Nam Hwa Construction남화토건

Namhwa Construction shows a profitable trailing half-year on lower revenue reliance, but its shares have fallen 18% in a month and free cash flow is negative.

Namhwa Construction, a KOSDAQ-listed Korean civil engineering and building contractor, reported trailing revenue of about ₩79.7B and net income of about ₩11.0B to H1 2026, with an operating margin of 5% and a net margin of 13.8%. The shares closed at ₩4,840 on 23 October 2026, a market cap of about ₩56.8B, and are well below their 52-week high of ₩12,190 though up 21.9% over one year.

What stands out

• Trailing net income (₩11.0B) is well above operating income (₩4.0B), so the profit is not coming only from core operations; the data does not explain the source of the gap.
• Free cash flow is negative at about -₩5.6B on the trailing figures, while the company holds ₩9.9B of cash against ₩1.1B of borrowings.
• Revenue was ₩72.7B in 2025, up 28.3%, after falls in 2023 and 2024, and operating margin returned to 5.2% after losses in 2023 and 2024.
• The DCF-based fair value model gives a base of ₩2,741 against the current ₩4,840, with a bear case of ₩1,205 and bull case of ₩5,386; these are model outputs, not forecasts.
• Foreign ownership fell from 5.6% to 2.3% over 60 days, and the 20-day investor flows show net retail selling of about ₩718M against net foreign buying.

What to watch

• The next full-year and quarterly results, to see whether margins and the negative free cash flow persist.
• Further filings on major sales or supply contracts, the change of largest shareholder and the debt guarantee for another party, which the amendments and filings list points to.
• The data contains no news headlines, so the reasons for the recent share price drop are not explained here.