Ask Warren

Silla

004970 · KOSPI · ₩004970 · 신라교역

₩8,950▲ ₩100 (1.13%)End-of-day · Oct 29, 2026 · End-of-day prices.
Trade
Alert me
SellBuy

Valuation model · Discounted cash flow (DCF)

We use a 5-year discounted cash flow: the value of the cash the business is expected to produce, in today's money.

Fair value per share

₩16,806

vs the current price (₩8,950)

Enterprise value
₩83B
Equity value
₩269B
WACC
7.4%

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

Why the model and the price differ

The model is 88% away from today's price. A gap this size usually means the market expects something the past figures don't show yet, or the model leaves something out. What we can see:

  • To match today's price of ₩8,950, the model needs an operating margin of 0.6% every year (it uses 2.6%).
  • 96% of the last 12 months' net profit came from outside operations (stakes in other companies, interest, one-offs). The model adds those stakes at book value but doesn't project that income.
  • Today's P/E is 3.0× against a typical 5.4× over the last 10 years.

Treat the model as a starting point: change the assumptions to the story you believe, and compare with the multiples check below.

Bear / Base / Bull

Bear
₩10,343
+15.6%
Base
₩16,806
+87.8%
Bull
₩29,159
+225.8%

Bear: revenue growth 3 points lower every year, EBIT margin 2 points lower, WACC 1 point higher. Bull: the opposite.

Assumptions

Sign in to change the assumptions and see the results update. Sign in

Cycle options

Margin path

Every year uses the cycle-average margin (2.6%).

Revenue growth

  • 1.7%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (1.7% a year, annual reports), fading to 3% by year 5.

  • 2%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (1.7% a year, annual reports), fading to 3% by year 5.

  • 2.3%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (1.7% a year, annual reports), fading to 3% by year 5.

  • 2.7%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (1.7% a year, annual reports), fading to 3% by year 5.

  • 3%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (1.7% a year, annual reports), fading to 3% by year 5.

Business

  • 2.6%

    Operating profit as a share of revenue.

    Default: through-the-cycle average of the last 12 months and the last 5 annual reports' operating margins.

  • 27.5%

    Share of operating profit paid as corporate tax.

    Default: Korea's top corporate tax rate (25%) plus 10% local income tax.

  • 3.2%

    The non-cash cost of wearing out equipment, added back to cash flow (% of revenue).

    Default: not in the statements, so 80% of capital spending (most spending replaces equipment that wears out).

  • 4%

    Money spent on factories, equipment, software and other long-term assets (% of revenue).

    Default: average of the last 3 annual reports (cash flow statements; equipment and intangibles).

  • 23.8%

    Stock and unpaid customer bills, less unpaid supplier bills, as a % of revenue. Each year's extra revenue ties up this much more cash.

    Default: working capital (current assets less cash and deposits, minus current liabilities other than borrowings) as a share of revenue, averaged over the last 3 years.

Discount rate

  • 2%

    How fast cash flows keep growing every year after year 5.

    Default: about Korea's long-run inflation plus real growth.

  • 4.08%

    Yield on Korea's 10-year government bond: the return with almost no risk.

    Default: Korea Treasury Bond 10-year yield on 2026-10-29.

  • 0.6

    How much the share moves when the market moves: 1 means just like the market.

    Default: 105 weeks of weekly returns against KOSPI (official index); raw beta 0.1, adjusted toward 1 and kept between 0.6 and 2.0.

  • 5.5%

    The extra return investors want for owning shares instead of bonds.

    Default: a typical premium for Korean shares.

  • 5.58%

    The interest rate the company would pay to borrow.

    Default: the 10-year yield plus a 1.5% credit spread.

Starting point

Revenue (TTM to H1 2026)
₩448B
Net debt (borrowings and leases − cash and deposits)
−₩157B
+ Stakes and investments
₩30B
Associates, long-term financial assets and deposits (book value)
− Minority interests
₩1.9B
Shares
16,000,000
Share price
₩8,950
Market cap
₩143B

TTM = trailing 12 months: the last four reported quarters added together. "TTM to H1 2026" is the 12 months up to the latest quarterly or half-year report (H1 = to the end of June). Year 1 grows from there.

