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JONBUR Research · Initiation

Youlchon Chemical · 008730 · Rubber & plastics

Youlchon Chemical: Thin Profits Return After Two Years of Losses, Shares Down 60.3% Over a Year

Why this report

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Youlchon Chemical posted a small profit in 2025 and in the trailing twelve months to H1 2026, after losses in 2022 to 2024, while the share price is down 60.3% over one year but up 17.5% over three months. Margins are thin at 1.4% operating and the balance sheet carries ₩249.3B of borrowings against ₩8.3B of cash.

Written Oct 20, 2026 · Data as of Oct 19, 2026 · 0 views

This is not financial advice. The report does not recommend buying or selling anything.

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Thesis

The data supports a recovery in earnings from losses: operating income moved from -₩18.4B in 2024 to ₩8.5B in 2025 and ₩7.3B over the trailing twelve months. Revenue has also grown for two years, by 10.3% in 2024 and 6.2% in 2025. What the data does not support is a strong profit base. Operating margin is 1.4%, ROE is 1.7% and free cash flow is -₩26.0B. The share price is 15,160 won, well below the 52-week high of 38,100 won and 36.0% above the low of 11,150 won. Ownership signals are mixed: foreign ownership rose to 5.6% from 5.1% sixty days ago, and institutions were net buyers over 20 days, while retail investors were net sellers. Short balance is 0.2%. Several 5%+ holding reports were filed in recent months, but the data does not say what they contain.

Business overview

Youlchon Chemical is a KOSPI-listed company in the rubber and plastics sector, founded in 1973 and listed in 1988. It has 24.8M listed shares and a market capitalization of about ₩376.0B. Revenue was ₩538.7B in 2021, fell to ₩414.5B in 2023, and recovered to ₩485.4B in 2025. Trailing twelve-month revenue to H1 2026 is ₩516.2B. The data does not describe its products or segments, so nothing further is stated here. No recent news headlines are available.

Financial analysis

These figures come from filed financial statements. Trailing twelve-month revenue to H1 2026 is ₩516.2B, operating income ₩7.3B and net income ₩5.0B, for an operating margin of 1.4% and a net margin of 1.0%. In 2025 revenue was ₩485.4B, operating income ₩8.5B (1.8% margin) and net income ₩4.2B, with ROE of 1.4%. Net losses were -₩4.1B in 2022, -₩19.1B in 2023 and -₩8.5B in 2024. 2021 net income was ₩8.5B. The trailing liabilities-to-equity ratio is 140.6%. Borrowings are ₩249.3B versus cash of ₩8.3B. Free cash flow is -₩26.0B, meaning operations did not cover investment over the period.

Valuation

The stock trades at a P/E of 75.1, P/B of 1.3 and P/S of 0.7, with a 0.0% dividend yield. Enterprise value is ₩617.1B; EV/EBITDA is not available. The high P/E reflects very small earnings. P/B of 1.3 is below its year-end levels of 2.2 in 2025, 1.8 in 2024, 2.6 in 2023 and 2.7 in 2022. Listed comparison companies show P/E of 3.6 to 21.9 (Kumho Tire 3.6, Nexen Tire 3.8, Hankook Tire & Technology 6.6, Dongwon Systems 10.5, Pum-Tech Korea 21.9) and P/B of 0.3 to 2.8. Youlchon's P/E is above all of them. Its P/B is above most of them, except Pum-Tech Korea at 2.8. The valuation model estimate is not available, since fair_value_model could not be worked out from the data.

Catalysts

  • The half-year report filed on 2026-08-14 showed trailing profits, and the next set of results will show whether the recovery continues.
  • Repeated 5%+ holding reports on 2026-07-01, 2026-09-17, 2026-09-22 and 2026-10-07 point to changes in significant shareholdings.
  • A change in the largest shareholder's holdings was filed on 2026-06-19.
  • Foreign ownership rose from 5.1% to 5.1% sixty days earlier to 5.6% now, and institutions were net buyers of about ₩964.2M over 20 days.
  • An investor relations event was held on 2026-07-21, though the data gives no content.

Risks

  • Margins are thin, with a 1.4% operating margin, so small cost changes could return the company to losses as in 2022 to 2024.
  • Free cash flow is -₩26.0B and cash is only ₩8.3B against ₩249.3B of borrowings.
  • Liabilities are 140.6% of equity, which leaves the balance sheet sensitive to financing costs.
  • The P/E of 75.1 rests on very small profits and is above the listed comparison companies shown.
  • The shares fell 60.3% over one year, and no dividend is paid (yield 0.0%).

Closing view

The numbers show a company moving from losses to a marginal profit, with revenue growing and the share price recovering over three months. Against that, returns are low, cash flow is negative and borrowings are large relative to cash. The multiple on earnings is high and no model estimate is available, so the data does not settle whether the recovery will broaden. Future results and balance sheet changes are the main items to watch.

Model estimate of fair value

The valuation model has no estimate for this company yet (not enough data, or no positive value with the base case).

Filings and data used

Report history

  1. Oct 20, 2026InitiationStart of coverage (reader request)Youlchon Chemical: Thin Profits Return After Two Years of Losses, Shares Down 60.3% Over a Year

Built only from jonbur's own data: prices and investor flows, filed financial statements and filings, and news headlines. Disclosed (filed) data is labelled as such. Written by AI and may contain mistakes.

This is not financial advice. The report does not recommend buying or selling anything.

Source: KRX statistical information