6850.T

Company Overview

• Chino is a B2B manufacturer focused on temperature-centric measurement, control, and monitoring products including sensors, instruments, and custom system solutions for industrial and R&D use, founded in 1913.
• It operates 3 domestic production sites, 17 domestic sales locations, 6 domestic group companies, and 6 overseas group companies (China, South Korea, India, Thailand, US) with additional agency coverage across Europe, North America, Taiwan, and ASEAN, with overseas sales accounting for ~20% of total 2024 revenue.

Core Competitive Strengths

• Proprietary registered trademark Loop Solution: integrated end-to-end temperature measurement, control, and monitoring solutions tailored to client industrial workflows.
• Industry-leading temperature technology: Chino's standard temperature sensors are used as national reference standards by research institutes and companies in 29 countries, with capability to cover the full range from -269°C extreme cryogenic to 3,500°C ultra-high temperature applications.
• Established end-market applications across high-growth decarbonization and advanced technology sectors: artificial diamond production temperature monitoring, automotive painting process defect reduction, pharmaceutical/medical blood and vaccine storage temperature monitoring, fuel cell performance evaluation testing, water electrolysis evaluation equipment for hydrogen production, fusion power reactor wall temperature monitoring, and bioethanol production moisture management.

Recent Corporate Actions

• Implemented a 2-for-1 stock split on October 1, 2025 to lower the minimum investment amount, improve share liquidity, and expand the investor base in response to Tokyo Stock Exchange requests.
• Approved a 1.3 billion yen上限 share repurchase program (November 2025 to November 2026) for up to 860,000 shares (~5% of outstanding shares), with repurchased shares planned for cancellation to improve capital efficiency and shareholder returns.
• Published the annual integrated report Chino Report 2025, available on the company website.

Shareholder Return Policy

• Targets increasing payout ratio to 40% by FY2026 (final year of the mid-term management plan), with a goal of consistent dividend increases via sustained profit growth.
• For FY2025, the interim dividend is 12.5 yen per share (post-split), and full-year dividend is forecast at 42.5 yen per share (post-split), a 2.5 yen per share increase year-over-year.
• Updated the shareholder points program after the stock split, lowering the minimum holding requirement to 300 shares (post-split) to expand eligibility for benefits.

• Full year FY2025 (ending March 2026) guidance is unchanged from the May 2025 announcement: total sales of 30 billion yen (+2.3% year-over-year) and operating profit of 2.9 billion yen (+0.7% year-over-year).
• Chino targets 7 billion yen in overseas sales by FY2026, focused on expanding market share in high-growth segments including semiconductors and synthetic diamond production.
• The company aims to continue growing its participation in decarbonization and hydrogen economy projects, leveraging its existing measurement technology across the full hydrogen supply chain.

Chino divides its business into four main segments, with the three core segments each contributing approximately 30% of total annual revenue (2024 full year data):

1. Measurement and Control Instruments: Reported net sales of 4.62 billion yen, with segment profit of 699 million yen. This segment saw year-over-year decreases in both revenue and profit, driven by temporary demand slowdown in China despite solid demand from semiconductor/electronic component manufacturing equipment and heat processing clients.
2. Instrumentation Systems: Reported net sales of 4.532 billion yen, with segment profit of 213 million yen. This segment achieved year-over-year revenue growth (driven by expanding demand for compressor testing equipment for natural refrigerant air conditioners, a decarbonization-related product) but saw a year-over-year profit decrease due to lower-than-expected profit margins on individual projects.
3. Sensors: Reported net sales of 4.502 billion yen, with segment profit of 937 million yen. This segment achieved year-over-year growth in both revenue and profit, driven by solid demand from electronic component manufacturing equipment and heat processing clients, plus increased sales from group company Meiyo Electric.

• Persistent global inflation, prolonged high long-term interest rates, slowing Chinese economic growth, and impacts from US tariff policy have created sustained uncertainty in the global operating environment.
• Geopolitical and economic security issues including US-China trade tensions have become more prominent, requiring increased monitoring by management.
• Chino's business performance is heavily dependent on customer capital expenditure trends, which are vulnerable to broader macroeconomic slowdowns.

Q: Are Chino's products used for hydrogen transport, in addition to hydrogen production and use? / A: Chino group company Meiyo Electric manufactures specialized cryogenic temperature sensors for liquid hydrogen, which requires cooling to -253°C for transport. These sensors are designed to maintain accurate temperature measurement even during the vibration common to maritime transport of liquid hydrogen, covering all parts of the hydrogen supply chain from production through transport and end use.

Q: What are Chino's key domestic market shares and main competitors for its core products? / A: Per 2024 Fuji Keizai research, Chino holds 15.3% domestic market share for recorders (3rd place, behind Yokogawa Electric and Keyence), 5.7% for controllers (5th place), 19.9% for power regulators (2nd place, behind Fuji Electric). Chino believes it holds the number 1 domestic market share for radiation thermometers, with particular strength in temperature management for metal heat processing applications.

Q: Can you explain Chino's Loop Solution offering with a simple example? / A: Loop Solution refers to the integrated cycle of temperature measurement, control, and monitoring, which can be illustrated with deep frying tempura: to cook good tempura you need to maintain a constant 170°C oil temperature. A thermometer measures the current temperature, a controller adjusts the burner heat to hold 170°C, and a recorder logs that the correct temperature was maintained throughout cooking. This end-to-end integrated solution is what Chino provides for industrial and R&D workflows.

Q: What is Chino's strategy to grow overseas sales? / A: Chino has set China and South Korea as core priority markets for growth, and is targeting additional demand from fast-growing ASEAN and India. The strategy has two pillars: first, localize marketing to match regional market needs, currently focused on growing radiation thermometer sales for semiconductor manufacturing equipment (China/South Korea) and synthetic diamond production (China/India); second, expand production capacity at Chino's Chinese manufacturing site to supply ASEAN and India, build out local marketing, and target adoption of Chino's heat processing products, with a goal of hitting the FY2026 overseas sales target of 7 billion yen.