Nippon Steel Chemical & Material Co., Ltd. Overview
NIPPON STEEL Chemical & Material is the chemicals and advanced-materials arm of the Nippon Steel group. It combines aromatic chemistry, which comes from the coal tar that steelmaking leaves behind, with precision-metal technologies: ultra-thin foil, fine wire and micro-particles. Its consolidated sales of about JPY 260–275 billion come from three reporting segments: Coal Chemicals, Chemicals and Functional Materials. Functional Materials is now the largest and fastest-growing segment, at 44.6% of FY2025 sales. For the semiconductor supply chain, the most important asset is Nippon Micrometal. NMC commercialised the world's first practical palladium-coated copper (PCC) bonding wire, the EX1, and is consistently ranked among the top five bonding-wire makers worldwide. Other semiconductor-adjacent businesses include micro solder balls, spherical silica and alumina fillers for epoxy mould compounds, adhesive-free flexible copper-clad laminates (Espanex), low-dielectric vinyl resins for high-speed server and AI boards, and OLED and LCD display materials. Under Nippon Steel's 2030 Mid-Term Management Plan, the company is the core of the parent's non-steel segment. Its targets are a company-wide ROS above 10% and substantial profit growth to FY2030.
What the company does. NSCM makes and sells three groups of products:
Coal chemicals: Products made from coal tar and light oil recovered from Nippon Steel's coke ovens: pitch coke, needle coke, pitch, carbon black feedstock oil, 95% naphthalene, phthalic anhydride, carbon black and industrial gases (hydrogen, argon, oxygen, nitrogen).
Basic and specialty chemicals: Styrene monomer (through NS Styrene Monomer Co., Ltd.), benzene, toluene, xylene, methanol, divinylbenzene, cyclohexane, specialty solvents, ammonium sulphate, lubricants and lubricant condition monitoring. Bisphenol A was also made until the Kyushu plant was suspended.
Functional materials: Circuit-board materials (Espanex adhesive-free FCCL, functional resins including low-dielectric vinyl resins and epoxy resins), LCD and OLED display materials, UV- and thermosetting resin materials, rolled metal foil, metal carriers for exhaust catalysts, spherical silica and alumina micro-particles, semiconductor interconnect materials (bonding wire and micro solder balls through Nippon Micrometal), pitch-based carbon fibre (Nippon Graphite Fiber), carbon-fibre composites such as TEPreg and NS-TEPreg, and porous carbon (MCND) used as a fuel-cell catalyst support.
Company's own description. NSCM describes its mission as "Mastering materials, opening the future" (素材を極め、未来を拓く). Its basic principle is "For Your Dream & Happiness": to support society and enrich the world through highly distinctive businesses. The company says the 2018 integration was meant to strengthen the core coal chemicals and chemicals businesses. It also aimed to fuse Nippon Steel & Sumikin Chemical's synthesis, purification and formulation know-how with Nippon Steel & Sumikin Materials' thin-foil, fine-wire and fine-particle technologies, so that the group could serve customers as a comprehensive materials supplier.
Independent characterisation. NSCM is best understood as two businesses under one corporate shell:
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A cyclical, by-product commodity chemicals business (Coal Chemicals and Chemicals). Its earnings depend on naphtha and aromatics spreads, carbon black and needle-coke demand, and the parent's coke-oven throughput. It made up 55% of FY2025 sales, down from 77% in FY2022. It has been the focus of capacity rationalisation: the Kashima Works was suspended, Kyushu bisphenol A production was halted, and the NS Epoxy Mita plant was closed.
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A portfolio of niche, high-share electronic and advanced materials (Functional Materials). Many of its products are, in the company's words, "only-one" businesses. Demand is now driven by semiconductors, AI data centres, high-speed communications, displays and automotive electrification. This segment grew from JPY 77.0 billion in FY2020 to JPY 115.0 billion in FY2025. It is the main reason underlying profit roughly doubled between FY2023 and FY2025.
Business and revenue model. Almost all revenue comes from selling products under supply agreements and spot orders. Over time NSCM has also licensed intellectual property, most notably the EX1 copper bonding-wire patents licensed to Tanaka Denshi Kogyo in 2011 and Heraeus in 2012. Royalty income is not reported separately. NSCM sells no subscription or software products.
Value-chain position.
Upstream: Coal tar, crude benzene and coke-oven gas by-products from Nippon Steel's steelworks; naphtha-derived aromatics; and precious and base metals (gold, silver, palladium, copper, aluminium) for bonding wire.
Midstream (NSCM): Distillation, synthesis, polymerisation, fine-wire drawing and coating, foil rolling and particle spheroidisation.
