Ask Warren

TKG Huchems

069260 · KOSPI · ₩069260 · TKG휴켐스

₩15,090▲ ₩60 (0.40%)End-of-day · Oct 30, 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

₩29,068

vs the current price (₩15,090)

Enterprise value
₩1.1T
Equity value
₩1.2T
WACC
7.3%

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 93% 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 ₩15,090, the model needs an operating margin of 4.7% every year (it uses 8.3%).
  • Or revenue growth −19.6 points a year higher than assumed in each of the 5 years.
  • Today's P/E is 9.6× against a typical 9.6× 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
₩16,536
+9.6%
Base
₩29,068
+92.6%
Bull
₩50,953
+237.7%

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 (8.3%).

Revenue growth

  • -3%

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

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

  • -1.5%

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

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

  • -0%

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

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

  • 1.5%

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

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

Business

  • 8.3%

    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.

  • 3.4%

    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).

  • 4.9%

    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).

  • 18.4%

    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.

  • 4.01%

    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.

  • 0.6

    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 0.08, 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.

  • 5.51%

    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)
₩1.3T
Net debt (borrowings and leases − cash and deposits)
−₩44B
+ Stakes and investments
₩19B
Associates, long-term financial assets and deposits (book value)
− Minority interests
₩4.5B
Shares
40,878,588
Share price
₩15,090
Market cap
₩617B

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₩1.1T₩1.2T₩1.1T₩1.2T₩1.2T₩1.2T₩1.2T₩1.3T
Growth−14.8%12.9%−5.1%−3.0%−1.5%0.0%1.5%3.0%
EBIT₩121B₩81B₩66B₩101B₩100B₩100B₩101B₩104B
EBIT margin11.5%6.8%5.8%8.3%8.3%8.3%8.3%8.3%
After-tax EBIT₩88B₩59B₩48B₩74B₩72B₩72B₩74B₩76B
+ Depreciation₩23B₩44B₩49B₩42B₩41B₩41B₩42B₩43B
− Capital spending₩114B₩33B₩12B₩60B₩59B₩59B₩60B₩62B
− Working capital−₩75B−₩27B−₩117B−₩7B−₩3.4B₩0₩3.3B₩6.7B
Free cash flow₩72B₩98B₩201B₩62B₩58B₩54B₩52B₩50B
Discount factor———0.9320.8680.8090.7540.703
Present value———₩58B₩50B₩44B₩39B₩35B

Terminal value ₩1.3T, worth ₩903B today: 80% 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 ₩22,987 a share)Now 0.66×₩17,3970.76×₩22,4630.98×₩29,6071.29×
Price / earnings (last 12 months: ₩1,577 a share)Now 9.57×₩10,8706.89×₩15,0909.57×₩19,36012.3×
P/E on run-rate earnings (Q2 2026 × 4: ₩2,293 a share)Now 6.58×₩15,8016.89×₩21,9369.57×₩28,14412.3×

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%
6.3%₩30,839₩32,993₩35,643₩38,983₩43,327
6.8%₩28,222₩29,941₩32,012₩34,560₩37,772
7.3%₩26,023₩27,416₩29,068₩31,060₩33,509
7.8%₩24,149₩25,294₩26,633₩28,220₩30,134
8.3%₩22,534₩23,486₩24,586₩25,872₩27,397

Now (TTM)

Market cap
₩617B
Enterprise value
₩573B
P/E
9.6×
P/B
0.7×
P/S
0.5×
EV/EBITDA
4.5×
Dividend yield
6.6%

Over time (at each year end)

20252024202320222021
Price₩18,940₩17,050₩21,500₩20,000₩23,150
Market cap₩774B₩697B₩879B₩818B₩946B
P/E12.9×9.0×6.5×10.0×13.0×
P/B0.9×0.8×1.0×1.1×1.4×
P/S0.7×0.6×0.8×0.7×1.1×
EV/EBITDA5.6×5.8×5.7×5.7×7.8×
Dividend yield5.3%5.9%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
TKG Huchems9.6×0.7×0.5×4.5×6.6%
LG Chem—0.5×0.3×—0.9%
Hanwha Solutions—0.5×0.3×—0.0%
Hanwha5.9×0.4×0.1×—1.5%
SKC—1.8×1.7×—0.0%
KCC0.9×0.3×0.5×8.9×0.0%
Kumho Petro Chemical5.3×0.4×0.4×—1.6%
Similar companies (median)5.3×0.4×0.4×8.9×0.4%

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

Also known as: TKG Huchems / TKG휴켐스 / 069260 / KRX:069260

Source: KRX statistical information