Heungkuk Fire & Marine Insurance흥국화재
000540 · KOSPI · ₩000540 · 흥국화재
Valuation model · P/B vs ROE (excess return)
Banks, insurers and brokers don't suit a cash flow model (borrowing and lending is their business), so we value them on book value and return on equity: P/B vs ROE.
Fair value per share
With these assumptions the model gives no positive value.
- Cost of equity
- 9.5%
- Fair P/B
- —
- P/B now
- —
Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal. This is not financial advice.
Bear / Base / Bull
- Bear
- —
- Base
- —
- Bull
- —
Bear: ROE 2 points lower and cost of equity 1 point higher. Bull: the opposite.
Assumptions
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Business
- 17.4%
Yearly profit as a share of shareholders' equity.
Default: average return on equity of the last 3 annual reports.
- 2%
How fast book value and profits grow over the long run.
Default: close to the economy's long-run growth.
Discount rate
- 4.01%
Yield on Korea's 10-year government bond: the return with almost no risk.
Default: Korea Treasury Bond 10-year yield on 2026-10-30.
- 1
How much the share moves when the market moves: 1 means just like the market.
Default: 1.0. Measured beta is 0.6, but against a KOSPI dominated by chipmakers that understates a bank's or insurer's risk, so we use at least the market's.
- 5.5%
The extra return investors want for owning shares instead of bonds.
Default: a typical premium for Korean shares.
Starting point
- Net debt (borrowings and leases − cash and deposits)
- ₩0
- Equity (book value)
- —
- Shares
- 65,010,645
- incl. 768,000 preferred
- Share price
- ₩3,050
- Market cap
- ₩200B
Sensitivity
Fair value per share as two inputs change; the middle is the current case.
| Cost of equity ↓ · ROE → | 15.4% | 16.4% | 17.4% | 18.4% | 19.4% |
|---|---|---|---|---|---|
| −1.0% | — | — | — | — | — |
| −0.5% | — | — | — | — | — |
| 0.0% | — | — | — | — | — |
| 0.5% | — | — | — | — | — |
| 1.0% | — | — | — | — | — |
Now (TTM)
- Market cap
- ₩196B
- Enterprise value
- —
- P/E
- 1.2×
- P/B
- —
- P/S
- —
- EV/EBITDA
- —
- Dividend yield
- 0.0%
Over time (at each year end)
| 2025 | 2024 | 2023 | |
|---|---|---|---|
| Price | ₩3,590 | ₩3,670 | ₩3,070 |
| Market cap | ₩231B | ₩236B | ₩197B |
| P/E | 1.5× | 2.2× | 0.6× |
| P/B | 0.3× | 0.3× | 0.1× |
| P/S | — | — | — |
| EV/EBITDA | 1.6× | 2.8× | 1.0× |
| Dividend yield | 0.0% | — | — |
Versus similar companies
| Company | P/E | P/B | P/S | EV/EBITDA | Dividend yield |
|---|---|---|---|---|---|
| Heungkuk Fire & Marine Insurance | 1.2× | — | — | — | 0.0% |
| Samsung Life Insurance | 19.3× | 0.4× | — | — | 0.0% |
| Samsung Fire & Marine Insurance | 13.7× | 0.8× | — | — | 3.0% |
| DB Insurance | 6.6× | 0.9× | — | — | 4.1% |
| Hyundaimarine&Fireinsuranceco | 3.2× | 0.6× | — | — | 0.0% |
| Hanwha Life Insurance | 3.4× | 0.2× | — | — | 0.0% |
| Seoul Guarantee Insurance | 9.8× | 0.6× | — | — | 6.6% |
| Similar companies (median) | 8.2× | 0.6× | — | — | 1.5% |
Calculated from end-of-day prices and filed financial statements. Not a recommendation. This is not financial advice.
Also known as: Heungkuk Fire & Marine Insurance / 흥국화재 / 000540 / KRX:000540
Source: KRX statistical information