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JONBUR Research · Initiation

Knowmerce · 473980 · Entertainment

Knowmerce: Profitable Entertainment Small Cap Trades Well Below Its Year-Ago Price

Why this report

Start of coverage: written when a reader opened this company and there was no report yet.

Knowmerce, a KOSDAQ entertainment company with a market cap of ₩121.8B, has a 1-year share price return of -61.9% even as filed profits stayed high. The shares closed at ₩11,190 on 2026-10-29, below the model's base estimate of ₩16,397 per share.

Written Oct 30, 2026 · Data as of Oct 29, 2026 · 0 views

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

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Thesis

The data shows a gap between the share price and reported earnings. Trailing revenue is ₩75.3B, operating margin is 14.7% and return on equity is 16.0%, yet the stock is down 61.9% over one year and sits 64.4% above its 52-week low of ₩8,740 but 64.4% below... its high of ₩31,450 is far above the current price. More precisely, the price is about 64.4% under the 52-week high. The recent bounce (+8.5% in one month, +23.0% in three months) shows some recovery. The data supports solid profitability and a low debt load. It does not explain why the price fell, and the news headlines provided are about a different company (Autonomous A2Z) and say nothing about Knowmerce. Net income (₩15.7B) is higher than operating income (₩11.1B), so non-operating items contribute to profit, and the data does not say what they are. The company has been active with buybacks, a share cancellation decision and a convertible bond issue, which point to capital management but whose terms are not in the data.

Business overview

Knowmerce is listed on KOSDAQ in the entertainment sector. It was founded on 2019-03-13 and listed on 2024-11-12, with 10,882,752 listed shares. Revenue was ₩68.9B in 2024 and ₩75.7B in 2025, growth of 9.9%. Trailing twelve-month revenue to H1 2026 is ₩75.3B, roughly flat versus 2025. The data does not describe its products or business lines.

Financial analysis

These figures come from filed financial statements. Revenue was ₩68.9B in 2024 and ₩75.7B in 2025. Operating income rose from ₩8.2B (11.9% margin) to ₩12.3B (16.3% margin), and net income from ₩9.9B to ₩14.8B. ROE rose from 11.5% to 15.6%. Trailing figures to H1 2026: operating income ₩11.1B (14.7% margin), net income ₩15.7B (20.9% margin), ROE 16.0%. The operating margin is slightly lower than in 2025. The balance sheet is conservative: liabilities to equity of 13.8%, cash of ₩6.4B and borrowings of ₩0.9B. Free cash flow is ₩9.1B. A convertible bond issue was filed in July and August 2026, but its size is not in the data. The dividend yield is 0.0%.

Valuation

At the current price the P/E is 7.7, P/B 1.1 and P/S 1.6; enterprise value is ₩116.3B and EV/EBITDA is not available. At the end of 2025 the P/E was 20.5 and P/B 2.9, and at the end of 2024 22.7 and 2.6, so current multiples are well below the company's own history. Peers show P/E of 13.7 (SM Entertainment), 12.7 (JYP Entertainment) and 21.7 (YG Entertainment), with P/B between 1.1 and 2.1 (HYBE and CJ CGV have no P/E in the data). Knowmerce's P/E is below the peers that have one, and its P/B of 1.1 matches the low end, equal to CJ CGV. The valuation model (5-year discounted cash flow, 7.4% rate, based on trailing figures to H1 2026) gives a model estimate based on the assumptions shown of ₩16,397 per share in the base case, ₩11,132 in the bear case and ₩25,271 in the bull case. The current price of ₩11,190 is close to the bear case. This is not a target or a reason to buy or sell.

Catalysts

  • A new buyback trust contract was signed on 2026-10-16, following an earlier one on 2026-07-15 and a share cancellation decision on 2026-07-08.
  • The half-year report filed on 2026-08-14 showed trailing operating income of ₩11.1B and a net margin of 20.9%, and the next report will show whether this holds.
  • A 5%+ holding report was filed on 2026-08-10, which points to changes among larger shareholders.
  • Over 20 days, foreign investors (₩865M net) and institutions (₩575M net) were net buyers while retail investors sold ₩1.4B net.

Risks

  • The share price is down 61.9% over one year and the data gives no reason, so the cause of the derating is unclear.
  • The 3rd convertible bond series issued in 2026 could add shares if converted, but its size and terms are not in the data.
  • Trailing operating income of ₩11.1B is below net income of ₩15.7B, so earnings depend partly on non-operating items that the data does not explain.
  • Foreign ownership is small at 2.6% and fell from 2.9% over 60 days, and the market cap of ₩121.8B suggests limited liquidity.
  • The recent news headlines relate to another company, so there is no company-specific news in the data to assess business developments.

Closing view

The filings show a profitable, lightly indebted company whose multiples have fallen far below its own year-end history and sit near the low end of listed peers. The model's base estimate is above the current price, but the price is close to the bear case, which shows how sensitive the result is to its assumptions. Still, the steep one-year decline, the convertible bond issue and the lack of company-specific news or business detail leave open questions. The data supports solid reported earnings, but it does not settle why the market values them so low.

Model estimate of fair value

Bear
₩11,132
-1%
Base
₩16,397
+47%
Bull
₩25,271
+126%

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 30, 2026InitiationStart of coverage (reader request)Knowmerce: Profitable Entertainment Small Cap Trades Well Below Its Year-Ago 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