability. Kinik targets carbon neutrality by 2050. It has completed GHG inventories at all sites and product carbon footprints for its three main product lines.
Initiatives in the last 24 months
Jun 2024: Initiative: First convertible bond (中砂一); Detail: Funded capacity; redeemed in September 2026 after the share price passed the call trigger
Jan–Apr 2025: Initiative: MKS and MGT acquisitions; Detail: About NT$836 million; consolidated from April 2025
2025: Initiative: SBU expansion; Detail: 12-inch capacity from 300,000 to 330,000 in Q3 2025, then to 400,000 by June 2026
2025–2026: Initiative: DBU expansion; Detail: From about 50,000 at end-2025 to more than 60,000 in mid-2026 and more than 70,000 targeted for end-2026
Jul 2026: Initiative: ABU pricing; Detail: Conventional wheel prices up about 15% to pass through raw-material inflation
Jul 2026: Initiative: CEO succession; Detail: Lee Wei-chang becomes CEO
Aug–Sep 2026: Initiative: Second convertible bond; Detail: Collection and escrow banks appointed 13 August; approved for Taipei Exchange trading 1 September
2026–2027: Initiative: New DBU plant; Detail: Dahu, Yingge; long-term capacity of about 200,000 disks per month
2026–2027: Initiative: New SBU site; Detail: Northern Taiwan site under study
Medium-term targets and guidance.
DBU revenue CAGR, next three years (company, July 2026): Target: 15–20%
DBU capacity, end-2026: Target: More than 70,000 disks per month
DBU capacity, end-2027: Target: 95,000 disks per month
SBU 12-inch capacity, 2027: Target: 430,000 wafers per month
ABU revenue growth, 2026: Target: More than 20%
2026 overall: Target: Revenue, gross profit and net profit all above 2025; H2 2026 above H1
2026 capex: Target: About NT$1.5 billion
Products & Services
DBU – Diamond Business Unit
DBU monthly capacity was 35,000–50,000 disks in 2025, close to 50,000 by end-2025, more than 60,000 from June–July 2026, and about 62,000 in Q3 2026. Targets are more than 70,000 by end-2026, 95,000 by end-2027, and eventually around 200,000 from a planned new plant in Dahu, Yingge.
SBU – Wafer Business Unit
ABU – Abrasive Business Unit and subsidiaries
Earlier disclosures also list moulded optical lens products for phones, cameras, optical receivers, projectors, monitors and medical equipment. They are no longer a separately reported line. Pricing is set by contract per product and is not publicly disclosed.
Product Portfolio
| Product | Description and capabilities | Target customer | Status / latest version |
|---|---|---|---|
CMP diamond disk (pad conditioner), advanced logic | Diamond-grit disk that dresses CMP polishing pads to keep removal rates and uniformity steady; consumption per wafer rises at each new node | Leading foundry (N3, N2/N1.6, A14) | 3nm-and-below share estimated at 70–80%; N2 and 1.6nm revenue up 84% QoQ in Q2 2026 and now comparable to 3nm; 1.4nm (A14) shipments began in 2026 at about 1.2% of DBU sales |
CMP diamond disk for backside power (A16) | Disks for the extra CMP steps that backside power delivery requires | Leading foundry | Backside power is estimated to raise CMP disk usage by 10–20% |
CMP diamond disk, memory | Disks for DRAM, HBM and 3D NAND CMP | US memory maker; Japanese memory makers | Share target at the US memory customer raised from 20–30% to 50% |
CMP diamond disk, IDM | Disks for leading-edge and mature IDM nodes | US IDM | Leading-edge node revenue since Q3 2025; mature-node samples since Q4 2025; expected to reach about 7% of DBU revenue by end-2027 |
Advanced-packaging diamond disks | Disks for CoWoS, 3D IC, HBM and hybrid-bonding planarisation | Foundry and packaging customers | In growth |
Mature-node diamond disks | Disks for 28nm and above and specialty fabs | Taiwanese and overseas fabs | Established |
| Product / service | Description | Target customer | Status |
|---|---|---|---|
12-inch reclaim wafer | Strips, grinds, polishes and cleans used 300mm test and monitor wafers for reuse | Foundries, memory makers, IDMs | Capacity 330,000 per month in 2025, 360,000 in Q2 2026, 400,000 by end-June 2026 and fully loaded; 430,000 targeted for 2027 through debottlenecking |
