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Korea Petro Chemical IND

006650 · KOSPI · ₩006650 · 대한유화

₩80,300▲ ₩700 (0.88%)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
−₩419B
Equity value
−₩671B
WACC
7.9%

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 ₩80,300, the model needs an operating margin of 2.2% every year (it uses 0.2%).
  • Analysts' forecasts for 2026: revenue ₩3.2T, operating profit — (1 broker). The model starts from the last 12 months reported.
  • Analysts' forecasts for 2027: revenue ₩3.7T, operating profit — (1 broker). The model starts from the last 12 months reported.
  • Margins ranged from −9.7% to 7.1% 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
₩126,947
+58.1%

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 (0.2%).

Revenue growth

  • 14.6%

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

    Default: the last 3 years' revenue growth (14.6% a year, annual reports), fading to 3% by year 5.

  • 11.7%

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

    Default: the last 3 years' revenue growth (14.6% a year, annual reports), fading to 3% by year 5.

  • 8.8%

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

    Default: the last 3 years' revenue growth (14.6% a year, annual reports), fading to 3% by year 5.

  • 5.9%

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

    Default: the last 3 years' revenue growth (14.6% 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 (14.6% a year, annual reports), fading to 3% by year 5.

Business

  • 0.2%

    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.

  • 2.4%

    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).

  • 3%

    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).

  • 9.6%

    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.

  • 0.79

    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 0.68, 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)
₩3.6T
Net debt (borrowings and leases − cash and deposits)
₩76B
+ Stakes and investments
₩78B
Associates, long-term financial assets and deposits (book value)
− Minority interests
₩255B
Shares
6,500,000
Share price
₩80,300
Market cap
₩522B

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₩2.5T₩2.8T₩3.3T₩4.1T₩4.6T₩5T₩5.3T₩5.4T
Growth12.5%12.0%19.6%14.6%11.7%8.8%5.9%3.0%
EBIT−₩62B−₩60B₩53B₩8.2B₩9.1B₩9.9B₩11B₩11B
EBIT margin−2.5%−2.1%1.6%0.2%0.2%0.2%0.2%0.2%
After-tax EBIT−₩45B−₩43B₩38B₩5.9B₩6.6B₩7.2B₩7.6B₩7.8B
+ Depreciation———₩98B₩109B₩119B₩126B₩130B
− Capital spending₩115B₩59B₩78B₩122B₩137B₩149B₩158B₩162B
− Working capital₩59B₩18B−₩47B₩50B₩46B₩39B₩28B₩15B
Free cash flow———−₩69B−₩67B−₩61B−₩52B−₩40B
Discount factor———0.9270.8590.7960.7380.684
Present value———−₩63B−₩57B−₩49B−₩38B−₩27B

Terminal value −₩269B, worth −₩184B today: 44% 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 ₩288,634 a share)Now 0.28×₩87,2310.30×₩136,3980.47×₩167,8090.58×

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%
6.9%—————
7.4%—————
7.9%—————
8.4%—————
8.9%—————

Now (TTM)

Market cap
₩522B
Enterprise value
₩572B
P/E
7.1×
P/B
0.3×
P/S
0.1×
EV/EBITDA
—
Dividend yield
1.6%

Over time (at each year end)

20252024202320222021
Price₩144,800₩77,700₩153,000₩171,500₩183,000
Market cap₩941B₩505B₩995B₩1.1T₩1.2T
P/E29.7×———7.9×
P/B0.5×0.3×0.5×0.6×0.6×
P/S0.3×0.2×0.4×0.5×0.5×
EV/EBITDA—————
Dividend yield0.9%1.3%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
Korea Petro Chemical IND7.1×0.3×0.1×—1.6%
LG Chem—0.5×0.3×—0.8%
Hanwha Solutions—0.6×0.4×—0.0%
Hanwha6.3×0.4×0.1×—1.4%
SKC—2.1×2.0×—0.0%
KCC0.9×0.3×0.5×8.9×0.0%
Kumho Petro Chemical5.3×0.4×0.4×—1.6%
Similar companies (median)5.3×0.4×0.4×8.9×0.4%

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

Also known as: Korea Petro Chemical IND / 대한유화 / 006650 / KRX:006650

Source: KRX statistical information