Tah Kong Chemical Industrial Corp. (4706) AI Stock Analysis

Tah Kong Chemical Industrial Corp.

(TPEx:4706)

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Rating:54Neutral

Price Target:TWD 45.00▲(7.14% Upside)

Action:initiatedcoverage

Date:11/09/26

Tah Kong Chemical scores in the lower-middle range, weighed down primarily by deteriorating financial performance: revenue declined, margins compressed across the board, net profit fell roughly 64%, operating cash flow dropped sharply and free cash flow turned negative. The exceptionally conservative balance sheet — near-zero debt and equity funding over 90% of assets — provides genuine downside protection and staying power through the chemical cycle, but return on equity under 2% shows that capital is not being deployed productively. Valuation is a further drag, with a P/E near 39 and a sub-1% dividend yield pricing in a recovery that has yet to materialize. The main offset is constructive technicals: the shares trade above all major moving averages with positive MACD momentum, currently pausing in a neutral RSI zone. Overall, a defensively financed but low-return business whose share price has run ahead of its earnings fundamentals.

Positive Factors

Conservative Balance SheetVery low leverage and a sizable equity cushion provide financial resilience in a cyclical specialty chemicals environment. This conservative funding profile can reduce solvency pressure, preserve borrowing capacity, and give management flexibility to sustain operations through weaker demand periods.

Negative Factors

Profit Margin CompressionThe sharp decline in net margin shows that reported revenue is currently converting into substantially less profit. Persistently thinner margins would reduce earnings resilience, limit internal funding for investment, and make the company more exposed to further operating or demand pressure.

Tah Kong Chemical Industrial Corp. (4706) vs. SPDR S&P 500 ETF (SPY)

Market Cap: TWD 3.20B
Dividend Yield: 0.71%
Average Volume (3M): 126.86K
Price to Earnings (P/E): 37.7
Beta (1Y): 0.26
Revenue Growth: 7.93%
EPS Growth: 656.08%
Country: TW
Employees: 327
Sector: General
Sector Strength: 55
Industry: Chemicals - Specialty

Tah Kong Chemical Industrial Corp. Business Overview & Revenue Model

Company Description

Tah Kong Chemical Industrial Corporation is a global entity engaged in the production, processing, and distribution of diverse chemical products, including paints, colorants, and chemical intermediaries. Its operational scope spans Taiwan, the broade...

Tah Kong Chemical Industrial Corp. Financial Statement Overview

Summary

A mixed picture dominated by weak earnings and cash generation. Revenue fell roughly 7% to about NT$1.11 billion and remains well below the 2021 peak, while gross, operating and net margins all compressed sharply, cutting net income by about 64% to NT$28 million (income statement score 36). Cash flow was the other soft spot: operating cash flow dropped roughly 69% and free cash flow swung negative to NT$27 million after capex (cash flow score 38). The offset is a fortress balance sheet (score 79) with debt-to-equity of just 0.03 and equity funding about 91% of assets, though return on equity of ~1.9% shows that capital is under-utilized. Net: very safe, but currently low-return and lacking growth.

Income Statement

36Negative

Balance Sheet

79Positive

Cash Flow

38Negative

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.19B	1.11B	1.20B	1.08B	1.22B	1.45B
Gross Profit	214.80M	172.41M	213.16M	140.50M	196.83M	287.96M
EBITDA	100.92M	68.03M	143.17M	51.09M	104.99M	157.11M
Net Income	87.91M	28.03M	78.10M	5.59M	50.88M	89.19M
Balance Sheet
Total Assets	1.74B	1.67B	1.70B	1.59B	1.64B	1.73B
Cash, Cash Equivalents and Short-Term Investments	603.13M	571.61M	655.59M	600.66M	513.88M	485.42M
Total Debt	52.23M	40.90M	43.02M	38.48M	27.29M	42.03M
Total Liabilities	191.22M	154.22M	173.76M	138.91M	156.41M	228.68M
Stockholders Equity	1.55B	1.51B	1.53B	1.45B	1.49B	1.50B
Cash Flow
Free Cash Flow	50.35M	-27.06M	58.98M	134.11M	100.53M	-47.34M
Operating Cash Flow	93.42M	28.37M	90.39M	153.76M	116.06M	-23.66M
Investing Cash Flow	-50.40M	23.53M	-93.88M	-128.80M	-191.76M	-59.38M
Financing Cash Flow	-33.86M	-55.10M	-15.56M	-47.23M	-71.13M	-152.89M

Tah Kong Chemical Industrial Corp. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

TW:4706 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TW:1730	71Outperform	TWD 3.19B	10.50	―	5.94%	1.66%	8.74%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
TW:4706	54Neutral	TWD 3.32B	37.66	―	0.71%	7.93%	656.08%
TW:8463	53Neutral	TWD 3.19B	10.76	―	3.76%	-3.02%	-15.76%
TW:4303	50Neutral	TWD 3.58B	2.93	―	3.70%	30.28%	-32.60%
TW:6582	44Neutral	TWD 3.38B	45.43	―	―	-55.46%	―
TW:1721	40Underperform	TWD 3.58B	-12.56	―	―	-16.64%	-29.46%

* General Sector Average

Performance Comparison

TW:4706 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
TW:4706	Tah Kong Chemical Industrial Corp.	42.00	12.23	41.07%
TW:1721	Sunko Ink Co., Ltd.	19.85	8.40	73.36%
TW:1730	Farcent Enterprise Co., Ltd.	50.50	0.39	0.78%
TW:4303	Hsin-Li Chemical Industrial Corp.	27.00	-22.85	-45.84%
TW:6582	Shin Foong Specialty & Applied Materials Co., Ltd.	31.80	-1.80	-5.36%
TW:8463	Ruentex Materials Co Ltd	21.30	-4.05	-15.97%

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: Nov 09, 2026

Tah Kong Chemical Industrial Corp. AI Stock Analysis