8-inch reclaim wafer | 200mm reclaim service | Mature-node fabs | Established |
Test wafers | New-material test and monitor wafers; ASP 3–6 times that of reclaim | Foundries, memory | Rising share of SBU revenue |
Specialty wafers | Special-specification wafers, including high-margin wafers for a US memory customer | Memory, IDM | About 5% of revenue in mid-2025 and growing |
Hard and brittle material processing | Processing of next-generation wafers and other hard, brittle semiconductor materials | Semiconductor customers | Ongoing |
| Product | Description | Target customer | Status |
|---|---|---|---|
Conventional vitrified grinding wheels | Ceramic-bonded wheels for precision parts, bearings and gears; Kinik made the world's largest vitrified wheel, 1.55m in diameter, displayed in Yingge | Machine-tool, automotive and bearing makers | Prices up about 15% from July 2026 |
Resin-bonded wheels | Wheels for steel, moulds and general engineering | Industrial users | Established |
Diamond and CBN super-abrasive wheels | Resin, metal, vitrified and electroplated bond systems | Precision parts, carbide tools, aerospace | Established |
Wafer-grinding (back-grinding) wheels | Wheels for wafer thinning | Semiconductor and advanced packaging | New wafer-grinding wheel under qualification; small-volume supply to a major customer's advanced packaging possible from 2027 |
Dicing blades and diamond cutting blades | Cutting for semiconductor packaging, quartz and glass | Packaging houses, materials processors | Established |
Vacuum chucks | Porous-ceramic chucks for semiconductor equipment | Equipment makers and fabs | Established |
CVD diamond coating | Diamond-coated tools and parts | Tooling, semiconductor parts | Gross margin about 25% in Q2 2026 |
PCD tools | Polycrystalline-diamond cutting tools | Machining | Since 1995 |
MKS (Japan) wheel range | Japanese-made precision grinding wheels | Japanese manufacturers | Consolidated since April 2025 |
MGT (Thailand) wheel range | Japanese-quality wheels for transport equipment, aerospace, medical and food machinery | Thai and Southeast Asian manufacturers | Consolidated since April 2025 |
Financial Narrative
All figures are consolidated, Taiwan-IFRS, TWD millions unless noted, for fiscal years ending 31 December. Net income is attributable to owners of the parent. EPS is basic EPS as reported in each year.
6.1 Income statement
6.2 Margins
Revenue grew at a compound annual rate of 7.8% from FY2021 to FY2025.
6.3 Quarterly trend, 2025–2026
Q2 2026 operating margin was 24.2%, up 4.8 points on the quarter and 7.5 points on the year. Net income was up 96.6% year on year. First-half 2026 revenue was NT$4.79 billion (+23.1%), gross margin 37.6%, operating margin 21.9%, net income NT$960 million and EPS NT$6.44. Q1 2026 ROE was 20.7%. Q3 2026 revenue was a record NT$2,694 million, up 8.1% on the quarter and 25.1% on the year. Q3 2026 earnings are due at an investor conference on 10 November 2026.
6.4 Monthly revenue, 2026
Revenue for January–September 2026 totalled NT$7,480 million, up 25.1% year on year. Each month from July to September set a new monthly record.
6.5 Balance sheet (year-end)
Book value per share reached NT$60.6 by mid-2026.
6.6 Cash flow
Kinik has not bought back shares in this period. In the twelve months to June 2026, operating cash flow was NT$2,383 million and capex NT$1,510 million. The 2026 capex budget is about NT$1.5 billion, of which 70–80% goes to DBU capacity and the rest to final payments for the second SBU phase and to equipment.
6.7 Ratios (year-end basis)
6.8 Commentary.
Revenue: Revenue fell 7.6% in FY2023 when the semiconductor inventory correction cut reclaim volumes and machine-tool demand at the same time. It recovered by 10.0% in FY2024 and 16.1% in FY2025. In FY2025, N2 diamond disks, the first US IDM shipments and nine months of MKS and MGT revenue pushed sales above NT$8 billion for the first time. The 2026 run-rate is faster again: nine-month growth was 25.1%, against 16.1% for FY2025. Monthly revenue rose from NT$753 million in January to NT$909 million in September.
