Korean Air is an airline built on two pillars—a passenger business that carries people and a cargo business that carries goods—with first-quarter 2026 (parent basis) passenger revenue of about ₩2.6131 trillion and cargo revenue of about ₩1.0906 trillion; passenger is the larger, while cargo acts as a stabilizer, and maintenance, in-flight catering and other ancillary lines are attached. From 2025 it has consolidated Asiana Airlines, which it acquired, lifting consolidated revenue 41% to ₩25.2 trillion, and in May it decided on an absorption merger (a merger ratio of 1 to 0.2736432), with the integrated Korean Air set to launch on December 17, 2026. The stand-out points lately are that parent-basis results are solid in both passenger and cargo—delivering record first-quarter revenue—alongside a P/B of 0.93x, a 2.7% dividend and room for merger synergies on the strength side; on the caution side are the financial leverage of a 355.6% debt ratio, a net profit sensitive to exchange rates and fuel prices, and the mileage and route-adjustment burdens of the integration process.
At-a-glance assessment financial health · growth · profitability · valuation
- Debt far exceeds equity (debt ratio 355.6%).
- Assets that can be turned to cash within a year fall short of near-term liabilities (current ratio 64.4%).
- Revenue rose 41.2% year over year, and the pace is quickening (3-year trend: rising).
- Most recent quarter (Q1 2026) revenue was 2.6% higher than a year earlier.
- ROE is 7.1% (controlling-interest basis). It is above the sector average.
- Operating margin is 4.4%.
- P/B is low versus peers too, so it looks cheap on an asset basis as well.
Ownership & governance As of 2020-12-31
Largest shareholder Hanjin Kal 29.27% (individual)
Controlling bloc incl. related parties 32.55%
With the controlling bloc holding 33%, the ownership structure is stable.
🔎 In-depth analysis
- Korean Air rests on two pillars: a passenger business that carries people and a cargo business that carries goods.
- In the first quarter of 2026 (parent basis) passenger revenue was about ₩2.6131 trillion and cargo revenue about ₩1.0906 trillion; passenger is the larger, while cargo acts as a stabilizer for results.
- Ancillary lines such as aircraft maintenance (MRO), in-flight catering and limousine service are attached to these.
- From 2025 it has consolidated the acquired Asiana Airlines as a subsidiary, lifting consolidated revenue 41% year over year to ₩25.2 trillion—largely the effect of adding Asiana's revenue rather than a sudden expansion of the business.
- When it absorbs Asiana in December 2026, the two companies will be integrated into a single airline.
- The latest close is ₩26,700 and the market capitalization is ₩9.8 trillion.
- The price sits below its 20-day line (₩28,140) and above its 60-day line (₩26,336).
- With the short- and medium-term trends diverging, the direction should be read separately.
- The RSI (an auxiliary gauge that scores the strength of gains versus losses over the past 14 days on a 0–100 scale) is 46.1, a neutral level.
- The one-month change is +4.9%, the three-month change is +15.6%, and the position versus the 52-week high is -11.0%.
- Relative strength versus the KOSPI is 39 (1–99; a recency-weighted conversion of return versus the index over the past year, with higher meaning stronger than the market).
- That places it around the top 61% of all listed names by strength.
- Over the past three months it has lagged the index by 13.8%.
- Chart reading is best done together with volume and the dates on which disclosures occur.
- The P/E (how many times one year of net profit the price represents) is 12.61x and the P/B (how many times net asset value the price represents) is 0.90x, trading below book.
- In an industry with heavy physical assets such as aircraft, maintenance facilities and route rights, a P/B under 1.0x can be read as a signal of undervaluation relative to assets.
- The dividend yield is 2.7% (₩750 per share) with a 35.5% payout, returning roughly a third of profit to shareholders.
- That said, the debt ratio (debt against equity) is high at 355.6%, largely because the industry finances aircraft through leases and borrowing and because Asiana's debt is now consolidated in.
- ROE (how much is earned in a year on equity) is 7.1%.