Downstream customers: OSATs and IDMs (bonding wire, solder balls); epoxy mould compound makers (fillers); FPC and CCL laminators and PCB fabricators (Espanex, low-Dk resins); display panel makers (OLED and LCD materials); tyre and rubber makers (carbon black); graphite-electrode and anode producers (needle coke); styrenics and resin producers (styrene monomer, DVB); automotive Tier-1s (metal carriers, composites); and fuel-cell vehicle makers (MCND).
End markets. Semiconductors and electronics, AI and data centres, high-speed communications (5G and beyond), smartphones and PCs, displays, automotive (exhaust treatment, fuel cells, power devices, battery modules), steel and electrodes, tyres and rubber, infrastructure repair (carbon-fibre sheet reinforcement of tunnels and bridges), aerospace (satellite films) and general chemicals.
Nippon Micrometal in detail. NMC develops, makes and sells semiconductor interconnect materials. It is one of the few companies that make both bonding wire and solder micro-balls. Its bonding-wire range covers copper (including PCC, the EX series), silver, gold and aluminium wire. NMC says it was the first company in the world to mass-produce palladium-coated copper bonding wire as a substitute for gold. It operates the Iruma plant and the Yorii works in Saitama, a manufacturing plant in Batangas (Philippines), a manufacturing affiliate in Hangzhou (China) and a sales company in Kuala Lumpur (Malaysia). Its stated new-market goals are power devices and automotive applications, beyond its traditional LSI and memory packaging customers. The aluminium wire NL1 targets power modules and lithium-ion battery-module interconnects.
Wantstats' Bonding Wire and Copper Pillars research names NMC as a participant. NMC's publicly disclosed portfolio is bonding wire and micro solder balls; it has not publicly disclosed a copper-pillar bump product line.
Strategy
FY2025 Mid-Term Management Plan (FY2021–FY2025). NSCM achieved the plan's final-year profit target. Underlying business profit reached JPY 24.2 billion in FY2025, against the roughly JPY 21 billion level the President cited as the target. The plan combined:
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Structural reform: closing Kashima, Kyushu BPA and Mita, and exiting HIP metal products.
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Company-wide cost reduction and price improvement.
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Development and promotion of new products.
2030 Mid-Term Management Plan (from FY2026). The plan sits within Nippon Steel's group-wide 2030 Mid-Term Management Plan, announced at the end of 2025. That plan positions NSCM as the core company of the non-steel segment, expected to grow substantially over five years. The President's January 2026 address set out four pillars:
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Profitability and continuous profit growth. The target is a company-wide ROS above 10%, up from single digits at the time, through stronger business structures and tighter margin control.
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A mid- to long-term growth strategy. A Growth Strategy Committee has identified many "short-term" projects that can produce results relatively quickly, plus "mid-to-long-term" projects across 11 material fields aimed at 2030 and beyond. A promotion structure has been set up, and the organisation was changed in April and July 2026.
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Carbon neutrality. The target is a 30% cut in energy- and process-related CO2 emissions by the end of FY2030 compared with FY2013, with net zero as the 2050 vision.
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Foundations. DX begins with upgrading system infrastructure, then building core-business databases and data-literacy talent. Human-resource development covers diverse hiring, the personnel system and training.
Strategic themes. NSCM aims to strengthen links between manufacturing, sales and research across business boundaries ("製・販・研の連携") to create new growth products and fields. It wants to capture AI and data-centre-driven semiconductor demand, which it expects to stay strong beyond April 2026, while protecting supply chains from tariff shocks.
Initiatives announced in the last 24 months
- Low-dielectric thermosetting vinyl resin plant and second line — Type: Capacity growth; Detail: Serves CCL demand for AI servers and high-speed communications
Ichikawa metal foil manufacturing department: Type: Capacity and organisation; Detail: New production base for rolled foil
Alumina filler capacity increase: Type: Capacity growth; Detail: Thermal fillers for semiconductor and EV thermal management
Exit from HIP metal products: Type: Portfolio pruning; Detail: Decided October 2024; completed December 2025
Suspension of the Kashima Works and Mita plant: Type: Restructuring; Detail: Effective March 2025
ISCC PLUS certifications (Tahara, NS Styrene Monomer Oita): Type: Sustainability; Detail: April 2025; enables mass-balance bio and circular feedstock products
- Multi-stakeholder policy (updated February 2025 and January 2026) — Type: Governance and human capital; Detail: Covers wage increases and fair dealing with suppliers
Health management declaration: Type: Human capital; Detail: April 2026
Reorganisations (April 2025, April 2026, July 2026): Type: Organisation; Detail: Growth project structure, IT/DX HQ
NMC new high-reliability Cu wire and NL1 Al wire: Type: Product; Detail: Push into automotive, power devices and battery modules
"S Project" and "KRP Project": Type: Internal growth projects; Detail: Led by the Micrometal and Functional Resin & Substrate heads respectively; scope not publicly disclosed
Medium-term financial targets and guidance. The 2030 plan targets ROS above 10%; the absolute 2030 profit target is not publicly disclosed. FY2026 guidance is sales of JPY 320.0 billion, business profit of JPY 34.0 billion (ROS 10.6%) and underlying business profit of JPY 33.0 billion. If achieved, FY2026 would meet the 2030 plan's ROS target in its first year.
