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Korea Steel

007280 · KOSPI · ₩007280 · 한국특강

₩2,115▲ ₩55 (2.67%)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

₩9,182

vs the current price (₩2,115)

Enterprise value
₩477B
Equity value
₩263B
WACC
4.9%

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 is 334% 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 ₩2,115, the model needs an operating margin of 2.1% every year (it uses 3.1%).
  • Or revenue growth −17.7 points a year higher than assumed in each of the 5 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
—
Base
₩9,182
+334.2%
Bull
₩44,869
+2,021.5%

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 (3.1%).

Revenue growth

  • -1.2%

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

    Default: the last 3 years' revenue growth (-1.2% a year, annual reports), fading to 3% by year 5.

  • -0.2%

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

    Default: the last 3 years' revenue growth (-1.2% 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 (-1.2% a year, annual reports), fading to 3% by year 5.

  • 1.9%

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

    Default: the last 3 years' revenue growth (-1.2% 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 (-1.2% a year, annual reports), fading to 3% by year 5.

Business

  • 3.1%

    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.

  • 1.4%

    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).

  • 1.8%

    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).

  • 17.4%

    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.

  • 0.72

    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 0.59, 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)
₩832B
Net debt (borrowings and leases − cash and deposits)
₩214B
Shares
28,646,540
Share price
₩2,115
Market cap
₩61B

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₩830B₩769B₩767B₩822B₩820B₩828B₩843B₩869B
Growth4.3%−7.4%−0.2%−1.2%−0.2%0.9%1.9%3.0%
EBIT₩47B₩11B₩12B₩25B₩25B₩26B₩26B₩27B
EBIT margin5.7%1.4%1.5%3.1%3.1%3.1%3.1%3.1%
After-tax EBIT₩34B₩7.7B₩8.5B₩18B₩18B₩19B₩19B₩20B
+ Depreciation———₩12B₩11B₩12B₩12B₩12B
− Capital spending₩25B₩10B₩7.8B₩15B₩15B₩15B₩15B₩16B
− Working capital₩27B−₩16B₩18B−₩1.7B−₩286M₩1.3B₩2.7B₩4.4B
Free cash flow———₩17B₩15B₩14B₩13B₩12B
Discount factor———0.9530.9080.8650.8240.785
Present value———₩16B₩14B₩12B₩11B₩9.1B

Terminal value ₩529B, worth ₩415B 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 ₩7,180 a share)Now 0.29×₩2,6010.36×₩3,2500.45×₩8,6241.20×
P/E on run-rate earnings (Q2 2026 × 4: ₩403 a share)Now 5.24×₩1,1582.87×₩1,6144.00×₩7,97419.8×

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%
3.9%₩11,290₩13,865₩17,749₩24,298₩37,721
4.4%₩8,528₩10,218₩12,591₩16,169₩22,201
4.9%₩6,466₩7,631₩9,182₩11,359₩14,642
5.4%₩4,870₩5,699₩6,763₩8,180₩10,168
5.9%₩3,597₩4,202₩4,956₩5,923₩7,211

Now (TTM)

Market cap
₩61B
Enterprise value
₩275B
P/E
—
P/B
0.3×
P/S
0.1×
EV/EBITDA
—
Dividend yield
18.9%

Over time (at each year end)

20252024202320222021
Price₩2,952₩3,372₩3,596₩3,893₩6,835
Market cap₩85B₩97B₩103B₩112B₩196B
P/E28.3×—3.7×2.7×5.3×
P/B0.4×0.4×0.5×0.6×1.4×
P/S0.1×0.1×0.1×0.1×0.3×
EV/EBITDA—————
Dividend yield13.6%————

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
Korea Steel—0.3×0.1×—18.9%
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: Korea Steel / 한국특강 / 007280 / KRX:007280

Source: KRX statistical information