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Dongkuk Industries

005160 · KOSDAQ · ₩005160 · 동국산업

₩3,645▼ ₩135 (3.57%)End-of-day · Oct 28, 2026 · End-of-day prices.
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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

With these assumptions the model gives no positive value.

Enterprise value
−₩132B
Equity value
−₩446B
WACC
5.6%

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 gives no positive value at these assumptions. What we can see:

  • To match today's price of ₩3,645, the model needs an operating margin of 5.7% every year (it uses 0.1%).
  • Margins ranged from −3.6% to 4.8% over the last 5 years, so this is a cyclical business. The model uses the average; the price may be set by where the cycle is now. Try the margin fade option.
  • In the projection, spending on equipment, software and working capital takes most or all of the after-tax operating profit, so free cash flow is thin. Companies that invest heavily often look like this until spending slows.

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
—
Base
—
Bull
—

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

Assumptions

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Cycle options

Margin path

Every year uses the cycle-average margin (0.1%).

Revenue growth

  • -5.4%

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

    Default: the last 3 years' revenue growth (-5.4% a year, annual reports), fading to 3% by year 5.

  • -3.3%

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

    Default: the last 3 years' revenue growth (-5.4% a year, annual reports), fading to 3% by year 5.

  • -1.2%

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

    Default: the last 3 years' revenue growth (-5.4% a year, annual reports), fading to 3% by year 5.

  • 0.9%

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

    Default: the last 3 years' revenue growth (-5.4% 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 (-5.4% a year, annual reports), fading to 3% by year 5.

Business

  • 0.1%

    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.

  • 2.5%

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

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

  • 4%

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

    Default: not in the statements, so a typical level.

  • 31.5%

    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.

  • 4.11%

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

    Default: Korea Treasury Bond 10-year yield on 2026-10-28.

  • 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 0.28, 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.

  • 5.61%

    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)
₩658B
Net debt (borrowings and leases − cash and deposits)
₩233B
+ Stakes and investments
₩11B
Associates, long-term financial assets and deposits (book value)
− Minority interests
₩92B
Shares
54,244,482
Share price
₩3,645
Market cap
₩198B

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₩757B₩790B₩728B₩623B₩602B₩595B₩600B₩618B
Growth−12.0%4.4%−7.9%−5.4%−3.3%−1.2%0.9%3.0%
EBIT−₩27B₩12B₩7B₩623M₩602M₩595M₩600M₩618M
EBIT margin−3.6%1.5%1.0%0.1%0.1%0.1%0.1%0.1%
After-tax EBIT−₩20B₩8.7B₩5.1B₩451M₩436M₩431M₩435M₩448M
+ Depreciation₩20B₩16B₩20B₩16B₩15B₩15B₩15B₩15B
− Capital spending———₩25B₩24B₩24B₩24B₩25B
− Working capital−₩44B₩45B−₩68B−₩11B−₩6.5B−₩2.3B₩1.7B₩5.7B
Free cash flow———₩2.3B−₩2.1B−₩6.2B−₩10B−₩14B
Discount factor———0.9470.8970.8490.8040.761
Present value———₩2.2B−₩1.9B−₩5.3B−₩8.2B−₩11B

Terminal value −₩141B, worth −₩108B today: 82% 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 ₩6,469 a share)Now 0.56×₩2,6790.41×₩3,5550.55×₩6,1200.95×

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%
4.6%—————
5.1%—————
5.6%—————
6.1%—————
6.6%—————

Now (TTM)

Market cap
₩198B
Enterprise value
₩430B
P/E
—
P/B
0.6×
P/S
0.3×
EV/EBITDA
53.0×
Dividend yield
4.0%

Over time (at each year end)

20252024202320222021
Price₩2,730₩4,430₩4,815₩3,665₩3,545
Market cap₩148B₩240B₩261B₩199B₩192B
P/E———30.8×9.8×
P/B0.4×0.6×0.7×0.5×0.5×
P/S0.2×0.3×0.3×0.2×0.3×
EV/EBITDA13.7×18.5×—14.7×4.0×
Dividend yield5.3%2.9%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
Dongkuk Industries—0.6×0.3×53.0×4.0%
POSCO Holdings16.6×0.4×0.3×7.8×3.5%
Korea Zinc18.9×1.6×0.9×—2.2%
Hyundai Steel—0.2×0.2×—1.9%
Poongsan8.3×0.7×0.3×6.0×2.8%
SeAH Besteel Holdings12.6×0.6×0.3×9.6×3.8%
Sama Aluminium—4.3×3.2×—0.0%
Similar companies (median)14.6×0.6×0.3×7.8×2.5%

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

Also known as: Dongkuk Industries / 동국산업 / 005160 / KRX:005160

Source: KRX statistical information