- One caution: consolidated net profit (₩779.7 billion last year, ₩33.7 billion in the first quarter this year) swings heavily with Asiana's losses and foreign-currency debt valuation gains and losses.
- So the roughly 13x P/E on last year's basis is calculated on top of a “suppressed” net profit and does not fully show the parent's underlying earning power.
- Over five years revenue grew from ₩9.0 trillion to ₩25.2 trillion, a roughly 29% annual pace, and the +41% in 2025 reflects the addition of Asiana's consolidation.
- By contrast, consolidated operating profit (-47% last year) and net profit (-41% last year) went backward—not because the parent worsened, but because Asiana's losses and a high exchange rate pulled the consolidated figures down.
- That contrast is even sharper in the first quarter of 2026.
- On a parent (standalone) basis, revenue of ₩4.5151 trillion (+14%), operating profit of ₩516.9 billion (+47%) and net profit of ₩242.7 billion (+26%) delivered record first-quarter revenue, yet consolidated net profit including Asiana shrank to ₩33.7 billion.
- The path ahead turns on two things.
- First, when the December 2026 absorption merger folds Asiana into the Korean Air parent, the strong standalone earning power lifts the combined results.
- Second, the company has laid out annual synergies of around ₩300 billion combining revenue gains and cost savings.
- So the decline in consolidated net profit last year and early this year is closer to a “cost of the integration transition,” while the parent's operating trend (double-digit operating-profit growth) better shows the real underlying strength.
- In May 2026 Korean Air decided to absorb its subsidiary Asiana Airlines and filed a material-event report.
- The merger ratio is Korean Air 1 to Asiana 0.2736432, and the integrated Korean Air is set to launch on December 17, 2026.
- The government (Ministry of Land, Infrastructure and Transport) completed a conditional merger approval, and the low-cost affiliates Air Busan, Air Seoul and Jin Air are subsequently slated for phased integration.
- In June, disclosures on bond-type warrants and notices of investor briefings (IR) followed.
- These schedules mean the company's business structure will be substantially reshaped over the next one to two years, making the progress of the integration and the pace of synergy realization the key points to watch.
- Strong conditions: parent (standalone) results are solid in both passenger and cargo, delivering record first-quarter revenue and double-digit operating-profit growth, and at a P/B of 0.93x the stock is in undervalued territory relative to physical assets.
- The 2.7% dividend is also supported.
- If the December absorption of Asiana is completed, the subsidiary-loss factor that has weighed on consolidated results is folded into the parent, with room for synergies (put at ₩300 billion a year) to be added.
- Cautionary conditions: with a 355.6% debt ratio the financial leverage is large, and with a current ratio of 64.4% short-term liquidity is not ample.
- Above all, consolidated net profit is sensitive to exchange rates (foreign-currency debt valuation gains and losses) and fuel prices, so quarterly swings are large—in a weak-won, spiking-fuel phase, net profit can be pressed down even when operations are good.
- Mileage and overlapping-route adjustments during integration and the burden of meeting approval conditions also remain.
- In sum, the parent's earning power and asset value are solid, but judging on the net-profit metric alone tends to understate the real underlying strength.
🔎 Valuation vs peers Undervalued
Compared against domestic air-transport peers and the subsidiary (Asiana), from the viewpoint of a large national flag carrier operating both passenger and cargo.
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| Asiana Airlines | 0.00x | 1.97x | -37.94% |
(a) Unlike its subsidiary Asiana (P/B 2.03x, ROE -37.9%), the parent stands in contrast with profitability and a low P/B. (b) In an asset-heavy airline industry, a P/B of 0.93x is a discount to asset value. (c) The roughly 13x P/E on last year's basis is calculated on top of a “suppressed” consolidated net profit driven by Asiana's losses and exchange rates, so it under-reflects the parent's earning power—given that standalone operating profit grew 47% year over year and the December absorption merger folds and cleans up the subsidiary-loss factor into the parent, on a forward basis for a net-profit recovery the current valuation leans cheap. Still, because net profit is highly variable, this is a judgment that weights asset value plus parent earning power rather than a firm conclusion.