Products & Services
Functional Materials — semiconductor interconnect (Nippon Micrometal)
| Product line | Description and capabilities | Target customer | Year and version | Flagship |
|---|---|---|---|---|
| EX1 PCC copper bonding wire | Copper wire with a single palladium coating that resists oxidation. It matches gold wire on ball bondability and reliability at a much lower material cost. It suits high-density, multi-tier LSI packages, including 18 µm wire at 50 µm pitch. | OSATs and IDMs (LSI, memory, logic) | Mass production since 2009 | EX1 |
| EX1p | Improved PCC wire with multiple coating layers. It gives better bonding to dies and lead frames and allows faster wire bonding. It was excluded from the 2011 Tanaka licence. | High-density and fine-pitch packaging | Launched 2011; technical paper 2017 | EX1p |
| New high-reliability Cu bonding wire | A next-generation copper wire for automotive and high-temperature reliability. Defect rates are controlled to the order of tens of ppm, and it bonds at under 0.1 seconds per wire. | Automotive, high-reliability ICs | Nippon Steel Technical Report No. 134, November 2025 | EX series |
| Silver alloy bonding wire | Ag alloy wire with In, Ga, Pd and Pt additions. It extends high-temperature life and reduces chip damage, for automotive memory devices. | Memory and automotive memory | Patented | — |
| Gold bonding wire | High-purity Au wire, typically 15–30 µm in diameter. | Legacy and high-end packages | Long-established | — |
| NL1 aluminium bonding wire | Al wire with higher bondability and corrosion resistance. It bonds to hard Ni and Cu terminals and to battery caps and bus bars. | Power semiconductors, lithium-ion battery modules (EV) | Nippon Steel Technical Report No. 134, November 2025 | NL1 |
| Micro solder balls | Solder spheres for BGA and CSP external connections. NMC is one of the few makers of both bonding wire and solder micro-balls. | OSATs, substrate makers | Long-established | — |
Functional Materials — circuit-board and resin materials
| Product line | Description | Target customer | Flagship and notes |
|---|---|---|---|
| Espanex | Adhesive-free flexible copper-clad laminate made from polyimide and copper foil. It is used in smartphone and wearable FPCs and has a dedicated sales department. | FPC makers | Espanex |
| Low-dielectric thermosetting vinyl resin | Soluble vinyl resin for rigid CCLs used in 5G and next-generation high-speed boards. It targets a dissipation factor of 0.0015 or below and good multi-layer processability and heat resistance. A new plant and a second line were built to meet AI server demand. | CCL makers, server and AI board makers | Developed at the Sodegaura research site |
| Epoxy resins | Speciality epoxy resins. Production was consolidated after the NS Epoxy Mita plant was suspended in March 2025. | Electronics, composites | NS Epoxy |
| UV- and thermosetting resin materials | Functional resin materials for electronics. | Electronics | — |
| BSF-30 polyimide film | A polyimide film resistant to atomic oxygen. It extends the durability of the D-SAIL satellite deorbit device. | Space and aerospace | Announced November 2025 |
Functional Materials — display materials
| Product line | Description | Target customer |
|---|---|---|
| OLED materials | Organic electroluminescent materials run by the OEL department | OLED panel makers |
| LCD materials (Esfine and related products) | Colour-filter and photo-resist-type display resins; Esfine has its own sales department | LCD panel makers |
Functional Materials — metals and particles
| Product line | Description | Target customer | Notes |
|---|---|---|---|
| Rolled metal foil | Ultra-thin stainless and other alloy foils. The group once held about 90% of the world market for HDD suspension foil. A new Ichikawa manufacturing department was set up in 2025–2026. | HDD, electronics, batteries | Metal Foil Works, Ichikawa |
| Metal carriers | Metal honeycomb substrates for catalytic converters | Automotive and two-wheeler OEMs and Tier-1s | Made in Hangzhou (China), Jakarta (Indonesia) and Chennai (India) |
| Spherical silica and alumina fillers | Micro-spheres used as fillers in epoxy mould compounds and thermal interface materials. Alumina capacity was increased in 2025. | EMC makers, thermal materials | Harimic Malaysia (Penang); domestic plants |
