New Risk • Jun 17
New major risk - Revenue and earnings growth Earnings have declined by 50% per year over the past 5 years. This is considered a major risk. Ultimately, shareholders want to see a good return on their investment and that generally comes from sharing in the company's profits. If profits are declining over an extended period, then in most cases the share price will decline over time unless the company can turn around its fortunes. A trend of falling earnings can be very difficult to turn around. If the company is well already established it may also be a sign the company has matured and is in decline. In addition, if the company pays dividends it will also likely need to reduce or cut them, striking a dual blow to total shareholder returns. Currently, the following risks have been identified for the company: Major Risks Interest payments are not well covered by earnings (2.7x net interest cover). Earnings have declined by 50% per year over the past 5 years. Minor Risks Unstable dividend paying track record with dividend experiencing an annual drop of over 20% in the past. Large one-off items impacting financial results. Valuation Update With 7 Day Price Move • Jun 15
Investor sentiment improves as stock rises 24% After last week's 24% share price gain to ₩37,300, the stock trades at a forward P/E ratio of 8x. Average forward P/E is 10x in the Chemicals industry in South Korea. Total loss to shareholders of 21% over the past three years. New Risk • May 28
New major risk - Financial position The company's interest payments are not well covered by earnings. Net interest cover: 2.7x This is considered a major risk. If the company is unable to fund interest repayments on its debt through profits, it may be forced into reducing its debt burden through selling assets, undertaking a potentially costly capital raising or even into bankruptcy in the worst case scenario. Currently, the following risks have been identified for the company: Major Risk Interest payments are not well covered by earnings (2.7x net interest cover). Minor Risks Unstable dividend paying track record with dividend experiencing an annual drop of over 20% in the past. Large one-off items impacting financial results. Buy Or Sell Opportunity • Apr 16
Now 21% overvalued after recent price rise Over the last 90 days, the stock has risen 13% to ₩40,100. The fair value is estimated to be ₩33,038, however this is not to be taken as a sell recommendation but rather should be used as a guide only. Revenue has declined by 4.2% over the last 3 years. Earnings per share has declined by 42%. Revenue is forecast to grow by 21% in 2 years. Earnings are forecast to grow by 120% in the next 2 years. Buy Or Sell Opportunity • Mar 11
Now 20% overvalued after recent price rise Over the last 90 days, the stock has risen 14% to ₩36,500. The fair value is estimated to be ₩30,345, however this is not to be taken as a sell recommendation but rather should be used as a guide only. Revenue has declined by 4.2% over the last 3 years. Earnings per share has declined by 42%. Revenue is forecast to grow by 21% in 2 years. Earnings are forecast to grow by 120% in the next 2 years. Valuation Update With 7 Day Price Move • Mar 04
Investor sentiment deteriorates as stock falls 16% After last week's 16% share price decline to ₩34,250, the stock trades at a forward P/E ratio of 9x. Average forward P/E is 14x in the Chemicals industry in South Korea. Total loss to shareholders of 21% over the past three years. Declared Dividend • Mar 02
Dividend of ₩1,300 announced Shareholders will receive a dividend of ₩1,300. Ex-date: 6th March 2026 Payment date: 27th March 2026 Dividend yield will be 3.3%, which is higher than the industry average of 1.7%. Sustainability & Growth Dividend is well covered by both earnings (20% earnings payout ratio) and cash flows (9% cash payout ratio). The dividend has decreased over the past 76 years, indicating a lack of growth and stability in payments. EPS is expected to grow by 56% over the next 2 years, which should provide support to the dividend and adequate earnings cover. Announcement • Feb 27
Kukdo Chemical Co., Ltd. announces Annual dividend, payable on March 27, 2026 Kukdo Chemical Co., Ltd. announced Annual dividend of KRW 1300.0000 per share payable on March 27, 2026, ex-date on March 06, 2026 and record date on March 09, 2026. Announcement • Jan 28
Kukdo Chemical Co., Ltd., Annual General Meeting, Mar 13, 2026 Kukdo Chemical Co., Ltd., Annual General Meeting, Mar 13, 2026, at 10:00 Tokyo Standard Time. Location: conference room, geumcheon-gu, seoul South Korea Valuation Update With 7 Day Price Move • Jan 15