Past years and projection

Grey columns are reported results from the annual reports (after-tax EBIT at the model's tax rate), so you can check the growth and margin assumptions against the past. Years 1–5 are the model.

FY2023FY2024FY2025Year 1Year 2Year 3Year 4Year 5
Revenue₩434B₩496B₩455B₩456B₩465B₩476B₩488B₩503B
Growth0.4%14.3%−8.3%1.7%2.0%2.3%2.7%3.0%
EBIT₩14B₩16B−₩1.6B₩12B₩12B₩12B₩13B₩13B
EBIT margin3.2%3.3%−0.3%2.6%2.6%2.6%2.6%2.6%
After-tax EBIT₩10B₩12B−₩1.1B₩8.6B₩8.8B₩9B₩9.2B₩9.5B
+ Depreciation———₩15B₩15B₩15B₩16B₩16B
− Capital spending₩19B₩17B₩18B₩18B₩19B₩19B₩20B₩20B
− Working capital−₩43B−₩17B₩12B₩1.8B₩2.2B₩2.5B₩3.1B₩3.5B
Free cash flow———₩3.1B₩2.9B₩2.6B₩2.2B₩2B
Discount factor———0.9310.8670.8080.7520.700
Present value———₩2.9B₩2.5B₩2.1B₩1.7B₩1.4B

Terminal value ₩104B, worth ₩73B today: 87% of enterprise value. It assumes spending settles at 110% of depreciation once growth slows to the terminal rate.

Cross-check: what the market has paid before

For cyclical businesses, analysts check a DCF against the multiples the stock has traded at through past cycles. Price / book is the usual anchor for them: P/E looks highest at the bottom of a cycle, when earnings are smallest, and lowest at the top. The price each band would give today:

LowTypicalHigh
Price / book (book value ₩39,182 a share)Now 0.23×₩9,2310.24×₩9,9900.25×₩14,1430.36×
Price / earnings (last 12 months: ₩2,966 a share)Now 3.02×₩10,0843.40×₩15,9795.39×₩35,04011.8×
P/E on run-rate earnings (Q2 2026 × 4: ₩5,045 a share)Now 1.77×₩17,1513.40×₩27,1765.39×₩59,59611.8×

Low, typical and high are the 10th percentile, middle and 90th percentile of month-end multiples since 2021, each against the latest report out by then, per share at today's share count; loss years and P/E above 100 are left out. Run-rate earnings are one quarter × 4, not a forecast. Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal.

Sensitivity

Fair value per share as two inputs change; the middle is the current case.

WACC ↓ · Terminal growth →1.0%1.5%2.0%2.5%3.0%
6.4%₩18,024₩18,073₩18,127₩18,188₩18,259
6.9%₩17,405₩17,404₩17,398₩17,384₩17,359
7.4%₩16,885₩16,851₩16,806₩16,745₩16,666
7.9%₩16,442₩16,386₩16,315₩16,227₩16,115
8.4%₩16,061₩15,990₩15,903₩15,798₩15,668

Now (TTM)

Market cap
₩143B
Enterprise value
−₩14B
P/E
3.0×
P/B
0.2×
P/S
0.3×
EV/EBITDA
—
Dividend yield
0.0%

Over time (at each year end)

20252024202320222021
Price₩9,200₩9,390₩8,680₩11,300₩13,400
Market cap₩147B₩150B₩139B₩181B₩214B
P/E31.7×3.8×8.1×12.7×4.8×
P/B0.2×0.2×0.2×0.3×0.4×
P/S0.3×0.3×0.3×0.4×0.6×
EV/EBITDA—————
Dividend yield0.0%0.0%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
Silla3.0×0.2×0.3×—0.0%
NH Nongwoobio5.5×0.4×0.7×6.3×3.7%
Dongwon Fisheries2.2×0.4×0.1×5.1×0.0%
Asia Seed—0.8×3.4×519.9×0.0%
Similar companies (median)3.9×0.4×0.7×6.3×0.0%

Calculated from end-of-day prices and filed financial statements. Not a recommendation. This is not financial advice.

Also known as: Silla / 신라교역 / 004970 / KRX:004970

Source: KRX statistical information