Margins: Gross margin is the clearest sign of a change in earnings quality. It peaked at 36.6% in FY2022, including a record 40.1% in Q2 2022 helped by pricing, test-wafer mix and FX gains. It fell to 30.4% in FY2023 as utilisation dropped. It then rose every quarter from Q1 2025 to reach 40.1% in Q2 2026. The drivers were diamond-disk mix (N2, N1.6, A14), full SBU utilisation and lower unit depreciation, specialty wafers, and ABU pricing. Currency is the main swing factor. The new Taiwan dollar's rise took about 3 points off gross margin in Q2 2025 and about 1.8 points in Q3 2025, when the currency strengthened 3.6% against the US dollar quarter on quarter. Operating margin of 24.2% in Q2 2026 is the highest in the period.
Non-operating items: Pre-tax margin has been above operating margin since FY2023. The gap comes from investment income and FX: Q3 2025 had about NT$70 million of FX and valuation gains, and Q2 2026 about NT$60 million of non-operating income, of which about NT$44 million came from investment gains.
Balance sheet: Leverage is low. Total debt to equity has held near 0.3x since FY2022, and net debt was 0.4x EBITDA at end-FY2025. FY2024 cash rose to NT$2.0 billion after the first convertible bond was issued. FY2025 cash fell to NT$1.57 billion after the MKS and MGT purchases (about NT$677 million in cash) and higher capex. Inventory has risen every year, from NT$1.44 billion in FY2021 to NT$2.43 billion in FY2025. Part of the FY2025 rise reflects the acquired subsidiaries, and inventory is worth watching as DBU capacity grows.
Cash flow: Operating cash flow has covered capex and dividends every year. Free cash flow fell to NT$855 million in FY2025 because capex tripled to NT$1.06 billion. Capex of about NT$1.5 billion in 2026 and a planned new DBU plant point to heavier investment through 2027. The second convertible bond, approved for trading on 1 September 2026, adds funding headroom.
Returns: ROE rose from 13.8% in FY2023 to 16.7% in FY2025 and about 19–21% on a trailing basis in mid-2026. That is the highest level since FY2022.
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Segment Overview
| Segment | Contents | Main products / services | Main sites |
|---|---|---|---|
DBU – Diamond Business Unit | CMP diamond disks and related diamond products | Conventional and advanced-node CMP pad conditioners (N3, N2, A16, A14), memory and IDM disks, advanced-packaging disks | Taiwan (Yingge, Shulin and Hukou area) |
SBU – Wafer Business Unit | Reclaim and test wafers | 12-inch and 8-inch reclaim, test wafers, specialty wafers (including for a US memory customer) | Zhubei and Zhunan, Taiwan |
ABU – Abrasive Business Unit and grinding subsidiaries | Conventional and super-abrasive tools | Vitrified and resin wheels, diamond and CBN wheels, dicing blades, wafer-grinding wheels, vacuum chucks, CVD diamond coatings, cutting tools | Yingge, Shulin, Hukou; Hongji (Taiwan); Kinik-Thai and MGT (Thailand); MKS (Japan) |
Revenue by Segment (%)
| Segment | FY2023 | FY2025 |
|---|---|---|
SBU – Wafer (%) | 52 | 46 |
DBU – Diamond (%) | 29 | 31 |
ABU – Abrasive incl. subsidiaries (%) | 20 | 23 |
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View Subscription PlansRevenue by Segment
| Segment | FY2023 | FY2025 |
|---|---|---|
