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Hojeon

111110 · KOSPI · ₩111110 · 호전실업

₩5,950▼ ₩70 (1.16%)End-of-day · Oct 28, 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

₩41,868

vs the current price (₩5,950)

Enterprise value
₩345B
Equity value
₩380B
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 604% 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 ₩5,950, the model needs an operating margin of 1.7% every year (it uses 6.3%).
  • Today's P/E is 2.7× against a typical 4.0× 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
₩21,733
+265.3%
Base
₩41,868
+603.7%
Bull
₩77,765
+1,207.0%

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 (6.3%).

Revenue growth

  • 2.8%

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

    Default: the last 3 years' revenue growth (2.8% a year, annual reports), fading to 3% by year 5.

  • 2.8%

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

    Default: the last 3 years' revenue growth (2.8% 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 (2.8% 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 (2.8% 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 (2.8% a year, annual reports), fading to 3% by year 5.

Business

  • 6.3%

    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.

  • 3.5%

    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).

  • 4.4%

    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).

  • 26.7%

    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 0.09, 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)
₩501B
Net debt (borrowings and leases − cash and deposits)
−₩35B
− Minority interests
₩1B
Shares
9,066,000
Share price
₩5,950
Market cap
₩54B

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₩442B₩464B₩521B₩516B₩530B₩545B₩561B₩578B
Growth−8.0%5.1%12.3%2.8%2.8%2.9%2.9%3.0%
EBIT₩35B₩30B₩25B₩32B₩33B₩34B₩35B₩36B
EBIT margin8.0%6.4%4.8%6.3%6.3%6.3%6.3%6.3%
After-tax EBIT₩25B₩21B₩18B₩24B₩24B₩25B₩26B₩26B
+ Depreciation———₩18B₩19B₩19B₩20B₩20B
− Capital spending₩17B₩25B₩20B₩23B₩23B₩24B₩25B₩25B
− Working capital−₩26B₩33B−₩1.3B₩3.7B₩3.9B₩4.1B₩4.2B₩4.5B
Free cash flow———₩15B₩16B₩16B₩16B₩17B
Discount factor———0.9310.8670.8070.7510.700
Present value———₩14B₩14B₩13B₩12B₩12B

Terminal value ₩402B, worth ₩281B today: 81% 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 ₩20,581 a share)Now 0.29×₩7,3560.36×₩9,1500.44×₩14,6760.71×
Price / earnings (last 12 months: ₩2,180 a share)Now 2.73×₩5,3442.45×₩8,7734.02×₩14,3716.59×
P/E on run-rate earnings (Q2 2026 × 4: ₩214 a share)Now 27.8×₩5252.45×₩8624.02×₩1,4116.59×

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%₩45,560₩47,971₩50,914₩54,594₩59,335
6.9%₩41,812₩43,685₩45,928₩48,665₩52,088
7.4%₩38,654₩40,130₩41,868₩43,949₩46,488
7.9%₩35,958₩37,134₩38,500₩40,108₩42,032
8.4%₩33,630₩34,576₩35,661₩36,921₩38,402

Now (TTM)

Market cap
₩54B
Enterprise value
₩18B
P/E
2.7×
P/B
0.3×
P/S
0.1×
EV/EBITDA
—
Dividend yield
6.7%

Over time (at each year end)

20252024202320222021
Price₩7,720₩7,780₩7,920₩8,110₩10,150
Market cap₩70B₩71B₩72B₩74B₩92B
P/E5.6×3.0×4.2×2.7×7.8×
P/B0.4×0.4×0.5×0.5×0.8×
P/S0.1×0.2×0.2×0.2×0.3×
EV/EBITDA—————
Dividend yield5.2%5.1%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
Hojeon2.7×0.3×0.1×—6.7%
F&F4.5×1.1×1.2×—4.4%
LF5.5×0.4×0.3×4.5×3.3%
Chokwang Leather43.6×0.7×4.8×57.9×0.0%
Handsome7.1×0.3×0.3×—0.0%
Hansae9.4×0.4×0.2×—0.0%
JS4.0×0.6×0.2×—5.3%
Similar companies (median)6.3×0.5×0.3×31.2×1.6%

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

Also known as: Hojeon / 호전실업 / 111110 / KRX:111110

Source: KRX statistical information