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HDC Hyundai Engineering Plastics

089470 · KOSPI · ₩089470 · HDC현대EP

₩3,690▲ ₩40 (1.10%)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

₩13,454

vs the current price (₩3,690)

Enterprise value
₩384B
Equity value
₩429B
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 265% 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 ₩3,690, the model needs an operating margin of 1.3% every year (it uses 3.6%).
  • Today's P/E is 3.7× against a typical 6.5× 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
₩4,970
+34.7%
Base
₩13,454
+264.6%
Bull
₩29,037
+686.9%

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 (3.6%).

Revenue growth

  • -1.7%

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

    Default: the last 3 years' revenue growth (-1.7% a year, annual reports), fading to 3% by year 5.

  • -0.5%

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

    Default: the last 3 years' revenue growth (-1.7% a year, annual reports), fading to 3% by year 5.

  • 0.6%

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

    Default: the last 3 years' revenue growth (-1.7% a year, annual reports), fading to 3% by year 5.

  • 1.8%

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

    Default: the last 3 years' revenue growth (-1.7% 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 (-1.7% a year, annual reports), fading to 3% by year 5.

Business

  • 3.6%

    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.

  • 1.3%

    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).

  • 1.6%

    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).

  • 20.8%

    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 0.27, 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)
−₩43B
+ Stakes and investments
₩2.7B
Associates, long-term financial assets and deposits (book value)
Shares
31,900,000
Share price
₩3,690
Market cap
₩118B

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₩1T₩991B₩993B₩1T₩1T₩1T₩1T₩1.1T
Growth−3.6%−1.7%0.2%−1.7%−0.5%0.6%1.8%3.0%
EBIT₩33B₩33B₩50B₩37B₩36B₩37B₩37B₩38B
EBIT margin3.3%3.3%5.0%3.6%3.6%3.6%3.6%3.6%
After-tax EBIT₩24B₩24B₩36B₩27B₩26B₩27B₩27B₩28B
+ Depreciation———₩13B₩13B₩13B₩13B₩14B
− Capital spending₩10B₩27B₩10B₩16B₩16B₩16B₩17B₩17B
− Working capital−₩25B₩20B₩15B−₩3.7B−₩1.1B₩1.3B₩3.8B₩6.5B
Free cash flow———₩27B₩24B₩22B₩20B₩18B
Discount factor———0.9310.8670.8070.7510.700
Present value———₩25B₩21B₩18B₩15B₩13B

Terminal value ₩416B, worth ₩291B today: 76% 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 ₩11,649 a share)Now 0.32×₩3,9790.34×₩4,8710.42×₩5,8550.50×
Price / earnings (last 12 months: ₩1,011 a share)Now 3.65×₩4,3414.29×₩6,5796.51×₩14,78414.6×
P/E on run-rate earnings (Q2 2026 × 4: ₩1,124 a share)Now 3.28×₩4,8254.29×₩7,3136.51×₩16,43314.6×

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%₩14,825₩15,415₩16,134₩17,030₩18,182
6.9%₩13,684₩14,128₩14,657₩15,301₩16,103
7.4%₩12,722₩13,059₩13,454₩13,924₩14,495
7.9%₩11,900₩12,157₩12,454₩12,801₩13,214
8.4%₩11,190₩11,386₩11,610₩11,868₩12,169

Now (TTM)

Market cap
₩118B
Enterprise value
₩73B
P/E
3.7×
P/B
0.3×
P/S
0.1×
EV/EBITDA
—
Dividend yield
4.3%

Over time (at each year end)

20252024202320222021
Price₩4,290₩3,545₩4,560₩3,955₩5,950
Market cap₩137B₩113B₩145B₩126B₩190B
P/E4.1×7.1×6.8×11.0×18.5×
P/B0.4×0.3×0.5×0.4×0.6×
P/S0.1×0.1×0.1×0.1×0.2×
EV/EBITDA—————
Dividend yield3.7%3.9%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
HDC Hyundai Engineering Plastics3.7×0.3×0.1×—4.3%
LG Chem—0.5×0.3×—0.9%
Hanwha Solutions—0.6×0.4×—0.0%
Hanwha6.2×0.4×0.1×—1.4%
SKC—2.1×2.0×—0.0%
KCC0.9×0.3×0.5×8.7×0.0%
Kumho Petro Chemical5.2×0.4×0.4×—1.6%
Similar companies (median)5.2×0.4×0.4×8.7×0.4%

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

Also known as: HDC Hyundai Engineering Plastics / HDC현대EP / 089470 / KRX:089470

Source: KRX statistical information