SBU – Wafer (TWD Mn) | 3,318 | 3,749 |
DBU – Diamond (TWD Mn) | 1,850 | 2,526 |
ABU – Abrasive (TWD Mn) | 1,276 | 1,874 |
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View Subscription PlansRevenue by Segment (Quarterly)
| Segment | Q1 2026 | Q2 2026 |
|---|---|---|
DBU – Diamond (TWD Mn) | 717 | 782 |
SBU – Wafer (TWD Mn) | 1,032 | 1,077 |
ABU – Abrasive (TWD Mn) | 544 | 634 |
Total (TWD Mn) | 2,293 | 2,493 |
Segment Overview — DBU
| Segment | Gross-margin indication |
|---|---|
DBU | Above 50%; the highest-margin unit |
SBU | Monthly gross margin near 40% in Q2 2026, close to the group average, helped by full utilisation, lower unit depreciation and high-margin specialty wafers |
ABU | Lower margin; CVD diamond coating recovered to about 25% gross margin in Q2 2026; July 2026 price rise of about 15% |
Income Statement and Margin Analysis (%)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Revenue (TWD Mn) | 6,028 | 6,908 | 6,381 | 7,019 | 8,150 |
Revenue growth (%) | 16.9 | 14.6 | -7.6 | 10.0 | 16.1 |
Gross profit (TWD Mn) | 1,863 | 2,528 | 1,942 | 2,188 | 2,647 |
Operating income (TWD Mn) | 932 | 1,431 | 989 | 1,155 | 1,303 |
EBITDA, operating income plus D&A (TWD Mn) | 1,563 | 2,049 | 1,596 | 1,733 | 1,955 |
Pre-tax income (TWD Mn) | 886 | 1,558 | 1,060 | 1,289 | 1,659 |
Net income to parent (TWD Mn) | 677 | 1,247 | 852 | 1,035 | 1,360 |
Basic EPS (TWD) | 4.78 | 8.71 | 5.91 | 7.10 | 9.28 |
Cash dividend per share for the year (TWD) | 2.80 | 4.00 | 4.00 | 4.00 | 4.94 |
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View Subscription PlansMargin Analysis (%)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Gross margin (%) | 30.9 | 36.6 | 30.4 | 31.2 | 32.5 |
Operating margin (%) | 15.5 | 20.7 | 15.5 | 16.5 | 16.0 |
EBITDA margin (%) | 25.9 | 29.7 | 25.0 | 24.7 | 24.0 |
Pre-tax margin (%) | 14.7 | 22.6 | 16.6 | 18.4 | 20.4 |
Net margin (%) | 11.2 | 18.1 | 13.4 | 14.7 | 16.7 |
Income Statement and Margin Analysis (%) (Quarterly)
| Metric | Q1 2025 | Q2 2025 | Q3 2025 | Q4 2025 | Q1 2026 | Q2 2026 |
|---|---|---|---|---|---|---|
Revenue (TWD Mn) | 1,772 | 2,119 | 2,088 | 2,171 | 2,293 | 2,493 |
Gross margin (%) | 30.9 | 32.1 | 32.4 | 34.2 | 35.0 | 40.1 |
Net income to parent (TWD Mn) | 287 | 266 | 328 | 479 | 437 | 523 |
EPS (TWD) | 1.96 | 1.82 | 2.24 | 3.26 | 2.94 | 3.49 |
Revenue History
| Month | Revenue (TWD Mn) | YoY growth (%) |
|---|---|---|
Jan 2026 | 753 | 33.1 |
Feb 2026 | 751 | 24.4 |
Mar 2026 | 789 | 31.1 |
Apr 2026 | 830 | 18.8 |
May 2026 | 829 | 17.8 |
Jun 2026 | 833 | 16.4 |
Jul 2026 | 886 | 26.6 |
Aug 2026 | 899 | 30.4 |
Sep 2026 | 909 | 30.1 |
Balance Sheet and Per-Share Data
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Total assets (TWD Mn) | 10,162 | 9,545 | 9,863 | 11,051 | 13,258 |
Cash and equivalents (TWD Mn) | 1,920 | 1,130 | 992 | 2,001 | 1,573 |
Short-term debt (TWD Mn) | 700 | 100 | 955 | 61 | 344 |
Long-term debt (TWD Mn) | 2,300 | 1,300 | 1,014 | 1,987 | 1,938 |
Total debt incl. leases (TWD Mn) | 3,850 | 1,945 | 2,015 | 2,102 | 2,395 |
Net debt (TWD Mn) | 1,930 | 815 | 1,023 | 101 | 822 |
Total equity incl. minorities (TWD Mn) | 5,051 | 6,091 | 6,472 | 7,426 | 8,489 |
Equity to parent (TWD Mn) | 4,749 | 5,762 | 6,168 | 7,134 | 8,145 |
Goodwill and intangibles (TWD Mn) | 7 | 7 | 0 | 0 | 0 |