Price history Close · MA20 · MA60
The latest close is ₩26,700 and the market capitalization is ₩9.8 trillion. The price sits below its 20-day moving average (₩28,140) and above its 60-day moving average (₩26,336). Short-term and medium-term trends are diverging, so the direction is best read separately. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 46.1, a neutral level. The one-month change is +4.9%, the three-month change is +15.6%, and the position relative to the 52-week high is -11.0%. Relative strength versus the KOSPI is 39 (on a 1-99 scale, converted from returns against the index over the past year with more weight on recent performance; higher means stronger than the market). It is stronger than roughly 39% of all stocks. Over the past three months it lagged the index by 13.8%. Chart interpretation is best done alongside trading volume and the dates on which disclosures occur.
Relative performance stock vs index · start = 100
Excess return vs index · 3M -13.82% / 6M -26.35% / 12M -52.46%
Key metrics vs whole-market median
Valuation
The P/E of 12.61x is in line with the whole-market median (13.81x). The P/B of 0.90x is below the whole-market median (1.15x).
Enterprise value (EV)
EV = market cap + net debt. It reflects cash and debt, so it captures the real cost of the whole business that market cap alone misses; lower multiples are cheaper relative to earnings or sales.
Intrinsic value (DCF estimate)
DCF (discounted cash flow) estimate — discount rate 10.4%, initial growth 4.1%→terminal 2.0%, 10-yr forecast, earnings-based. A reference range that shifts materially with assumptions.
Profitability & financials
Return on equity (ROE) is 7.1%, above the whole-market average (5.0%). The operating margin is 4.4%. The debt ratio is 355.6%, so the financial structure is somewhat high.
Growth FY2025 · annual report (consolidated)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $10.7B | $11.8B | $16.7B | +41.16% ↑ faster |
| Operating profit | $1.2B | $1.4B | $738.1M | -47.23% ↓ slower |
| Net profit | $703.3M | $873.0M | $516.7M | -40.81% ↓ slower |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $6.0B | $9.3B | $10.7B | $11.8B | $16.7B |
| Operating profit | $939.8M | $1.9B | $1.2B | $1.4B | $738.1M |
| Net profit | $382.9M | $1.1B | $703.3M | $873.0M | $516.7M |
| Revenue CAGR | 4-yr avg 29.33% | ||||
Revenue rose 41.2% year over year (2023 ₩16.1 trillion → 2024 ₩17.9 trillion → 2025 ₩25.2 trillion), and the three-year trend is 'rising'. The pace of growth also quickened from the prior year. Operating profit fell 47.2% year over year. The decline widened. Over the 5 years on record, revenue compound annual growth (CAGR) is 29.3%. The two-year revenue CAGR is 25.1%. In the most recent quarter (Q1 2026), revenue was 2.6% higher than the same period a year earlier.
Latest quarterly results Q1 2026 · vs year-ago
Technical indicators
What stands out
- P/E and P/B are both low versus peers, so the price looks inexpensive relative to earnings and assets.
- Revenue grew 41.2% year over year, a sign of growth.
Points to watch
- Debt far exceeds equity (debt ratio 355.6%).
- Assets that can be turned to cash within a year fall short of near-term liabilities (current ratio 64.4%).
