Briefing on activated carbon: Reaffirming medium-term potential

Research evidence excerpt

Briefing on activated carbon: Reaffirming medium-term potential

Global Markets Research

19 June 2026Kuraray

3405.T 3405 JP / EQUITY: JAPAN CHEMICALS & TEXTILES

Briefing on activated carbon: Reaffirming Rating Neutralmedium-term potential

Target price JPY 1,470Quick Note

Closing price

18 June 2026 JPY 1,753.5Watching for possibility of significant profit increase from 29/12

Kuraray held a briefing to discuss its activated carbon business (environmental solutions) (Note: Quick Note reports are not a

at 10am JST on 19 June. While the company's medium-term operating margin target for vehicle for changes to ratings, target

activated charcoal (above 10%) was pushed back from 30/12 to 32/12, we believe the prices, or earnings forecasts)

briefing confirmed the potential for operating profit to expand over the medium term,

mainly driven by PFAS-related demand (see our 21 June 2024 report, "Kuraray[3405]

(Neutral)"). We believe that, in the short term, depreciation expenses related to the

$100mn investment in its Columbus, Ohio facility could become a burden, but we are Research Analysts

mindful of the potential for operating profit growth from 29/12 onward as sales of higher-

Japan chemicals & textilesmargin reactivated charcoal expand.

Shigeki Okazaki - NSC

Key comments made by the company shigeki.okazaki@nomura.com

(1) Due to macroeconomic uncertainty, including higher US tariffs and economic security +81 3 6703 1170

concerns, demand for activated carbon has been slower to grow than it had expected

back in June 2024. However, the company believes there is no need to change its

medium-term view. Sales in 32/12 should reach around 2.5x the 23/12 level (the company

has not disclosed figures, but we estimate environmental solutions sales in 25/12 at