| HIP metal products | Hot-isostatic-pressed metal products | Industrial | Exit decided October 2024; production and sales ended by December 2025 |
Functional Materials — carbon and composites
| Product line | Description | Target customer | Flagship |
|---|---|---|---|
| Pitch-based carbon fibre | Ultra-high-modulus fibre made by Nippon Graphite Fiber | Aerospace, robotics, sports | GRANOC (Nippon Graphite Fiber brand) |
| TEPreg and NS-TEPreg | Thermoplastic carbon-fibre prepreg and mesh. Used in a lightweight helmet (2022) and adopted in VAIO's SX14-R laptop (2025). | Electronics, consumer protection gear | NS-TEPreg |
| CFRP strengthening systems | Carbon-fibre sheet methods for repairing and reinforcing infrastructure such as tunnels and bridges | Construction, highways | Exhibited at Highway Techno Fair |
| MCND porous carbon | Mesoporous carbon nano-dendrite used as a catalyst support in fuel cells | Fuel-cell stack makers | Adopted in the Toyota MIRAI (2021) |
Coal Chemicals
| Product | Use |
|---|---|
| Needle coke | Graphite electrodes for electric arc furnaces; lithium-ion battery anodes |
| Pitch coke and pitch | Carbon materials, binders |
| Carbon black feedstock oil and carbon black | Tyres, rubber, inks. The Tahara Works holds ISCC PLUS certification for carbon black. |
| 95% naphthalene, phthalic anhydride | Plasticisers, dyes |
| Industrial gases | Hydrogen, argon, oxygen, nitrogen |
Chemicals
| Product | Use and notes |
|---|---|
| Styrene monomer | Polystyrene, ABS, SBR. Made by NS Styrene Monomer at Oita, which holds ISCC PLUS certification. |
| Benzene, toluene, xylene | Aromatic intermediates (ISCC PLUS certified at Oita) |
| Divinylbenzene (DVB) | Crosslinker for ion-exchange resins, elastomers and latex. NSCM is Japan's only producer, with integrated production based on its own dehydrogenation technology. |
| Methanol, cyclohexane, specialty solvents | Intermediates and solvents |
| Ammonium sulphate | Fertiliser |
| Lubricants and condition monitoring | Industrial lubricants (Sinlube brand) and the Tribo Center analytical services |
Pricing models for individual products are not publicly disclosed. Industrial materials of this kind are typically sold under negotiated contracts. For bonding wire, prices are usually indexed to precious-metal (Au, Ag, Pd) and copper prices plus a fabrication fee.
Financial Narrative
NSCM is a private subsidiary. It publishes consolidated sales, business profit (事業利益, an IFRS-style operating measure used by the Nippon Steel group), an "underlying" business profit that excludes inventory valuation and other temporary items, capex, depreciation, R&D, year-end interest-bearing debt and net financial expense. Gross profit, net income, EPS, dividends, total assets, equity, cash, goodwill and cash-flow statements are not publicly disclosed.
Income statement, JPY billion
Sources: company consolidated results releases of 10 May 2023, 9 May 2025 and 5 November 2026.
Underlying business profit (excluding inventory valuation and one-off items), JPY billion
Sources: President's New Year address, January 2026 (FY2022–FY2024), and the November 2026 results release (FY2025). The January 2026 address expected FY2025 underlying profit of about JPY 21.0 billion; the actual result was JPY 24.2 billion.
Half-year trend, JPY billion
Revenue growth and CAGR. Sales grew 39.8% in FY2021 as the business recovered from the pandemic, rose 9.9% in FY2022, fell 5.0% in FY2023, rose 3.2% in FY2024 and fell 4.2% in FY2025. The five-year CAGR from FY2020 (JPY 178.7 billion) to FY2025 was about 7.6%. The four-year CAGR from FY2021 to FY2025 was about 0.8%. Business profit had a CAGR of about 23.5% from FY2020 (JPY 7.6 billion) to FY2025, but this is flattered by the depressed base year. From FY2023 to FY2025 it grew at about 19.6% a year.
Commentary.
FY2021 peak: The post-COVID recovery, firm aromatics and styrene spreads and strong electronics demand produced the record JPY 25.3 billion business profit.
FY2022–FY2023 trough: Profit fell by more than a third in FY2022 to JPY 16.1 billion even though sales hit a record. The decline came from soaring feedstock costs (naphtha at JPY 76,300/kL), China's zero-COVID slowdown, falling shipments from the second quarter of FY2022, and weak chemicals markets. FY2023 profit edged down to JPY 15.3 billion as sales fell 5%.
