Michang Oil Industrial (003650) 🔎 In-depth
KOSPI · Price as of 2026-08-06 · Updated 2026-08-09
Michang Oil Industrial is not an integrated refiner that distills crude directly but an industrial-lubricant and functional-oil company that blends additives into base oil and processes and sells purpose-specific specialty oils; by product, lubricants for machine tools, ships and automobiles are the largest at about ₩295.1 billion, with rubber process oil of about ₩77.3 billion and electrical insulating oil of about ₩16.6 billion added, and through a technology tie-up with Japan's ENEOS it focuses on upgrading specialty oils in a mature business of around ₩400 billion a year. In March it raised the 2025 year-end cash dividend to ₩3,500 per share from ₩2,800 a year earlier and, at the same time, flagged a large rise in net profit via a disclosure of a change of 30% or more in profit structure; the May first-quarter report confirmed a double-digit recovery in operating profit, and a June large-holding filing by a 5%-plus shareholder confirmed a change in stake. The point worth watching is that the strengths -- a rock-solid balance sheet with almost no debt and current assets exceeding the market cap, ROE of 14.4%, P/B of 0.45, a raised dividend (₩3,500 per share, about 2.8%), and a P/E in the low single digits on both last year's and this year's expected profit -- come with a mature business where revenue does not grow much, so steadiness rather than explosive growth is the strength, and as a small-cap with thin volume, fills may not be smooth.
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30-second brief
Pulled directly from the computed values below — not a separately written opinion.
What do the SourceComputedEstimateReading tags mean?
Source filings and exchange data · Computed calculated from public data · Estimate our own unverified projection · Reading drafted automatically, then rule-checked. See AI & Automation.
Core valuation metric
This stock's effective sub-sector is “Oil Refining” (Chemicals, Refining, Steel & Materials), a type typically read first through P/B.
Refining is a cyclical business whose profits swing with crude prices and refining margins, ballooning in good times and often turning to losses in bad ones. That makes price-to-book (P/B) — the price against the value of the large refining asset base — the first lens rather than current-year earnings multiples.
Price against assets alone says little about where the cycle stands. Reading it together with price against this year's expected earnings shows how far profits have recovered.
This note explains how each sector is typically valued and is educational context only, not investment advice.
At-a-glance assessment financial health · growth · profitability · valuation
- Debt ratio, current ratio and interest burden all look healthy.
- Revenue fell 6.1% year over year (3-year trend: mixed).
- Most recent quarter (Q1 2026) revenue was 0.1% higher than a year earlier.
- ROE is 16.8% (controlling-interest basis). It is above the sector average.
- Operating margin is 9.2%.
- The forward P/E sits below the sector median.
Ownership & governance As of 2025-12-31
Largest shareholder Yoo Jae-soon 14.35% (individual)
Controlling bloc incl. related parties 40.24%
With the controlling bloc holding 40%, the ownership structure is stable.
🔎 In-depth analysis Reading
Michang Oil Industrial is not an integrated refiner that distills crude directly but an industrial-lubricant and functional-oil company that blends additives into base oil and processes and sells purpose-specific specialty oils. In the business report the segment is a single one, 'petroleum products manufacturing and sales,' and by product mix, lubricants used in machine tools, ships and automobiles are the largest at about ₩295.1 billion, rubber process oil used in rubber products such as tires and shoes is about ₩77.3 billion, and electrical insulating oil for transformers is about ₩16.6 billion. In other words, the main body of revenue is general and specialty lubricants, to which rubber process oil and electrical insulating oil -- areas with barriers to entry -- are added. Building on a technology tie-up with Japan's ENEOS, it focuses on upgrading specialty oils, and for automotive use it has a high share of factory filling, in which oil is filled directly at the automaker's plant. Revenue runs around ₩400 billion a year and is a mature business held without much variation.
The latest close is ₩147,200 and the market capitalization is ₩256.1 billion. The price sits above its 20-day moving average (₩141,065) and above its 60-day moving average (₩130,992). It holds above both its short- and medium-term moving averages, so the trend looks healthy. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 64.3, a neutral level. The one-month change is +8.2%, the three-month change is +22.2%, and the position relative to the 52-week high is -1.3%. Relative strength versus the KOSPI is 64 (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 64% of all stocks. Over the past three months it outpaced the index by 45.3%. Chart interpretation is best done alongside trading volume and the dates on which disclosures occur.
The valuation is low across the board. The P/E ratio (how many times one year's profit the price represents) is 3.72x and the P/B (how many times the company's net assets the price represents) is 0.52x, so it trades at less than half its net assets. Profitability is sound, with ROE (how much is earned in a year on equity) of 14.4%, a net margin of 17.0% and an operating margin of 8.5%. The net margin being higher than the operating margin is because non-operating income from the cash and investment assets it holds is added on top of the core margin; with current assets alone at ₩410.3 billion -- exceeding the market cap (₩215.4 billion) -- assets are so abundant that this non-operating income source is structural rather than one-off support. The debt ratio (debt against equity) is 11.4% and the current ratio (cash-like assets against debt due within a year) is 10.5x, a balance sheet with almost no debt, and with interest coverage of 28x the interest burden is effectively nil. The P/E on last year's confirmed profit is low, and the forward P/E on this year's expected profit is also still in the low single digits at 3.84x. That both the trailing and forward figures are low means the trailing multiple is not simply a cheap-looking illusion created by one-off gains; by either earnings or assets, this is a stock with a low price.
