Ask Warren

ES Tsoft

047560 · KOSDAQ · ₩047560 · 이스트소프트

₩6,200▼ ₩460 (6.91%)End-of-day · Oct 29, 2026 · End-of-day prices.
Trade
Alert me
SellBuy

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
−₩189B
Equity value
−₩178B
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 gives no positive value at these assumptions. What we can see:

  • To match today's price of ₩6,200, the model needs an operating margin of 3.5% every year (it uses −11.0%).
  • Margins ranged from −17.7% to 11.2% 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.
  • 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.

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
—

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 (−11.0%).

Revenue growth

  • 6.4%

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

    Default: the last 3 years' revenue growth (6.4% a year, annual reports), fading to 3% by year 5.

  • 5.5%

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

    Default: the last 3 years' revenue growth (6.4% a year, annual reports), fading to 3% by year 5.

  • 4.7%

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

    Default: the last 3 years' revenue growth (6.4% a year, annual reports), fading to 3% by year 5.

  • 3.8%

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

    Default: the last 3 years' revenue growth (6.4% 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 (6.4% a year, annual reports), fading to 3% by year 5.

Business

  • -11%

    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.

  • 2.9%

    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).

  • 2.9%

    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).

  • -10%

    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 0.21, 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)
₩111B
Net debt (borrowings and leases − cash and deposits)
−₩23B
+ Stakes and investments
₩355M
Associates, long-term financial assets and deposits (book value)
− Minority interests
₩12B
Shares
11,753,082
Share price
₩6,200
Market cap
₩73B

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₩92B₩102B₩107B₩118B₩125B₩131B₩136B₩140B
Growth4.2%10.8%4.2%6.4%5.5%4.7%3.8%3.0%
EBIT−₩8.9B−₩13B−₩19B−₩13B−₩14B−₩14B−₩15B−₩15B
EBIT margin−9.6%−13.1%−17.7%−11.0%−11.0%−11.0%−11.0%−11.0%
After-tax EBIT−₩6.5B−₩9.8B−₩14B−₩9.4B−₩9.9B−₩10B−₩11B−₩11B
+ Depreciation₩2.8B₩2.9B₩3.2B₩3.4B₩3.6B₩3.8B₩3.9B₩4B
− Capital spending₩2.3B₩3B₩3.3B₩3.4B₩3.6B₩3.8B₩3.9B₩4B
− Working capital−₩62B₩11B₩1B−₩711M−₩650M−₩586M−₩496M−₩407M
Free cash flow₩56B−₩21B−₩15B−₩8.7B−₩9.3B−₩9.8B−₩10B−₩11B
Discount factor———0.9310.8670.8080.7520.700
Present value———−₩8.1B−₩8.1B−₩7.9B−₩7.8B−₩7.5B

Terminal value −₩213B, worth −₩149B today: 79% 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 ₩4,449 a share)Now 1.39×₩7,7991.75×₩14,0583.16×₩17,4303.92×

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%—————
6.9%—————
7.4%—————
7.9%—————
8.4%—————

Now (TTM)

Market cap
₩73B
Enterprise value
₩48B
P/E
—
P/B
1.4×
P/S
0.7×
EV/EBITDA
—
Dividend yield
0.0%

Over time (at each year end)

20252024202320222021
Price₩16,730₩23,150₩14,780₩8,800₩18,100
Market cap₩197B₩272B₩174B₩103B₩213B
P/E————45.2×
P/B3.9×4.0×2.4×2.0×3.4×
P/S1.8×2.7×1.9×1.2×2.4×
EV/EBITDA————15.4×
Dividend yield0.0%————

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
ES Tsoft—1.4×0.7×—0.0%
Hyundai Autoever47.8×4.8×2.0×—0.6%
Krafton10.0×1.2×1.9×—1.2%
NC7.0×1.2×2.1×8.4×0.6%
Netmarble7.1×0.5×1.0×—2.6%
PearlAbyss8.0×2.1×3.0×5.2×0.0%
Shift UP9.0×1.8×7.2×—0.0%
Similar companies (median)8.5×1.5×2.0×6.8×0.6%

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

Also known as: ES Tsoft / 이스트소프트 / 047560 / KRX:047560

Source: KRX statistical information