FY2024–FY2025 inflection: Underlying profit rose from JPY 12.7 billion to JPY 24.2 billion in two years, nearly doubling. Three things drove it: demand for semiconductor and AI data-centre materials (low-Dk resins, fillers, bonding wire, foil); the closure of loss-making assets (Kashima, Kyushu BPA, Mita); and company-wide cost and pricing measures. The company says it largely avoided damage from US tariffs in 2025, with the exception of some businesses.
H1 FY2026 step-change: Business profit of JPY 22.4 billion (ROS 14.3%) already exceeds all of FY2025. Reported profit (JPY 22.4 billion) is above underlying profit (JPY 18.1 billion), which points to inventory valuation gains of about JPY 4.3 billion as naphtha and aromatics prices rose. Underlying profit still nearly doubled year on year from JPY 11.0 billion.
Balance sheet and leverage indicators, JPY billion
Interest-bearing debt fell to JPY 4.3 billion at the end of September 2026. Total assets, cash and equivalents, equity, goodwill and intangibles, and working capital are not publicly disclosed, so net debt, debt-to-equity, current ratio, ROE, ROA, ROIC, asset turnover and the cash conversion cycle cannot be calculated. Gross debt has never exceeded 0.4 times the EBITDA proxy over the period, which points to a very lightly leveraged balance sheet. Group-level cash is probably managed centrally by Nippon Steel. The interest-cover ratios are calculated from net financial expense rounded to JPY 0.1 billion, so they are approximate.
Investment and cash-generation indicators, JPY billion
Capex was JPY 6.6 billion in H1 FY2026. Capex is measured as the increase in tangible and intangible fixed assets, including transfers from construction in progress. "EBITDA proxy less capex" is a rough pre-tax, pre-working-capital measure of cash generation, not a reported free cash flow. Operating cash flow, free cash flow, dividends paid to the parent and buybacks are not publicly disclosed.
Commentary. Capex has risen faster than depreciation since FY2024, reaching 1.6 times depreciation in FY2025. Growth investment has gone into a new low-dielectric vinyl resin plant and second line, the new Ichikawa metal-foil manufacturing department and higher alumina-filler capacity. Management says it will keep spending ahead of demand.
Macro drivers disclosed by the company
In H1 FY2026 the average rate was JPY 160.5 per USD and naphtha was JPY 108,100/kL. That combination raises yen sales of export products and lifts chemicals prices through cost pass-through. It also creates inventory valuation gains while prices rise, and losses when they fall.
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Segment Overview
| Segment | What it contains | Main group companies and sites |
|---|---|---|
Coal Chemicals | Coal-tar distillation and derivatives: needle coke, pitch coke, pitch, carbon black (feedstock oil and finished product), naphthalene, phthalic anhydride, industrial gases | Kisarazu, Kyushu (Tobata, Kitakyushu), Oita, Himeji and other works; Nippon Techno Carbon (carbon black); the Kashima Works was suspended in March 2025 |
Chemicals | Aromatics (benzene, toluene, xylene), styrene monomer, divinylbenzene, methanol, cyclohexane, specialty solvents, ammonium sulphate, lubricants and tribology services | NS Styrene Monomer (Oita), Tribo Center |
Functional Materials | Espanex FCCL; functional resins (low-Dk vinyl resins, epoxy); display materials (OLED, LCD); metal foil; metal carriers; spherical silica and alumina fillers; bonding wire and micro solder balls; pitch-based carbon fibre; CFRP composites; MCND porous carbon | Nippon Micrometal; Nippon Graphite Fiber; Harimic Malaysia; NSCM Indonesia, India and Hangzhou (metal carriers); Metal Foil Works; Ichikawa; Hikari; Sodegaura (R&D) |
Revenue by Segment
| Segment | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Coal Chemicals sales (JPY Bn) | 39.0 | 62.0 | 58.0 | 61.0 | 52.0 |
Chemicals sales (JPY Bn) | 120.0 | 125.0 | 110.0 | 108.0 | 91.0 |
Functional Materials sales (JPY Bn) | 91.0 | 88.0 | 93.0 | 100.0 | 115.0 |
Total consolidated sales (JPY Bn) | 249.8 | 274.5 | 260.8 | 269.1 | 257.9 |
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View Subscription PlansSegment Margins & Growth (%)