Recent news & events searched · sourced
- 2026-05-14FilingDecision to absorb subsidiary Asiana Airlines (material-event report). Merger ratio Korean Air 1 : Asiana 0.2736432; the integrated entity is set to launch on December 17, 2026.The core of a medium- to long-term business restructuring. The starting point at which Asiana's losses are consolidated into the parent and route and cost synergies begin in earnest. Source
- 2026-05-13FilingCompany-merger decision (material management matter of a subsidiary) disclosure. Start of the Asiana Airlines absorption-merger process.The official start of the merger process. The reference point for the integration timetable and the scale of new-share issuance. Source
- 2026-06-10IRNotice of an investor briefing (IR). The company's communication on results and the progress of integration.In the short term, a channel for confirming the integration's progress rate and synergy plans. Source
- 2026-05-15EarningsFirst-quarter 2026 quarterly report filed. On a standalone basis, revenue of ₩4.5151 trillion, operating profit of ₩516.9 billion and net profit of ₩242.7 billion (record first-quarter revenue); consolidated net profit of ₩33.7 billion reflecting Asiana.Material confirming the gap between parent strength and consolidated net profit. This gap may persist until the integration. Source
Figure cross-check computed ↔ external
Recent filings
- 2026-06-10Disclosure
- 2026-06-10Disclosure
- 2026-06-05Disclosure
- 2026-06-05Amended filing
- 2026-06-01Large-business-group status disclosure (amended)
- 2026-05-29Disclosure
- 2026-05-29Large-business-group status disclosure
- 2026-05-29Amended filing
- 2026-05-29Corporate governance report
- 2026-05-15PeriodicQuarterly report
- 2026-05-14Material-fact report (amended)
- 2026-05-13Merger decision
📖 Plain-language glossary — expand if you are new to this
- P/E
- How many times a year's net profit the price is worth (lower is cheaper relative to earnings). The P/E here is on trailing (last full-year) results; for companies whose earnings swing fast (memory chips and other cyclicals/high-growth), a forward P/E on this year's expected earnings is more accurate.
- P/B
- Price relative to net assets (equity). Around 1x means it trades near book value; below 1x means below book.
- P/S
- Price relative to a year's revenue — useful for growth companies with thin earnings.
- Net debt / EV
- Net debt = interest-bearing debt − cash. Negative means more cash than debt (net cash). EV (enterprise value) = market cap + net debt, closer to what it would cost to buy the whole business.
- EV/EBIT · EV/EBITDA · EV/Sales
- Enterprise value against operating profit (EBIT), EBITDA, or revenue. Unlike P/E these reflect debt and cash; lower is cheaper relative to earnings power or sales.
- FCF / FCF yield
- Free cash flow = operating cash − capex, the cash actually left over. FCF yield = FCF ÷ market cap; higher means more cash generated per unit of market value.
- Intrinsic value (DCF)
- Future free cash flow (or, for some capex-heavy but profitable names, forecast earnings) discounted to today to estimate per-share value. Because it shifts a lot with the discount-rate and growth assumptions, it is shown as a bear/base/bull range, and the basis and assumptions are disclosed in one line beneath it.
- ROE
- How much profit the company earns in a year on its equity (%). Higher means better returns on capital.
- EPS / BPS
- Earnings per share / net assets (book value) per share.
- Operating / net margin
- Profit left from the core business / final profit after tax and interest, per unit of revenue.
- Debt ratio
- Debt relative to equity (%). Higher means more reliance on borrowing (norms vary by sector).
- Current ratio
- Assets convertible to cash within a year against debt due within a year. Above 100% leaves some short-term headroom.
- Interest coverage
- How many times operating profit covers the interest owed. Below 1x means operating profit alone struggles to cover interest.
- Dividend yield / payout ratio
- The year's dividend as a % of today's price / the share of earnings paid out as dividends.
- Revenue CAGR
- Multi-year growth expressed as a single yearly average (compound annual growth rate).
- RSI (short-term signal)
- Whether recent price action is overheated or beaten down. Above 70 is overbought, below 30 oversold.
- MA20 / MA60 (moving averages)
- The 20- and 60-day average price. Price above them signals a firmer short-term trend.
- vs 52-week high
- How far below the past year's peak the price sits now (%).
All figures are for reference only; how they read varies by sector and over time.
Sources: Korea FSC market-price API (data.go.kr), OpenDART, KRX/KIND — public data only.
Bong Stocks presents public-data-based information for reference only. It is not investment advice and contains no target prices, ratings, or buy/sell recommendations. Verify independently before making any decision.