KOSDAQ · 011040 · Biotech & Pharma · ₩011040

Kyungdong Pharm경동제약

011040 · KOSDAQ · ₩011040 · 경동제약

₩4,850▼ ₩65 (1.32%)End-of-day · Oct 30, 2026 · End-of-day prices.

Trade

Sell Buy

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

₩1,661

vs the current price (₩4,850)

Enterprise value: ₩49B
Equity value: ₩51B
WACC: 7.1%

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 66% 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 ₩4,850, the model needs an operating margin of 7.1% every year (it uses 3.9%).
Or revenue growth +39.7 points a year higher than assumed in each of the 5 years.
Margins ranged from −15.3% to 8.9% 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.
52% 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.
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.
Today's P/E is 8.4× against a typical 25.0× 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: —
Base: ₩1,661; −65.7%
Bull: ₩5,368; +10.7%

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

Assumptions

Cycle options

Margin path

Every year uses the cycle-average margin (3.9%).

Revenue growth

Revenue growth, year 12.4%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (2.4% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 22.6%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (2.4% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 32.7%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (2.4% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 42.9%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (2.4% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 53%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (2.4% a year, annual reports), fading to 3% by year 5.

Business

EBIT margin3.9%
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.
Tax rate27.5%
Share of operating profit paid as corporate tax.
Default: Korea's top corporate tax rate (25%) plus 10% local income tax.
Depreciation & amortisation2.5%
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).
Capital spending7.2%
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).
Working capital21.9%
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

Terminal growth2%
How fast cash flows keep growing every year after year 5.
Default: about Korea's long-run inflation plus real growth.
Risk-free rate4.01%
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.
Beta0.6
How much the share moves when the market moves: 1 means just like the market.
Default: 104 weeks of weekly returns against KOSPI (official index); raw beta 0.09, adjusted toward 1 and kept between 0.6 and 2.0.
Equity risk premium5.5%
The extra return investors want for owning shares instead of bonds.
Default: a typical premium for Korean shares.
Cost of debt (before tax)5.51%
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): ₩201B
Net debt (borrowings and leases − cash and deposits): ₩13B
+ Stakes and investments: ₩15B; Associates, long-term financial assets and deposits (book value)
− Minority interests: ₩223M
Shares: 30,768,766
Share price: ₩4,850
Market cap: ₩149B

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.

	FY2023	FY2024	FY2025	Year 1	Year 2	Year 3	Year 4	Year 5
Revenue	₩163B	₩194B	₩196B	₩206B	₩211B	₩217B	₩223B	₩230B
Growth	−11.0%	19.2%	1.2%	2.4%	2.6%	2.7%	2.9%	3.0%
EBIT	−₩25B	₩2.6B	₩7.7B	₩8B	₩8.2B	₩8.5B	₩8.7B	₩9B
EBIT margin	−15.3%	1.4%	3.9%	3.9%	3.9%	3.9%	3.9%	3.9%
After-tax EBIT	−₩18B	₩1.9B	₩5.6B	₩5.8B	₩6B	₩6.1B	₩6.3B	₩6.5B
+ Depreciation	₩5.2B	₩4.9B	₩3.2B	₩5.1B	₩5.3B	₩5.4B	₩5.6B	₩5.7B
− Capital spending	₩8.5B	₩12B	₩21B	₩15B	₩15B	₩16B	₩16B	₩17B
− Working capital	−₩28B	₩12B	−₩4.9B	₩1.1B	₩1.2B	₩1.2B	₩1.4B	₩1.5B
Free cash flow	₩7.1B	−₩17B	−₩6.8B	−₩4.9B	−₩5.1B	−₩5.3B	−₩5.6B	−₩5.8B
Discount factor	—	—	—	0.934	0.873	0.815	0.761	0.711
Present value	—	—	—	−₩4.6B	−₩4.5B	−₩4.3B	−₩4.2B	−₩4.1B

Terminal value ₩99B, worth ₩71B today: 144% 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:

	Low	Typical	High
Price / book (book value ₩7,519 a share)Now 0.65×	₩5,5320.74×	₩6,4410.86×	₩9,1721.22×
Price / earnings (last 12 months: ₩580 a share)Now 8.37×	₩7,63313.2×	₩14,49325.0×	₩21,54237.2×
P/E on run-rate earnings (Q2 2026 × 4: ₩752 a share)Now 6.45×	₩9,90113.2×	₩18,79825.0×	₩27,94137.2×

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%
6.1%	₩1,972	₩2,139	₩2,346	₩2,609	₩2,957
6.6%	₩1,690	₩1,814	₩1,964	₩2,150	₩2,386
7.1%	₩1,457	₩1,550	₩1,661	₩1,795	₩1,960
7.6%	₩1,262	₩1,333	₩1,416	₩1,513	₩1,631
8.1%	₩1,098	₩1,152	₩1,213	₩1,285	₩1,371

Now (TTM)

Market cap: ₩149B
Enterprise value: ₩161B
P/E: 8.4×
P/B: 0.6×
P/S: 0.7×
EV/EBITDA: 10.7×
Dividend yield: 6.2%

Over time (at each year end)

	2025	2024	2023	2022	2021
Price	₩5,840	₩6,130	₩6,610	₩7,870	₩11,450
Market cap	₩180B	₩189B	₩203B	₩242B	₩352B
P/E	21.1×	34.5×	—	19.9×	27.8×
P/B	0.8×	0.9×	0.9×	0.9×	1.4×
P/S	0.9×	1.0×	1.3×	1.3×	2.0×
EV/EBITDA	17.7×	28.2×	—	18.7×	15.7×
Dividend yield	5.1%	4.9%	—	—	—

Versus similar companies

Company	P/E	P/B	P/S	EV/EBITDA	Dividend yield
Kyungdong Pharm	8.4×	0.6×	0.7×	10.7×	6.2%
Samsung Biologics	34.7×	8.2×	15.1×	—	0.0%
Celltrion	28.2×	2.5×	9.1×	—	0.0%
Alteogen	76.3×	27.5×	58.0×	—	0.1%
SK biopharmaceuticals	15.2×	6.0×	7.1×	—	0.0%
Yuhan	23.3×	2.3×	2.4×	30.4×	0.8%
HLB	—	15.5×	54.7×	—	0.0%
Similar companies (median)	28.2×	7.1×	12.1×	30.4×	0.0%

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

Also known as: Kyungdong Pharm / 경동제약 / 011040 / KRX:011040

Source: KRX statistical information