Inventory (TWD Mn) | 1,443 | 1,808 | 1,922 | 2,049 | 2,431 |
Receivables (TWD Mn) | 1,119 | 1,096 | 1,087 | 1,158 | 1,433 |
Current assets (TWD Mn) | 4,511 | 4,062 | 4,042 | 5,237 | 5,482 |
Current liabilities (TWD Mn) | 2,537 | 1,983 | 2,251 | 1,475 | 2,182 |
Working capital (TWD Mn) | 1,975 | 2,078 | 1,791 | 3,762 | 3,300 |
Book value per share (TWD) | 33.29 | 40.09 | 42.56 | 48.88 | 55.30 |
Cash Flow
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Operating cash flow (TWD Mn) | 1,261 | 1,950 | 1,289 | 1,617 | 1,914 |
Capital expenditure (TWD Mn) | 256 | 192 | 532 | 349 | 1,060 |
Free cash flow (TWD Mn) | 1,005 | 1,758 | 757 | 1,269 | 855 |
Depreciation and amortisation (TWD Mn) | 631 | 618 | 607 | 578 | 652 |
Cash paid for acquisitions (TWD Mn) | 0 | 0 | 0 | 8 | 677 |
Dividends paid (TWD Mn) | 396 | 400 | 576 | 580 | 584 |
Returns & Leverage Ratios (%) and Financial Ratios (x)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
ROE (%) | 14.3 | 21.6 | 13.8 | 14.5 | 16.7 |
ROA (%) | 6.7 | 13.1 | 8.6 | 9.4 | 10.3 |
Current ratio (x) | 1.78 | 2.05 | 1.80 | 3.55 | 2.51 |
Total debt / total equity (x) | 0.76 | 0.32 | 0.31 | 0.28 | 0.28 |
Net debt / EBITDA (x) | 1.23 | 0.40 | 0.64 | 0.06 | 0.42 |
Asset turnover (x) | 0.59 | 0.72 | 0.65 | 0.64 | 0.61 |
Dividend payout (%) | 59 | 46 | 68 | 56 | 53 |
Revenue by Region (%)
| Region | Q4 2025 | Q1 2026 |
|---|---|---|
Taiwan – largest single customer (%) | 62.48 | 62.78 |
Taiwan – other customers (%) | 13.39 | 12.61 |
Overseas customers (%) | 24.13 | 24.61 |
Segment Overview (2)
| Segment | Main geography | Comment |
|---|---|---|
DBU | Taiwan about 75%, overseas about 25% | Overseas growth from a US memory maker and a US IDM; the US IDM is expected to reach about 7% of DBU revenue by end-2027 |
SBU | Taiwan-heavy, with domestic and overseas customers historically about half each | Customers in foundry, memory and US IDM; US customers ship wafers to Taiwan for reclaim |
ABU | Taiwan, Japan, Thailand and Southeast Asia | MKS adds Japanese revenue and MGT adds Thai revenue from April 2025 |
Period to 4 Aug 2026 Details
| Period to 4 Aug 2026 | Kinik (%) | TAIEX (%) |
|---|---|---|
Year to date | 70.3 | 53.0 |
1 year | 122.8 | 92.1 |
2 years | 161.5 | 126.4 |
3 years | 427.0 | 166.6 |
5 years | 900.0 | 154.8 |
Valuation Snapshot
| Multiple | Value |
|---|---|
Trailing P/E (x) | 73.3 |
Price / book (x) | 14.4 |
EV / trailing sales, twelve months to June 2026 (x) | 14.6 |
EV / trailing EBITDA, twelve months to June 2026 (x) | 54 |
Trailing EPS (TWD) | 11.93 |
Book value per share (TWD) | 60.6 |
Trailing ROE (%) | 19.1 |
Per-Share Data and Returns & Leverage Ratios (%)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Cash dividend per share (TWD) | 2.80 | 4.00 | 4.00 | 4.00 | 4.94 |
Payout ratio (%) | 59 | 46 | 68 | 56 | 53 |
Analyst Conclusions
Management guidance. Management expects all three business units to grow in 2026, with revenue, gross profit and net profit above 2025 and H2 above H1. It targets more than 70,000 diamond disks a month by end-2026 and 95,000 by end-2027, keeps SBU capacity of 400,000 fully loaded through 2026 with 430,000 planned for 2027, and expects ABU revenue growth of more than 20% in 2026. Management expects DBU revenue to compound at 15–20% a year over three years.