The top line is stable, as befits a mature business. Revenue has held in the ₩400 billion range over five years (2021-2025); last year it was down 6.1% year over year and operating profit down 24.3%, so the core business was somewhat held down, but given how lubricant demand rises and falls with the economy, this is closer to a normal-range fluctuation than serious structural damage. Net profit rose 30.9% to ₩68.9 billion last year, a third straight year of increase, supported by non-operating income from abundant assets. On a quarterly basis, first-quarter 2026 operating profit rose 25.5% from the same period a year earlier, a clear recovery signal for the core business, and net profit jumped 443%. The forward P/E on this year's expected profit (on this year's expected profit basis) coming out low at 3.84x is precisely the result of this core-business recovery, the steady non-operating income the assets generate, and the raised dividend reflected together. It is a figure that sums the core margin recovery and the non-operating income normalized to a normal-year level, rather than simply multiplying one quarter's result by four, and with this level of earnings power it is natural for the forward P/E to stay in the low single digits. It is not a growth stock whose revenue jumps sharply, but a type where a stable profit flow and thick assets form the foundation of profit.
Recent disclosures center on the dividend, periodic reports and stake changes. In March, it set the 2025 year-end cash dividend at ₩3,500 per share, up from ₩2,800 a year earlier, and at the same time flagged a large rise in net profit via a 'change of 30% or more in revenue or profit structure' disclosure. The March shareholders' meeting and the filing of the business report and audit report followed, and in May the first-quarter report confirmed a double-digit recovery in operating profit. In June, a 'large-holding report' by a 5%-plus shareholder was filed, showing there had been a change in stake. No separate large order or new investment disclosure is seen, so it is closer to the disclosure pattern of a mature company that carries on with a stable dividend and a solid balance sheet rather than top-line expansion.
This is a stock with distinct strengths. A rock-solid balance sheet with almost no debt and current assets exceeding the market cap, a sound ROE of 14.4%, a share price at about half of net assets (P/B 0.45), a raised dividend (₩3,500 per share, dividend yield of about 2.8%) and a first-quarter recovery in operating profit are all in place -- and above all, whether by last year's profit or this year's expected profit, the P/E stays in the low single digits, an undervalued zone. By any yardstick -- assets, profitability or price -- it belongs on the cheap and safe side. Points to consider together are that, as a mature business where revenue does not grow much, steadiness rather than explosive growth is the strength, and that as a small-cap with thin volume, fills may not be smooth when trading. In short, this is a stock in which the force of undervaluation clearly shows in a phase supported by a core-business profit recovery and abundant assets and dividends, and a type whose appeal may stand out relatively less in a phase where rapid top-line growth is expected.
🔎 Valuation vs peers Undervalued
Rather than the large refiners that distill crude, it is appropriate to use as peers functional-oil companies of similar scale and structure that blend and process lubricants and specialty oils. Large refining and chemical firms sit at a different point in their cycle, so direct comparison is distorted.
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| S-Oil | 79.47x | 1.47x | 1.99% |
| Kumho Petrochemical | 10.52x | 0.48x | 4.09% |
| SK Innovation | — | 0.78x | -15.36% |
Large refiners (S-Oil, SK Innovation) have P/Es in the 60x range or are loss-making, taking the full brunt of the refining down-cycle, so they are not suitable as a comparison benchmark. Even against Kumho Petrochemical on the chemical side (P/E 11x, P/B 0.52), Michang Oil trades at a lower level relative to earnings and assets, with a P/E of 3.18x, P/B of 0.46x and ROE of 14.4%, so on the numbers alone it sits in a discount zone versus peers. That said, this low P/E is based on last year's confirmed (trailing) profit, and a limit is that this profit carries a large mix of non-operating income that varies year to year. Normalizing the non-operating income and looking at this year's expected (forward) profit raises the multiple somewhat, but even so the absolute level is still on the low side. If abundant assets and a stable dividend are factors that narrow the discount, then slowing core-business growth and reliance on non-operating income are factors that justify the discount, so rather than declaring it cheap outright, it is appropriate to look at why it is cheap as well.
Price history Close · MA20 · MA60
The latest close is ₩147,200 and the market capitalization is ₩256.1 billion. The price sits above its 20-day moving average (₩141,065) and above its 60-day moving average (₩130,992). It holds above both its short- and medium-term moving averages, so the trend looks healthy. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 64.3, a neutral level. The one-month change is +8.2%, the three-month change is +22.2%, and the position relative to the 52-week high is -1.3%. Relative strength versus the KOSPI is 64 (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 64% of all stocks. Over the past three months it outpaced the index by 45.3%. 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 +45.32% / 6M -4.92% / 12M -34.80%
Key metrics Computed vs whole-market median
Valuation
The P/E of 3.72x is below the whole-market median (12.97x). The P/B of 0.52x is below the whole-market median (0.84x). Both metrics are low versus peers, so the price is not expensive relative to earnings and assets. That said, this P/E is based on last year's (trailing) results. With recent quarterly earnings up sharply, the trailing P/E can look higher than it really is, so a precise read is best done on this year's expected (forward) earnings.