| Segment | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|
Coal Chemicals YoY growth (%) | 59.0 | -6.5 | 5.2 | -14.8 |
Chemicals YoY growth (%) | 4.2 | -12.0 | -1.8 | -15.7 |
Functional Materials YoY growth (%) | -3.3 | 5.7 | 7.5 | 15.0 |
Total YoY growth (%) | 9.9 | -5.0 | 3.2 | -4.2 |
Revenue by Segment (%)
| Segment | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Coal Chemicals share (%) | 15.6 | 22.6 | 22.2 | 22.7 | 20.2 |
Chemicals share (%) | 48.0 | 45.5 | 42.2 | 40.1 | 35.3 |
Functional Materials share (%) | 36.4 | 32.1 | 35.7 | 37.2 | 44.6 |
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View Subscription PlansIncome Statement and Margin Analysis (%)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Net sales (JPY Bn) | 249.8 | 274.5 | 260.8 | 269.1 | 257.9 |
Business profit (JPY Bn) | 25.3 | 16.1 | 15.3 | 18.9 | 21.9 |
Business profit margin ROS (%) | 10.1 | 5.9 | 5.9 | 7.0 | 8.5 |
Depreciation (JPY Bn) | 7.1 | 7.3 | 7.8 | 7.5 | 8.0 |
Business profit plus depreciation, EBITDA proxy (JPY Bn) | 32.4 | 23.4 | 23.1 | 26.4 | 29.9 |
EBITDA proxy margin (%) | 13.0 | 8.5 | 8.9 | 9.8 | 11.6 |
Net financial expense (JPY Bn) | 0.1 | 0.1 | 0.1 | 0.1 | 0.2 |
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View Subscription PlansKey Financials and Margin Analysis (%)
| Metric | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|
Underlying business profit (JPY Bn) | 11.0 | 12.7 | 19.4 | 24.2 |
Underlying ROS (%) | 4.0 | 4.9 | 7.2 | 9.4 |
Key Financials and Margin Analysis (%) (Half-Yearly)
| Metric | H1 FY2021 | H1 FY2022 | H1 FY2023 | H1 FY2024 | H1 FY2025 | H1 FY2026 |
|---|---|---|---|---|---|---|
Net sales (JPY Bn) | 122.5 | 144.9 | 132.8 | 140.4 | 128.1 | 156.2 |
Business profit (JPY Bn) | 13.5 | 13.6 | 10.8 | 12.2 | 9.8 | 22.4 |
ROS (%) | 11.0 | 9.4 | 8.1 | 8.7 | 7.7 | 14.3 |
Key Financials and Financial Ratios (x)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Year-end interest-bearing debt (JPY Bn) | 12.8 | 5.1 | 7.6 | 5.3 | 8.3 |
Change in interest-bearing debt (JPY Bn) | -5.7 | -7.7 | 2.5 | -2.3 | 3.0 |
Debt to EBITDA proxy (x) | 0.40 | 0.22 | 0.33 | 0.20 | 0.28 |
Business profit to net financial expense (x) | 253 | 161 | 153 | 189 | 110 |
Cash Flow and Margin Analysis (%)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Capital expenditure (JPY Bn) | 7.9 | 9.5 | 9.4 | 10.2 | 12.6 |
Capex to sales (%) | 3.2 | 3.5 | 3.6 | 3.8 | 4.9 |
Capex to depreciation (x) | 1.11 | 1.30 | 1.21 | 1.36 | 1.58 |
EBITDA proxy less capex (JPY Bn) | 24.5 | 13.9 | 13.7 | 16.2 | 17.3 |
Key Financials
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
JPY per USD average | 112.0 | 134.9 | 143.9 | 152.7 | 150.8 |
Domestic naphtha price (JPY K per kL) | 57.0 | 76.3 | 68.8 | 75.6 | 65.6 |
Capital Markets Data
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Interest-bearing debt year-end (JPY Bn) | 12.8 | 5.1 | 7.6 | 5.3 | 8.3 |
Analyst Conclusions
Management guidance (5 November 2026)
Net sales (JPY bn): FY2025 actual: 257.9; FY2026 forecast: 320.0
Business profit (JPY bn): FY2025 actual: 21.9; FY2026 forecast: 34.0
Underlying business profit (JPY bn): FY2025 actual: 24.2; FY2026 forecast: 33.0
ROS (%): FY2025 actual: 8.5; FY2026 forecast: 10.6
The forecast implies second-half FY2026 sales of JPY 163.8 billion and business profit of JPY 11.6 billion, against JPY 22.4 billion in the first half. That suggests either a conservative second half or an expected reversal of inventory gains if feedstock prices ease. There is no external analyst consensus because the company is unlisted. The parent's 2030 plan expects NSCM to grow substantially over five years.
Bull case
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AI materials flywheel. Functional Materials sales rose 15% in FY2025 to JPY 115.0 billion and are running at about JPY 136 billion a year in H1 FY2026. New low-Dk resin, foil and alumina capacity can sustain double-digit growth.
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Structural margin uplift. Underlying ROS rose from 4.9% (FY2023) to 9.4% (FY2025). With loss-making plants closed, FY2026 guidance of 10.6% shows the 2030 ROS target is already achievable.