Consensus direction. Revenue for January–September 2026 was NT$7.48 billion. At the Q3 run-rate, full-year 2026 revenue would be close to NT$10 billion, and first-half EPS of NT$6.44 points to full-year EPS well above the share capital. Analysts raised their 2026–2028 estimates after Q2.
Bull case
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Node leadership compounds: 80% share at N2, matched share at A14, and 10–20% more disk usage from A16 mean DBU volume can grow faster than wafer starts, with DBU gross margins above 50% lifting group margins further.
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Customers diversify: a 50% share target at the US memory maker and US IDM revenue reaching about 7% of DBU by 2027 would reduce dependence on one customer while adding growth.
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Operating leverage: three units at full capacity, SBU depreciation per wafer falling, and ABU price rises could keep gross margin around or above 40%. That would support 20%-plus ROE.
Bear case
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Concentration: about 63% of DBU depends on one customer group, so a second-sourcing decision or a delayed node would hit the most profitable business directly.
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Valuation: a trailing P/E above 70x and P/B above 14x already assume flawless execution. The share price fell 14% from 2 October to 16 October 2026 on no company-specific news.
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Capacity and cycle: hiring limits, equipment lead times, rising inventory and NT$1.5 billion of annual capex leave Kinik exposed if semiconductor demand slows as it did in FY2023, when revenue fell 7.6%.
Key catalysts and monitorables (next 12 months)
10 Nov 2026: Catalyst / monitorable: Q3 2026 results and Q4 guidance at the Capital Securities briefing
Early Dec 2026 – Jan 2027: Catalyst / monitorable: October–December monthly revenue; whether FY2026 reaches NT$10 billion
End-2026: Catalyst / monitorable: DBU capacity passing 70,000 disks a month
Q1 2027: Catalyst / monitorable: FY2026 results and dividend proposal; first year with EPS above share capital
2027: Catalyst / monitorable: A14 and A16 volume ramp; US IDM share; advanced-packaging wafer-grinding wheel qualification
2027: Catalyst / monitorable: SBU capacity of 430,000; progress on the Dahu DBU plant and the northern Taiwan SBU site
Ongoing: Catalyst / monitorable: New Taiwan dollar exchange rate; machine-tool cycle; second convertible bond conversion and dilution
Analyst verdict. Kinik has changed from a 70-year-old grinding-wheel maker into one of the more distinctive semiconductor-consumables franchises in Asia. The change shows in the numbers. Gross margin rose from 30.4% in FY2023 to 40.1% in Q2 2026, operating margin reached 24.2%, quarterly EPS rose from NT$1.82 to NT$3.49 in a year, and nine-month 2026 revenue grew 25% with each of the last three months a record. The core of the investment case is the diamond disk. It is a consumable, qualified per node, where Kinik holds an estimated 70–80% share at the world's most advanced foundry, and usage per wafer rises with each new node. The extension into A14, the A16 backside-power uplift and the arrival of US memory and IDM customers make this a multi-year story, not a single 2nm cycle. Reclaim adds a capacity-driven base with improving margins, and the Japanese and Thai acquisitions plus pricing have made the wheel business a contributor rather than a drag. The balance sheet stays conservative, with net debt at 0.4x EBITDA, despite a step-up in capex and two convertible bonds.
The risks are concentrated rather than diffuse. About six in every ten DBU dollars come from one customer group. Capacity is limited by people and equipment, not demand. The share price already implies most of the operating upside, at more than 70x trailing earnings and more than 14x book value. For long-term holders, the quality of the franchise and its visibility into 2027 support a positive fundamental view. For new money, the entry point matters more than the thesis, and the next tests are the 10 November results, the year-end move to 70,000 disks a month, and evidence that overseas customers are lowering concentration. Kinik's fundamentals are strong and improving; its valuation is full.