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.
Profitability & financials
Return on equity (ROE) is 16.8%, above the whole-market average (3.0%). The operating margin is 9.2%. The debt ratio is 14.6%, so the financial structure is stable.
Growth FY2025 · annual report (separate)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $287.5M | $303.4M | $284.9M | -6.12% ↓ slower |
| Operating profit | $33.7M | $32.1M | $24.3M | -24.29% ↓ slower |
| Net profit | $33.5M | $37.0M | $48.4M | +30.86% ↑ faster |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $285.4M | $294.2M | $287.5M | $303.4M | $284.9M |
| Operating profit | $24.9M | $30.9M | $33.7M | $32.1M | $24.3M |
| Net profit | $23.3M | $16.4M | $33.5M | $37.0M | $48.4M |
| Revenue CAGR | 4-yr avg -0.05% | ||||
Revenue fell 6.1% year over year (2023 ₩409.2 billion → 2024 ₩431.9 billion → 2025 ₩405.5 billion), and the three-year trend is 'mixed'. The rate of decline widened from the prior year. Operating profit fell 24.3% year over year. The decline widened. Over the 5 years on record, revenue compound annual growth (CAGR) is -0.1%. The two-year revenue CAGR is -0.5%. In the most recent quarter (Q1 2026), revenue was 0.1% higher than the same period a year earlier.
Latest quarterly results Source Q1 2026 · vs year-ago
Technical indicators Computed
What stands out
- P/E and P/B are both low versus peers, so the price looks inexpensive relative to earnings and assets.
- ROE of 16.8% points to solid profitability.
- The balance sheet is stable in terms of debt and liquidity.
Points to watch
- Revenue fell 6.1% year over year (3-year trend: mixed).
- The price is near its 52-week high, so chasing it warrants caution around volatility.
Recent news & events searched · sourced
- 2026-03-11DividendDecided a 2025 year-end cash dividend of ₩3,500 per common share (raised from ₩2,800 a year earlier).It forms a dividend yield of about 2.8% and shows a will to expand shareholder returns. That said, with a payout ratio in the 7-8% range, there is still large room relative to profit. Source
- 2026-03-20Earnings[Corrected] Disclosure of a change of 30% or more (15% for large corporations) in revenue or profit structure -- flagging a large change in 2025 net profit.The official basis for the +30.9% rise in net profit. A clue to confirm the structure in which operating profit fell but net profit rose as non-operating income was added. Source
- 2026-03-20FilingFiling of the 2025 business report (on a separate basis, revenue ₩405.5 billion, operating profit ₩34.6 billion, net profit ₩68.9 billion).The primary source for confirmed annual results and the place to confirm revenue mix by segment and product (lubricants ₩295.1 billion, rubber process oil ₩77.3 billion, electrical insulating oil ₩16.6 billion). It confirms a year in which core-business softness and a net-profit improvement appeared together. Source
- 2026-05-15EarningsFiling of the first-quarter 2026 report -- revenue ₩101.1 billion (+0.1% YoY), operating profit ₩13.7 billion (+25.5%), net profit ₩16.9 billion (+443%).Confirms a double-digit recovery in core operating profit. The surge in net profit owes much to the low base a year earlier, so simple annualization warrants caution. Source
- 2026-06-09UpdateFiling of a large-holding report (general) by a 5%-plus shareholder -- a change in stake occurred.Given small-cap characteristics, a change in a major shareholder's stake can affect supply and demand, so monitoring is needed. Source
Figure cross-check computed ↔ external
| Metric | Computed | External | Status | Source |
|---|---|---|---|---|
| Cash dividend per share (2025 year-end) | DPS ₩3,500 / 2.78% | 1 ₩3,500 | Confirmed | link |
| Change in 2025 net profit | net profit 689 / YoY +30.9% | 30% | Confirmed | link |
| Annual results (2025) | revenue 4,055 / operating profit 346 / net profit 689 | revenue 4,055 / operating profit 346 / net profit 689 | Confirmed | link |
| This year's estimated net profit (annual) | approx. 560 | — | Unverified | link |
Recent filings Source
- 2026-06-09OwnershipOwnership-change filing
- 2026-05-28Corporate governance report
- 2026-05-15PeriodicQuarterly report
- 2026-05-11OwnershipOwnership-change filing
- 2026-03-30Shareholders' meeting notice
- 2026-03-30Disclosure
- 2026-03-20EarningsAmended filing
- 2026-03-20Audit report
- 2026-03-20PeriodicAnnual business report
- 2026-03-13Disclosure
- 2026-03-13Shareholders' meeting notice
- 2026-03-11DividendCash/stock dividend 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.