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Kyeong Nam Steel

039240 · KOSDAQ · ₩039240 · 경남스틸

₩1,905▼ ₩14 (0.73%)End-of-day · Oct 29, 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

₩3,663

vs the current price (₩1,905)

Enterprise value
₩83B
Equity value
₩99B
WACC
7.4%

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 92% 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 ₩1,905, the model needs an operating margin of 1.1% every year (it uses 2.2%).
  • Today's P/E is 9.9× against a typical 11.2× 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
₩845
−55.6%
Base
₩3,663
+92.3%
Bull
₩8,960
+370.4%

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 (2.2%).

Revenue growth

  • -4.9%

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

    Default: the last 3 years' revenue growth (-4.9% a year, annual reports), fading to 3% by year 5.

  • -2.9%

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

    Default: the last 3 years' revenue growth (-4.9% a year, annual reports), fading to 3% by year 5.

  • -1%

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

    Default: the last 3 years' revenue growth (-4.9% a year, annual reports), fading to 3% by year 5.

  • 1%

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

    Default: the last 3 years' revenue growth (-4.9% 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 (-4.9% a year, annual reports), fading to 3% by year 5.

Business

  • 2.2%

    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.

  • 0.7%

    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).

  • 0.4%

    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).

  • 17.6%

    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.

  • 4.08%

    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.

  • 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 0.01, 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.

  • 5.58%

    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)
₩362B
Net debt (borrowings and leases − cash and deposits)
−₩13B
+ Stakes and investments
₩2.5B
Associates, long-term financial assets and deposits (book value)
Shares
26,979,604
Share price
₩1,905
Market cap
₩51B

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₩390B₩395B₩357B₩344B₩334B₩331B₩334B₩344B
Growth−6.0%1.3%−9.7%−4.9%−2.9%−1.0%1.0%3.0%
EBIT₩11B₩9.4B₩6B₩7.6B₩7.4B₩7.3B₩7.4B₩7.6B
EBIT margin2.7%2.4%1.7%2.2%2.2%2.2%2.2%2.2%
After-tax EBIT₩7.8B₩6.8B₩4.3B₩5.5B₩5.3B₩5.3B₩5.3B₩5.5B
+ Depreciation₩2.7B₩2.7B₩2.7B₩2.4B₩2.3B₩2.3B₩2.3B₩2.4B
− Capital spending₩1.9B₩2.5B₩277M₩1.4B₩1.3B₩1.3B₩1.3B₩1.4B
− Working capital₩11B₩1.9B−₩9.3B−₩3.1B−₩1.8B−₩588M₩583M₩1.8B
Free cash flow−₩2B₩5.2B₩16B₩9.6B₩8.1B₩6.9B₩5.8B₩4.8B
Discount factor———0.9310.8670.8080.7520.700
Present value———₩9B₩7B₩5.5B₩4.3B₩3.3B

Terminal value ₩77B, worth ₩54B today: 65% 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 ₩4,235 a share)Now 0.45×₩2,6380.62×₩3,3210.78×₩5,1901.23×
Price / earnings (last 12 months: ₩192 a share)Now 9.91×₩1,5778.20×₩2,15511.2×₩4,27422.2×
P/E on run-rate earnings (Q2 2026 × 4: ₩143 a share)Now 13.4×₩1,1698.20×₩1,59711.2×₩3,16922.2×

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%
6.4%₩4,073₩4,158₩4,260₩4,386₩4,547
6.9%₩3,808₩3,865₩3,932₩4,011₩4,110
7.4%₩3,584₩3,621₩3,663₩3,712₩3,771
7.9%₩3,393₩3,415₩3,440₩3,468₩3,501
8.4%₩3,226₩3,238₩3,251₩3,265₩3,279

Now (TTM)

Market cap
₩51B
Enterprise value
₩38B
P/E
9.9×
P/B
0.4×
P/S
0.1×
EV/EBITDA
4.5×
Dividend yield
6.3%

Over time (at each year end)

20252024202320222021
Price₩2,740₩4,545₩3,125₩2,915₩4,750
Market cap₩74B₩123B₩84B₩79B₩128B
P/E16.0×16.4×9.9×8.1×20.9×
P/B0.6×1.1×0.8×0.8×1.4×
P/S0.2×0.3×0.2×0.2×0.4×
EV/EBITDA7.8×10.9×7.1×5.9×14.6×
Dividend yield4.4%2.6%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
Kyeong Nam Steel9.9×0.4×0.1×4.5×6.3%
POSCO Holdings16.2×0.4×0.3×7.7×3.6%
Korea Zinc18.6×1.6×0.9×—2.3%
Hyundai Steel—0.2×0.2×—1.9%
Poongsan8.1×0.7×0.3×5.9×2.9%
SeAH Besteel Holdings12.2×0.5×0.3×9.5×4.0%
Sama Aluminium—4.1×3.0×—0.0%
Similar companies (median)14.2×0.6×0.3×7.7×2.6%

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

Also known as: Kyeong Nam Steel / 경남스틸 / 039240 / KRX:039240

Source: KRX statistical information