Carchs Holdings Co., Ltd. (7602) AI Stock Analysis

Carchs Holdings Co., Ltd.

(TSE/TYO:7602)

Select Model

Rating:57Neutral

Price Target:JPY 160.00▲(3.23% Upside)

Action:reiterated

Date:09/10/26

The score is primarily held back by weak and inconsistent cash flow and thin/volatile profitability despite strong recent revenue growth and a stable, low-leverage balance sheet. Technicals are supportive (price above major averages with positive MACD) but look stretched (RSI near 70), while valuation is neutral with a modest P/E and minimal dividend support.

Positive Factors

Low LeverageLow leverage and a substantial equity base provide financial flexibility for a dealership business exposed to uneven operating conditions. Limited debt burden can reduce refinancing pressure and preserve capacity to manage inventory, maintain operations, and pursue growth through weaker periods.

Negative Factors

Weak Cash GenerationRepeatedly negative operating and free cash flow raises concerns about the conversion of reported earnings into usable cash. This can increase reliance on liquidity management, constrain internally funded investment, and leave the company less able to absorb weaker trading conditions without financial pressure.

Carchs Holdings Co., Ltd. (7602) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 3.21B
Dividend Yield: 0.65%
Average Volume (3M): 105.90K
Price to Earnings (P/E): 17.1
Beta (1Y): 0.30
Revenue Growth: 3.64%
EPS Growth: ―
Country: Japan
Employees: 198
Sector: General
Sector Strength: 55
Industry: Auto - Dealerships

Carchs Holdings Co., Ltd. Business Overview & Revenue Model

Company Description

Ledax Co., Ltd. operates as a holding company, overseeing its various subsidiaries primarily involved in the automotive sector. These subsidiaries specialize in the procurement, sale, and logistics of automobiles. The firm was established on December...

How the Company Makes Money

Carchs Holdings makes money primarily through its operating subsidiaries by generating revenue from (1) vehicle sales (new and used), where revenue is recognized from the sale of automobiles to retail customers; and (2) after-sales services, includin...

Carchs Holdings Co., Ltd. Financial Statement Overview

Summary

Balance sheet strength (low debt-to-equity and solid equity base) supports stability, but overall performance is constrained by volatile profitability (loss-to-profit swing), declining gross margin (~22% to ~15%), and persistently weak cash conversion with negative operating/free cash flow in most years.

Income Statement

52Neutral

Balance Sheet

70Positive

Cash Flow

34Negative

Financial statement breakdown
Breakdown	TTM	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	20.30B	19.85B	20.03B	19.07B	19.06B	18.38B
Gross Profit	3.02B	3.00B	2.90B	3.15B	2.69B	3.36B
EBITDA	88.11M	-4.82M	-1.49M	243.28M	-373.04M	-157.84M
Net Income	211.59M	170.21M	-187.40M	73.10M	-514.87M	-293.30M
Balance Sheet
Total Assets	7.00B	7.13B	7.07B	7.26B	6.73B	7.63B
Cash, Cash Equivalents and Short-Term Investments	1.95B	2.15B	1.66B	2.32B	1.73B	2.20B
Total Debt	647.60M	650.86M	686.88M	429.74M	629.86M	683.28M
Total Liabilities	2.15B	2.08B	2.21B	2.22B	1.82B	2.18B
Stockholders Equity	4.58B	4.78B	4.61B	4.81B	4.73B	5.28B
Cash Flow
Free Cash Flow	0	-248.45M	-873.13M	781.69M	-411.34M	-1.27B
Operating Cash Flow	0	-241.42M	-861.24M	875.09M	-311.25M	-1.05B
Investing Cash Flow	0	771.13M	16.78M	-67.93M	499.87M	-99.63M
Financing Cash Flow	0	-31.81M	91.08M	-228.62M	-59.67M	515.01M

Carchs Holdings Co., Ltd. Technical Analysis

Technical Analysis SentimentNegative

Last Price155.00

Price Trends

50DMA168.38Negative

100DMA163.09Negative

200DMA185.17Negative

Market Momentum

MACD-4.59Positive

RSI37.07Neutral

STOCH17.22Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7602, the sentiment is Negative. The current price of 155.00 is below the 20-day moving average (MA) of 161.65, below the 50-day MA of 168.38, and below the 200-day MA of 185.17, indicating a bearish trend. The MACD of -4.59 indicates Positive momentum. The RSI at 37.07 is Neutral, neither overbought nor oversold. The STOCH value of 17.22 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:7602.

Carchs Holdings Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

JP:7602 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:5589	84Outperform	JPY 20.90B	12.67	―	2.29%	6.93%	11.18%
JP:4732	77Outperform	JPY 823.70B	19.63	21.34%	3.23%	11.30%	12.09%
JP:7593	69Neutral	JPY 59.04B	10.40	―	4.82%	13.60%	12.08%
JP:3186	61Neutral	JPY 190.42B	10.26	―	1.83%	23.54%	111.44%
JP:7602	57Neutral	JPY 3.21B	17.13	―	0.65%	3.64%	―
JP:7599	56Neutral	JPY 96.19B	8.05	―	3.73%	16.85%	-1.43%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%

* General Sector Average

Performance Comparison

JP:7602 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:7602	Carchs Holdings Co., Ltd.	155.00	21.91	16.46%
JP:4732	USS Co	1785.00	137.89	8.37%
JP:3186	Nextage Co., Ltd.	2455.00	140.41	6.07%
JP:5589	AUTOSERVER CO.,LTD	2876.00	390.24	15.70%
JP:7593	VT Holdings Co., Ltd.	498.00	33.33	7.17%
JP:7599	IDOM Inc.	958.00	-161.70	-14.44%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Sep 10, 2026

Carchs Holdings Co., Ltd. AI Stock Analysis