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Interconnect IP and new markets. NMC's patent-protected PCC heritage, plus the NL1 and high-reliability Cu wires, opens automotive, power and battery markets where wire bonding remains dominant.
Bear case
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Inventory-driven peak. In H1 FY2026, JPY 4.3 billion of business profit came from inventory valuation gains on JPY 108,100/kL naphtha. A commodity reversal could cut reported profit sharply, as happened in FY2022.
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Commodity drag. More than half of sales is still commodity chemicals, and Chemicals sales fell 27% from FY2022 to FY2025 as Asian oversupply persisted.
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Competition and technology risk in wire. Chinese wire makers and the shift to hybrid bonding could erode NMC's share and pricing within a top-five group that controls about 55% of the market.
Key catalysts (next 12 months)
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FY2026 full-year results against the JPY 34.0 bn profit guidance — Timing: May 2027
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Gap between underlying and reported profit as naphtha and FX move — Timing: Quarterly
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Ramp-up of the low-Dk vinyl resin second line and alumina capacity — Timing: FY2026–FY2027
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Any quantified 2030 profit target or growth-project announcements (S Project, KRP Project) — Timing: 2027
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Customer adoption of NMC's new high-reliability Cu and NL1 Al wires in automotive and battery programmes — Timing: Ongoing
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Publication of CO2 progress against the FY2030 target of -30% — Timing: Next sustainability disclosure
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Parent's portfolio decisions within the 2030 plan, including capital allocation after the U.S. Steel acquisition — Timing: Ongoing
Chemical Materials Japan 2026 product launches: Timing: 26–27 November 2026
Analyst verdict. NIPPON STEEL Chemical & Material has quietly turned itself from a coal-tar and aromatics processor into a growing supplier of materials to the semiconductor and AI hardware supply chain. FY2025 sales of JPY 257.9 billion were below FY2022's JPY 274.5 billion, yet underlying business profit roughly doubled to JPY 24.2 billion over two years. The change came from mix rather than volume: Functional Materials rose from 32% to 45% of sales, while Kashima, Kyushu BPA, the Mita epoxy plant and HIP metal products were shut or exited. In H1 FY2026 the company earned more than it did in all of FY2025, and full-year guidance of a 10.6% ROS would reach the 2030 plan's headline target in its first year.
For semiconductor-supply-chain observers, Nippon Micrometal is the centrepiece. It invented palladium-coated copper bonding wire, licensed it to its two largest rivals, and remains one of the five suppliers that together control about 55% of global bonding-wire revenue. Its push into aluminium wire for power modules and EV battery packs, and into high-reliability copper wire for automotive ICs, targets the markets where wire bonding is most durable. The main structural threat is advanced packaging that bypasses wire altogether, together with rising Chinese competition.
Earnings quality deserves some caution. Part of the 2026 surge reflects inventory gains from a weak yen and high naphtha prices. More than half of revenue is still commodity chemicals whose feedstock base will shrink as the parent decarbonises. Disclosure is thin: there is no public balance sheet, cash flow or segment profit.
On balance, NSCM is a well-capitalised, parent-backed materials group whose strategic direction is clearly positive. The FY2027 results will show whether ROS can stay above 10% on an underlying basis once commodity tailwinds fade. Above all, they will show whether Functional Materials, led by low-Dk resins, fillers and Nippon Micrometal's interconnects, can keep growing by double digits. If it can, NSCM becomes one of the more valuable non-steel assets in the Nippon Steel portfolio.
