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JONBUR Research · Initiation

Gaeasoft · 051160 · Software

Gaeasoft: Sharp Share Price Rise, Thin Margins and a Model Estimate Well Above the Market Price

Why this report

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Gaeasoft's shares closed at ₩12,700 on 2026-10-23, up 70.2% over three months, while trailing operating margin stays thin at 5.5%. A model estimate of ₩30,556 per share sits well above the price, but it rests on assumptions and a wide bear-to-bull range.

Written Oct 25, 2026 · Data as of Oct 23, 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 picture of a growing but low-margin software and distribution-type business, with revenue rising every year shown and profit recovering from a 2022 loss. Trailing net income of ₩15.8B and ROE of 10.6% are better than 2025 (8.8%).

The share price has moved sharply, up 69.3% over one year and 5.5% over one month, and sits below the 52-week high of ₩15,600. Foreign ownership rose from 17.3% to 26.3% in 60 days, and foreigners and institutions were net buyers over 20 days while retail investors were net sellers.

What the data does not show is why the shares moved. No news headlines are available. Filings show a treasury stock acquisition result, a share cancellation decision and a rights offering decision within weeks of each other, which point in different directions for shareholders. Details of the rights offering size and purpose are not in the data.

Business overview

Gaeasoft is a KOSDAQ-listed software company, founded in 1998 and listed in 2002, with 13,482,648 listed shares and a market capitalization of about ₩171.2B. Revenue is large relative to its market value: trailing revenue is ₩582.0B, giving a price-to-sales ratio of 0.3. Revenue grew from ₩378.6B in 2021 to ₩587.1B in 2025. Segment details are not available in the data.

Financial analysis

These figures come from filed financial statements. Revenue was ₩587.1B in 2025 (up 7.3%), ₩547.2B in 2024 (up 7.5%) and ₩508.9B in 2023 (up 11.9%).

Operating income was ₩25.1B in 2025, ₩29.1B in 2024 and ₩15.2B in 2023, after a ₩3.1B loss in 2022. Operating margin was 4.3% in 2025 and 5.3% in 2024. Net income was ₩12.6B in 2025 versus ₩17.9B in 2024.

On a trailing basis to H1 2026, revenue was ₩582.0B, operating income ₩32.2B (5.5% margin), net income ₩15.8B (2.7% margin) and ROE 10.6%. Liabilities to equity were 37.5%. Cash was ₩46.7B against borrowings of ₩44.2B, and free cash flow was ₩35.7M-scale to be read as ₩35.7B. The dividend yield is 0.0%.

Valuation

The share trades at a P/E of 10.8 and P/B of 1.1. At the end of 2025 P/E was 8.4 and P/B 0.7, and at the end of 2024 they were 6.1 and 0.8, so the multiples are higher than in the last two year-ends but well below 2021 (P/E 37.5, P/B 3.4).

Among the listed peers, P/E ranges from 7.1 (NC, Netmarble) to 46.6 (Hyundai Autoever), and P/B from 0.5 to 4.7. Gaeasoft's P/E is within that range, near Krafton's 10.2. The peers are much larger companies.

The valuation model (5-year discounted cash flow, 7.4% rate) gives a base estimate of ₩30,556 per share, with a bear case of ₩13,057 and a bull case of ₩61,095. This is a model estimate based on the assumptions shown, not a target. The price of ₩12,700 is just below even the bear case, but the wide range shows how sensitive the result is to assumptions, especially given thin margins.

Catalysts

  • The half-year report for June 2026 was filed on 2026-08-13 and is the basis for the latest trailing figures.
  • A share cancellation decision (2026-09-03) following a treasury stock acquisition results report (2026-08-24) could reduce the share count.
  • A rights offering decision was filed on 2026-09-17, and its terms and use of proceeds would matter for share count and balance sheet.
  • Foreign ownership rising from 17.3% to 26.3% in 60 days, with 5%+ holding reports filed on 2026-08-19 and 2026-09-28, show changing large-holder positions.
  • Frequent insider shareholding reports, the latest on 2026-10-23, show ongoing changes in insider holdings.

Risks

  • Operating margin of 5.5% is thin, so small cost or pricing changes can move profit materially, as the 2022 loss shows.
  • The rights offering decision could dilute existing shareholders, and its terms are not in the data.
  • The share price is up 70.2% in three months, so sentiment-driven reversals are possible and no news explains the move.
  • Net income fell from ₩17.9B in 2024 to ₩12.6B in 2025 despite higher revenue, showing earnings are not steadily rising.
  • The model estimate has a very wide range (₩13,057 to ₩61,095), so it offers limited precision.

Closing view

The data shows a business with steady revenue growth, modest profitability, moderate leverage and positive free cash flow, trading at 1.1 times book value after a strong share price run. The model's base estimate is well above the current price, but the wide range, thin margins and a pending rights offering argue for caution in reading it. Missing information, such as news and rights offering terms, limits how far any conclusion can go.

Model estimate of fair value

Bear
₩13,057
+7%
Base
₩30,556
+150%
Bull
₩61,095
+400%

Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal.

Base case of the 5-year discounted cash flow model on the stock's Valuation tab (statements TTM to H1 2026; discount rate 7.4%). Bear and Bull move the main assumptions by fixed steps. See and change the assumptions

Filings and data used

Report history

  1. Oct 25, 2026InitiationStart of coverage (reader request)Gaeasoft: Sharp Share Price Rise, Thin Margins and a Model Estimate Well Above the Market Price

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