Investor sentiment improves as stock rises 16% After last week's 16% share price gain to ₩36,600, the stock trades at a forward P/E ratio of 9x. Average forward P/E is 10x in the Chemicals industry in South Korea. Total loss to shareholders of 9.3% over the past three years. Reported Earnings • Mar 12
Full year 2024 earnings released: EPS: ₩1,029 (vs ₩894 in FY 2023) Full year 2024 results: EPS: ₩1,029 (up from ₩894 in FY 2023). Revenue: ₩1.31t (flat on FY 2023). Net income: ₩8.84b (up 15% from FY 2023). Profit margin: 0.7% (up from 0.6% in FY 2023). Over the last 3 years on average, the company's share price growth rate has exceeded its earnings growth rate by 94 percentage points per year, which is a significant difference in performance. Upcoming Dividend • Feb 28
Upcoming dividend of ₩600 per share Eligible shareholders must have bought the stock before 07 March 2025. Payment date: 25 March 2025. The company is not currently making a profit and is not cash flow positive. Trailing yield: 3.7%. Lower than top quartile of South Korean dividend payers (3.9%). Higher than average of industry peers (2.0%). Announcement • Jan 24
Kukdo Chemical Co., Ltd., Annual General Meeting, Mar 14, 2025 Kukdo Chemical Co., Ltd., Annual General Meeting, Mar 14, 2025, at 10:00 Tokyo Standard Time. Location: forest hall, geumcheon-gu, seoul South Korea Buy Or Sell Opportunity • Dec 13
Now 20% overvalued Over the last 90 days, the stock has fallen 12% to ₩28,400. The fair value is estimated to be ₩23,648, however this is not to be taken as a sell recommendation but rather should be used as a guide only. Revenue has declined by 9.0% over the last 3 years. Meanwhile, the company became loss making. New Risk • May 21
New major risk - Dividend sustainability The dividend is not well covered by earnings and cash flows. The company is paying a dividend despite being loss-making. Cash payout ratio: 190% Dividend yield: 3.2% This is considered a major risk. Companies that pay out too much of their earnings and cash flows are at risk of having to reduce or cut their dividend in future. If earnings or cash flows stagnate or fall, then there may not be enough to maintain the same dividend. Or in extreme cases, companies may opt to dig into capital reserves or take on debt to maintain the dividend. For dividend paying companies, any reduction in the dividend can significantly impact the share price. This is currently the only risk that has been identified for the company. Reported Earnings • Mar 12
Full year 2023 earnings released: EPS: ₩921 (vs ₩8,626 in FY 2022) Full year 2023 results: EPS: ₩921 (down from ₩8,626 in FY 2022). Revenue: ₩1.31t (down 18% from FY 2022). Net income: ₩7.70b (down 90% from FY 2022). Profit margin: 0.6% (down from 4.6% in FY 2022). The decrease in margin was driven by lower revenue. Revenue is forecast to grow 24% p.a. on average during the next 2 years, compared to a 11% growth forecast for the Chemicals industry in South Korea. Over the last 3 years on average, earnings per share has fallen by 36% per year but the company’s share price has only fallen by 8% per year, which means it has not declined as severely as earnings. Upcoming Dividend • Dec 20
Upcoming dividend of ₩1,400 per share at 3.3% yield Eligible shareholders must have bought the stock before 27 December 2023. Payment date: 28 March 2024. The company is not currently making a profit but it is cash flow positive. Trailing yield: 3.3%. Lower than top quartile of South Korean dividend payers (3.5%). Higher than average of industry peers (1.8%). Valuation Update With 7 Day Price Move • Oct 20
Investor sentiment deteriorates as stock falls 16% After last week's 16% share price decline to ₩41,650, the stock trades at a trailing P/E ratio of 19.9x. Average forward P/E is 11x in the Chemicals industry in South Korea. Total returns to shareholders of 33% over the past three years. Reported Earnings • Aug 20
Second quarter 2023 earnings released: EPS: ₩507 (vs ₩4,493 in 2Q 2022) Second quarter 2023 results: EPS: ₩507 (down from ₩4,493 in 2Q 2022). Revenue: ₩346.8b (down 21% from 2Q 2022). Net income: ₩4.23b (down 89% from 2Q 2022). Profit margin: 1.2% (down from 8.8% in 2Q 2022). The decrease in margin was driven by lower revenue. Revenue is forecast to grow 18% p.a. on average during the next 3 years, compared to a 18% growth forecast for the Chemicals industry in South Korea. Over the last 3 years on average, earnings per share has increased by 8% per year but the company’s share price has increased by 17% per year, which means it is tracking significantly ahead of earnings growth. Reported Earnings • May 19