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View Subscription PlansExecutive Leadership
Executive Leadership Team
| Name | Title | Tenure / background |
|---|---|---|
Lin Po-chuan (林伯全) | Chairman | Third-generation family leader; re-elected chairman after the 23 June 2026 board election; represents Jin Min Investment (金敏投資) on the board |
Lee Wei-chang (李偉彰) | CEO and President; spokesperson | CEO since 1 July 2026; previously general manager of the Diamond Business Unit and vice president; corporate director representative |
Hsieh Jung-che (謝榮哲) | Former CEO and President | Led Kinik as CEO through the 2025 MKS and MGT acquisitions; handed over to Lee Wei-chang on 1 July 2026 |
Pai Ching-chung (白景中) | Vice President; deputy spokesperson | Corporate director representative |
Hung Fu-yi (洪福益) | Vice President | Corporate director representative |
Chou Jui-lin (周瑞麟) | Vice President | Senior management |
Governance Detail
| Corporate director | Representative (pre-2026 term) |
|---|---|
Jin Min Investment Co., Ltd. (金敏投資) | Lin Po-chuan (Chairman); Hsieh Jung-che |
Jin Chi Investment Co., Ltd. (金齊投資) | Lee Wei-chang; Hung Fu-yi |
Li He Investment Co., Ltd. (利和投資) | Pai Ching-chung |
Jin Chuan Investment Co., Ltd. (金泉投資) | Pai Wen-liang (白文亮) |
Major Shareholders
| Holder | Shares held | Approx. stake (%) |
|---|---|---|
Jin Min Investment Co., Ltd. | 9,892,423 | 6.9 |
Jin Chi Investment Co., Ltd. | 4,796,000 | 3.3 |
Jin Chuan Investment Co., Ltd. | 4,117,167 | 2.9 |
Pai Wen-liang | 3,190,605 | 2.2 |
Li He Investment Co., Ltd. | 2,471,420 | 1.7 |
Lin Po-chuan | 1,830,292 | 1.3 |
Pai Ching-chung | 620,000 | 0.4 |
Lee Wei-chang | 500,427 | 0.3 |
Hsieh Jung-che | 295,943 | 0.2 |
Hung Fu-yi | 190,000 | 0.1 |
Competitive Landscape
Competitors by Segment
| Segment | Competitor | Country | Positioning against Kinik |
|---|---|---|---|
CMP diamond disks | 3M | USA | Former leader at the leading foundry; lost 3nm leadership to Kinik in 2021 |
CMP diamond disks | Saesol Diamond | South Korea | Strong with Korean memory makers |
CMP diamond disks | Entegris | USA | Broad CMP consumables portfolio |
CMP diamond disks | Shinhan Diamond | South Korea | Diamond-tool maker active in pad conditioners |
Reclaim wafers | RS Technologies | Japan | Global reclaim leader with plants in Japan, Taiwan and China; also prime wafers |
Reclaim wafers | Phoenix Silicon International (昇陽半導體) | Taiwan | Largest reclaim capacity, about 850,000 a month in 2025; about 70% of revenue from one foundry customer |
Reclaim wafers | Scientech (辛耘) | Taiwan | Reclaim plus wet-process equipment and equipment distribution; expanding Hukou reclaim capacity |
Reclaim wafers | Pure Wafer | UK/USA | Reclaim service in Western markets |
Reclaim wafers | Optim Wafer Services | France/USA | Reclaim service |
Grinding wheels and super-abrasives | Saint-Gobain Abrasives, Tyrolit, Noritake, Kure Grinding Wheel, 3M, Disco (dicing and back-grinding) | France, Austria, Japan, USA | Global abrasives incumbents; Disco leads in semiconductor dicing and grinding |
Peer Comparison FY2025
| Company | FY2025 revenue (local currency, M) | FY2025 revenue growth (%) | FY2025 operating margin (%) | FY2025 EPS (local currency) |
|---|---|---|---|---|
Kinik (TWD) | 8,150 | 16.1 | 16.0 | 9.28 |
RS Technologies (JPY) | 76,707 | 29.6 | 18.6 | — |
Scientech (TWD) | 11,371 | 17.4 | 13.9 | 13.82 |
Phoenix Silicon International (TWD) | 4,509 | 26.9 | — | 4.37 |
