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Kukdong Oil & Chemicals

014530 · KOSPI · ₩014530 · 극동유화

₩3,285▼ ₩10 (0.30%)End-of-day · Oct 27, 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

₩4,999

vs the current price (₩3,285)

Enterprise value
₩390B
Equity value
₩174B
WACC
5.1%

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 52% 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 ₩3,285, the model needs an operating margin of 2.0% every year (it uses 2.3%).
  • Or revenue growth −3.8 points a year higher than assumed in each of the 5 years.
  • Today's P/E is 10.2× against a typical 11.0× 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
₩4,999
+52.2%
Bull
₩32,966
+903.5%

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 (2.3%).

Revenue growth

  • -6.3%

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

    Default: the last 3 years' revenue growth (-6.3% a year, annual reports), fading to 3% by year 5.

  • -4%

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

    Default: the last 3 years' revenue growth (-6.3% a year, annual reports), fading to 3% by year 5.

  • -1.7%

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

    Default: the last 3 years' revenue growth (-6.3% a year, annual reports), fading to 3% by year 5.

  • 0.7%

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

    Default: the last 3 years' revenue growth (-6.3% 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 (-6.3% a year, annual reports), fading to 3% by year 5.

Business

  • 2.3%

    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%

    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).

  • 2.5%

    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).

  • 3.9%

    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

  • 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 -0.15, 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)
₩1T
Net debt (borrowings and leases − cash and deposits)
₩254B
+ Stakes and investments
₩66B
Associates, long-term financial assets and deposits (book value)
− Minority interests
₩28B
Shares
34,869,420
Share price
₩3,285
Market cap
₩115B

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₩1.2T₩1.1T₩1T₩975B₩936B₩920B₩926B₩954B
Growth−6.8%−8.2%−3.9%−6.3%−4.0%−1.7%0.7%3.0%
EBIT₩28B₩23B₩15B₩22B₩22B₩21B₩21B₩22B
EBIT margin2.4%2.2%1.5%2.3%2.3%2.3%2.3%2.3%
After-tax EBIT₩20B₩17B₩11B₩16B₩16B₩15B₩15B₩16B
+ Depreciation———₩19B₩19B₩18B₩19B₩19B
− Capital spending₩14B₩41B₩24B₩24B₩23B₩23B₩23B₩24B
− Working capital₩1.2B−₩77B₩181B−₩2.6B−₩1.5B−₩621M₩251M₩1.1B
Free cash flow———₩14B₩12B₩11B₩11B₩10B
Discount factor———0.9510.9050.8610.8190.780
Present value———₩13B₩11B₩9.8B₩8.7B₩7.8B

Terminal value ₩436B, worth ₩340B 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 ₩6,026 a share)Now 0.55×₩3,3830.56×₩3,9000.65×₩4,7010.78×
Price / earnings (last 12 months: ₩321 a share)Now 10.2×₩2,0556.40×₩3,52411.0×₩14,50345.1×
P/E on run-rate earnings (Q2 2026 × 4: ₩903 a share)Now 3.64×₩5,7756.40×₩9,90311.0×₩40,75345.1×

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%
4.1%₩5,698₩7,585₩10,366₩14,876₩23,463
4.6%₩4,025₩5,344₩7,167₩9,854₩14,213
5.1%₩2,760₩3,725₩4,999₩6,761₩9,358
5.6%₩1,770₩2,501₩3,433₩4,664₩6,367
6.1%₩975₩1,544₩2,249₩3,150₩4,339

Now (TTM)

Market cap
₩115B
Enterprise value
₩359B
P/E
10.2×
P/B
0.5×
P/S
0.1×
EV/EBITDA
—
Dividend yield
6.1%

Over time (at each year end)

20252024202320222021
Price₩3,250₩3,580₩4,340₩3,630₩3,950
Market cap₩113B₩125B₩151B₩127B₩138B
P/E99.9×13.9×10.2×6.3×12.1×
P/B0.6×0.6×0.7×0.6×0.8×
P/S0.1×0.1×0.1×0.1×0.1×
EV/EBITDA—————
Dividend yield6.2%5.6%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
Kukdong Oil & Chemicals10.2×0.5×0.1×—6.1%
SK Innovation—0.9×0.3×—0.0%
S-Oil9.3×1.4×0.4×—0.3%
Hankook Shell Oil13.4×5.6×2.0×—0.0%
Michang Oil IND1.7×0.4×0.5×—3.0%
Similar companies (median)9.3×1.2×0.4×—0.1%

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

Also known as: Kukdong Oil & Chemicals / 극동유화 / 014530 / KRX:014530

Source: KRX statistical information