First quarter 2023 earnings released: EPS: ₩1,260 (vs ₩3,811 in 1Q 2022) First quarter 2023 results: EPS: ₩1,260 (down from ₩3,811 in 1Q 2022). Revenue: ₩343.6b (down 18% from 1Q 2022). Net income: ₩10.6b (down 68% from 1Q 2022). Profit margin: 3.1% (down from 7.9% in 1Q 2022). The decrease in margin was driven by lower revenue. Over the last 3 years on average, earnings per share has increased by 27% per year but the company’s share price has only increased by 10% per year, which means it is significantly lagging earnings growth. Reported Earnings • Mar 08
Full year 2022 earnings released: EPS: ₩8,626 (vs ₩21,321 in FY 2021) Full year 2022 results: EPS: ₩8,626 (down from ₩21,321 in FY 2021). Revenue: ₩1.60t (up 1.6% from FY 2021). Net income: ₩74.3b (down 53% from FY 2021). Profit margin: 4.6% (down from 10.0% in FY 2021). The decrease in margin was driven by higher expenses. Over the last 3 years on average, earnings per share has increased by 42% per year but the company’s share price has only increased by 13% per year, which means it is significantly lagging earnings growth. Upcoming Dividend • Dec 21
Upcoming dividend of ₩2,200 per share Eligible shareholders must have bought the stock before 28 December 2022. Payment date: 28 March 2023. Payout ratio is a comfortable 16% but the company is not cash flow positive. Trailing yield: 4.8%. Within top quartile of South Korean dividend payers (3.3%). Higher than average of industry peers (2.4%). Board Change • Nov 16
Less than half of directors are independent No new directors have joined the board in the last 3 years. The company's board is composed of: No new directors. 7 experienced directors. 5 highly experienced directors. 3 independent directors (4 non-independent directors). Independent Outside Director Eun-Taek Lee was the last independent director to join the board, commencing their role in 2008. The following issues are considered to be risks according to the Simply Wall St Risk Model: Minority of independent directors. Insufficient board refreshment. Board Change • Apr 27
Less than half of directors are independent No new directors have joined the board in the last 3 years. The company's board is composed of: No new directors. 7 experienced directors. 5 highly experienced directors. 3 independent directors (4 non-independent directors). Independent Outside Director Eun-Taek Lee was the last independent director to join the board, commencing their role in 2008. The following issues are considered to be risks according to the Simply Wall St Risk Model: Minority of independent directors. Insufficient board refreshment. Reported Earnings • Mar 13
Full year 2021 earnings: EPS in line with expectations, revenues disappoint Full year 2021 results: EPS: ₩21,321 (up from ₩4,381 in FY 2020). Revenue: ₩1.58t (up 39% from FY 2020). Net income: ₩157.7b (up 436% from FY 2020). Profit margin: 10.0% (up from 2.6% in FY 2020). The increase in margin was driven by higher revenue. Revenue missed analyst estimates by 6.8%. Over the next year, revenue is expected to shrink by 6.6% compared to a 20% growth forecast for the industry in South Korea. Over the last 3 years on average, earnings per share has increased by 51% per year but the company’s share price has only increased by 11% per year, which means it is significantly lagging earnings growth. Upcoming Dividend • Dec 22
Upcoming dividend of ₩978 per share Eligible shareholders must have bought the stock before 29 December 2021. Payment date: 29 March 2022. Payout ratio is a comfortable 5.2% but the company is not cash flow positive. Trailing yield: 1.8%. Lower than top quartile of South Korean dividend payers (2.4%). Higher than average of industry peers (1.5%). Reported Earnings • Nov 18
Third quarter 2021 earnings released: EPS ₩5,766 (vs ₩952 in 3Q 2020) The company reported a strong third quarter result with improved earnings, revenues and profit margins. Third quarter 2021 results: Revenue: ₩408.8b (up 43% from 3Q 2020). Net income: ₩43.6b (up ₩37.2b from 3Q 2020). Profit margin: 11% (up from 2.2% in 3Q 2020). The increase in margin was driven by higher revenue. Over the last 3 years on average, earnings per share has increased by 33% per year but the company’s share price has only increased by 15% per year, which means it is significantly lagging earnings growth. Valuation Update With 7 Day Price Move • Sep 02
Investor sentiment improved over the past week After last week's 17% share price gain to ₩75,600, the stock trades at a trailing P/E ratio of 5.4x. Average trailing P/E is 19x in the Chemicals industry in South Korea. Total returns to shareholders of 93% over the past three years. Announcement • Aug 14
Kukdo Chemical Co., Ltd. has completed a Follow-on Equity Offering in the amount of KRW 94.4 billion. Kukdo Chemical Co., Ltd. has completed a Follow-on Equity Offering in the amount of KRW 94.4 billion.