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View Subscription PlansExecutive Leadership
Executive Leadership Team
| Name | Title | Responsibilities |
|---|---|---|
Akio Migita (右田 彰雄) | Representative Director and President | Chief executive since 26 June 2023 |
Hiroshi Yamazaki (山﨑 博司) | Director, Senior Managing Executive Officer | Technology, environment and safety, quality assurance, process technology, facility construction coordination, IoT promotion, company-wide repair-cost management, carbon neutrality |
Shingo Izumi (泉 真吾) | Director, Senior Managing Executive Officer | Head of the Metal Foil Applied Products Division; business management and support, SCM promotion, strategic planning, carbon neutrality |
Murase (村瀨 賢芳) | Director, Managing Executive Officer | HR and general affairs, recruitment, competency development and health, legal and CSR, IT/DX HQ |
Eishi Sogo | Director, Managing Executive Officer | Head of the Coal Chemicals Division |
Seiji Kato | Director, Senior Executive Officer | Corporate Planning HQ |
Takashi Yamada | Managing Executive Officer | Head of the Micrometal Division; "S Project" leader; President of Nippon Micrometal |
Yuji Kubo | Managing Executive Officer | Head of the R&D Headquarters; intellectual property; carbon neutrality |
Seiro Otani | Senior Executive Officer | Head of the Chemicals Division; President of NS Styrene Monomer |
Chihiro Hatano | Senior Executive Officer | Head of the Functional Resin & Substrate Materials Division; KRP Project Leader |
Kenichi Shimojo | Senior Executive Officer | Head of the Composites Division |
Isao Yamada | Senior Executive Officer | Head of the Fine Carbon Division and Carbon Materials Research Lab |
Takeshi Nakayama | Senior Executive Officer | Head of the Kisarazu Works |
Tomohiko Shimatani | Senior Executive Officer | Head of the Himeji Works |
Takahisa Ohno | Senior Executive Officer | Deputy Head of Metal Foil Applied Products; head of the Metal Foil Works |
Shigeru Itsuno | Senior Executive Officer | Facility Construction Coordination Center; KRP Project Manager |
Hiroichi Hasebe | Executive Officer | Head of the Display Materials Division |
Manabu Tani | Executive Officer | Head of the High-Function Filler Division |
Masahiko Suenaga | Executive Officer | SCM promotion |
Taro Honjo | Executive Officer | Recruitment Center; Competency Development & Health Center |
Board & Management Changes
| Date | Change |
|---|---|
26 Jun 2023 | Akio Migita succeeds Toshiharu Sakae as President. Sakae becomes Director and Senior Adviser. |
25 Jun 2024 | Sakae becomes Senior Adviser only. Takayuki Kaneko leaves the board to become Special Adviser. Two standing auditors retire. |
24 Jun 2025 | Yamazaki is promoted to Senior Managing Executive Officer. Sakae retires as Senior Adviser on 30 June 2025. |
1 Dec 2025 | Executive officer appointments take effect. |
1 Apr 2026 and 23 Jun 2026 | Officer appointments take effect alongside the April reorganisation. Sogo and Kato sit on the board. |
Competitive Landscape
Competitors by Segment
| Business | Competitor | Country | Relative positioning |
|---|---|---|---|
Bonding wire | Heraeus Electronics | Germany | Global leader in bare Cu and Au wire; EX1-type PCC licensee |
Bonding wire | Tanaka Denshi Kogyo (TANAKA Holdings) | Japan | Leading Au and Cu wire maker; EX1 licensee |
Bonding wire | MK Electron | South Korea | Major Au, Ag and Cu wire supplier; strong with Korean memory makers |
Bonding wire | LT Metals | South Korea | Ag and Au wire, memory packaging |
Bonding wire | Doublink Solders | Malaysia | Cost-competitive ASEAN supplier |
Bonding wire | Ningbo Kangqiang Electronics | China | Domestic Chinese supplier gaining from localisation |
Bonding wire | Yantai Zhaojin Kanfort | China | Chinese Au and Cu wire maker |
Bonding wire | Tatsuta Electric Wire & Cable | Japan | Japanese wire specialist |
Bonding wire | AMETEK (Coining) | USA | Specialty and power interconnects |
Solder balls | Senju Metal Industry; Duksan Hi-Metal | Japan; Korea | Leaders in BGA solder spheres |
Spherical fillers | Denka; Admatechs; Nippon Steel group peers | Japan | Spherical silica and alumina for EMC and thermal applications |
Low-Dk resins and FCCL | SABIC; Mitsubishi Gas Chemical; Daiichi Kogyo Seiyaku; Panasonic Industry | Saudi Arabia/global; Japan | PPE/OPE resins and laminates. In July 2026 Daiichi Kogyo Seiyaku announced about JPY 10 bn of low-Dk resin capacity, showing how fast competitor capacity is being added. |
OLED materials | Idemitsu Kosan; Merck KGaA; Universal Display; Duksan Neolux | Japan, Germany, USA, Korea | Emitter and host materials |
Needle coke and coal chemicals | Mitsubishi Chemical (C-Chem); JFE Chemical; Phillips 66; Chinese producers | Japan, USA, China | Needle coke for electrodes and anodes |
Styrene and aromatics | Idemitsu Kosan; Asahi Kasei/Mitsubishi Chemical; Denka; Asian petrochemical producers | Japan, Asia | Commodity aromatics |
Pitch carbon fibre | Mitsubishi Chemical (DIALEAD) | Japan | The other principal pitch-based CF maker |
Competitor Detail
| Metric | NSCM FY2025 |
|---|---|
Sales (JPY Bn) | 257.9 |
Sales growth (%) | -4.2 |
Business profit margin (%) | 8.5 |
R&D to sales (%) | 2.4 |
Recent Developments
Employees at closed plants were redeployed; management committed to protecting jobs during the restructuring.
