KOSDAQ · 025900 · Wood & Paper · ₩025900

Dongwha Enterprise동화기업

025900 · KOSDAQ · ₩025900 · 동화기업

₩5,600▼ ₩220 (3.78%)End-of-day · Oct 29, 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

With these assumptions the model gives no positive value.

Enterprise value: ₩65B
Equity value: −₩593B
WACC: 4.8%

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 ₩5,600, the model needs an operating margin of 6.1% every year (it uses 1.3%).
Margins ranged from −1.7% to 11.3% 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.

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: ₩2,091; −62.7%

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 (1.3%).

Revenue growth

Revenue growth, year 1-9%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (-9% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 2-6%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (-9% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 3-3%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (-9% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 40%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (-9% 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 (-9% a year, annual reports), fading to 3% by year 5.

Business

EBIT margin1.3%
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.
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 & amortisation5.6%
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 spending6.5%
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).
Working capital6.3%
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 rate4.08%
Yield on Korea's 10-year government bond: the return with almost no risk.
Default: Korea Treasury Bond 10-year yield on 2026-10-29.
Beta0.6
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 0.38, 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)5.58%
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): ₩873B
Net debt (borrowings and leases − cash and deposits): ₩1T
+ Stakes and investments: ₩418B; Associates, long-term financial assets and deposits (book value)
− Minority interests: ₩67B
Shares: 50,557,285
Share price: ₩5,600
Market cap: ₩283B

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	₩963B	₩918B	₩830B	₩795B	₩747B	₩725B	₩725B	₩746B
Growth	−12.5%	−4.7%	−9.6%	−9.0%	−6.0%	−3.0%	0.0%	3.0%
EBIT	−₩17B	₩17B	−₩14B	₩10B	₩9.7B	₩9.4B	₩9.4B	₩9.7B
EBIT margin	−1.7%	1.8%	−1.7%	1.3%	1.3%	1.3%	1.3%	1.3%
After-tax EBIT	−₩12B	₩12B	−₩10B	₩7.5B	₩7B	₩6.8B	₩6.8B	₩7B
+ Depreciation	₩54B	—	—	₩44B	₩42B	₩41B	₩41B	₩42B
− Capital spending	—	₩73B	₩41B	₩52B	₩49B	₩47B	₩47B	₩49B
− Working capital	−₩131B	−₩20B	−₩65B	−₩5B	−₩3B	−₩1.4B	₩0	₩1.4B
Free cash flow	—	—	—	₩5.3B	₩3.3B	₩1.7B	₩308M	−₩1.1B
Discount factor	—	—	—	0.954	0.911	0.869	0.830	0.792
Present value	—	—	—	₩5B	₩3B	₩1.5B	₩255M	−₩833M

Terminal value ₩70B, worth ₩56B today: 86% 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 ₩16,120 a share)Now 0.35×	₩7,8640.49×	₩18,5731.15×	₩38,8212.41×

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%
3.8%	—	—	—	—	—
4.3%	—	—	—	—	—
4.8%	—	—	—	—	—
5.3%	—	—	—	—	—
5.8%	—	—	—	—	—

Now (TTM)

Market cap: ₩283B
Enterprise value: ₩1.3T
P/E: —
P/B: 0.3×
P/S: 0.3×
EV/EBITDA: —
Dividend yield: 0.0%

Over time (at each year end)

	2025	2024	2023	2022	2021
Price	₩8,470	₩8,280	₩24,473	₩19,907	₩39,573
Market cap	₩428B	₩419B	₩1.2T	₩1T	₩2T
P/E	—	—	—	26.2×	50.7×
P/B	0.5×	0.5×	1.4×	1.5×	3.2×
P/S	0.5×	0.5×	1.3×	0.9×	2.1×
EV/EBITDA	—	—	53.2×	13.4×	17.1×
Dividend yield	0.0%	—	—	—	—

Versus similar companies

Company	P/E	P/B	P/S	EV/EBITDA	Dividend yield
Dongwha Enterprise	—	0.3×	0.3×	—	0.0%
SM Kukil	—	3.2×	6.1×	—	0.0%
Shindaeyang Paper	10.0×	0.5×	0.5×	—	2.8%
Asia Paper Manufacturing	10.4×	0.3×	0.3×	—	2.8%
Hansol Paper	7.4×	0.2×	0.1×	—	7.3%
Sambo Corrugated Board	4.5×	0.2×	0.2×	—	2.5%
Moorim P&P	—	0.2×	0.1×	—	8.0%
Similar companies (median)	8.7×	0.3×	0.3×	—	2.8%

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

Also known as: Dongwha Enterprise / 동화기업 / 025900 / KRX:025900

Source: KRX statistical information