Security Name: Common Stock
Security Type: Common Stock
Securities Offered: 1,600,000
Price\Range: KRW 59000
Transaction Features: ESOP Related Offering; Rights Offering Valuation Update With 7 Day Price Move • Jun 30
Investor sentiment improved over the past week After last week's 16% share price gain to ₩80,000, the stock trades at a trailing P/E ratio of 10.2x. Average trailing P/E is 20x in the Chemicals industry in South Korea. Total returns to shareholders of 53% over the past three years. Announcement • Jun 25
Kukdo Chemical Co., Ltd. (KOSE:A007690) entered into an agreement to acquire SEOKYO HEUNGUP CO., LTD. for KRW 65 billion. Kukdo Chemical Co., Ltd. (KOSE:A007690) entered into an agreement to acquire SEOKYO HEUNGUP CO., LTD. for KRW 65 billion on June 26, 2021. The first installment of KRW 1 billion will be paid by June 2021, the second payment of KRW12 billion will be paid by July 2021, the third payment of KRW 19.5 billion will be paid by January 2022 and the third payment of KRW 32.5 billon will be paid by July 2022. As a part of the agreement 0.04 million shares were acquired. As of December 31, 2020, SEOKYO HEUNGUP reported total assets of KRW 49.77 billion, total equity of KRW 22.92 billion, capital of KRW 400 million, sale of KRW 1.47 billion and net income of KRW 650.46 billion. The Kukdo Chemical board resolution was provided on June 24, 2021. The transaction is expected to be completed by July 4, 2022. Reported Earnings • May 23
First quarter 2021 earnings released: EPS ₩3,659 (vs ₩1,209 in 1Q 2020) The company reported a strong first quarter result with improved earnings, revenues and profit margins. First quarter 2021 results: Revenue: ₩310.9b (up 11% from 1Q 2020). Net income: ₩19.9b (up 197% from 1Q 2020). Profit margin: 6.4% (up from 2.4% in 1Q 2020). The increase in margin was driven by higher revenue. Over the last 3 years on average, earnings per share has fallen by 13% per year but the company’s share price has increased by 6% per year, which means it is well ahead of earnings. Reported Earnings • Mar 14
Full year 2020 earnings released: EPS ₩5,376 (vs ₩6,297 in FY 2019) The company reported a soft full year result with weaker earnings and profit margins, although revenues improved. Full year 2020 results: Revenue: ₩1.13t (up 1.0% from FY 2019). Net income: ₩29.4b (down 16% from FY 2019). Profit margin: 2.6% (down from 3.1% in FY 2019). Over the last 3 years on average, earnings per share has fallen by 16% per year but the company’s share price has only fallen by 2% per year, which means it has not declined as severely as earnings. Is New 90 Day High Low • Mar 11
New 90-day high: ₩58,500 The company is up 6.0% from its price of ₩55,000 on 11 December 2020. The South Korean market is also up 6.0% over the last 90 days, indicating the company’s price trend is similar to the market over that time. However, it underperformed the Chemicals industry, which is up 9.0% over the same period. Announcement • Feb 20
Kukdo Chemical Co., Ltd., Annual General Meeting, Mar 19, 2021 Kukdo Chemical Co., Ltd., Annual General Meeting, Mar 19, 2021, at 10:00 Korea Standard Time. Is New 90 Day High Low • Dec 17
New 90-day high: ₩58,200 The company is up 24% from its price of ₩46,850 on 18 September 2020. The South Korean market is up 14% over the last 90 days, indicating the company outperformed over that time. It also outperformed the Chemicals industry, which is up 20% over the same period. Valuation Update With 7 Day Price Move • Dec 01
Market bids up stock over the past week After last week's 21% share price gain to ₩54,900, the stock is trading at a trailing P/E ratio of 9.5x, up from the previous P/E ratio of 7.8x. This compares to an average P/E of 15x in the Chemicals industry in South Korea. Total return to shareholders over the past three years is a loss of 10%. Is New 90 Day High Low • Nov 27
New 90-day high: ₩49,900 The company is up 29% from its price of ₩38,700 on 28 August 2020. The South Korean market is up 11% over the last 90 days, indicating the company outperformed over that time. It also outperformed the Chemicals industry, which is up 13% over the same period.