Chokwang Leather is a specialist leather maker that buys raw cowhide and turns it into finished natural leather through tanning, dyeing, and surface finishing; automotive seat leather is the core of its revenue, with furniture, footwear, and accessory leathers added on. As a B2B supplier of materials to automakers, furniture, and footwear firms, its results track downstream-industry volumes as well as hide prices and exchange rates. The March annual report confirmed 2025 results (revenue of 97.9 billion won, operating profit of 8.8 billion won, net profit of 11.5 billion won), and the May Q1 report showed the top line and core operating profit softening while net profit rose thanks to non-operating gains. What stands out lately is that a near-debt-free stability with a 14.6% debt ratio and an asset-type undervaluation at a P/B of 0.68x are strengths, whereas revenue has stalled and declined since a 2023 peak and ROE is low at 2.0%, so its efficiency in converting a thick equity base into earnings is still weak - making it strong from an asset-value view and one to watch further if revenue growth and capital efficiency come first.
At-a-glance assessment financial health · growth · profitability · valuation
- Debt ratio, current ratio and interest burden all look healthy.
- Revenue rose 8.5% year over year, and the pace is quickening (3-year trend: mixed).
- Most recent quarter (Q1 2026) revenue was 18.9% lower than a year earlier.
- ROE is 2.0% (total-net basis). It is below the sector average.
- Operating margin is 9.0%.
- The forward P/E sits above the sector median, reflecting elevated expectations.
Ownership & governance As of 2025-12-31
Largest shareholder Ji Gil-sun 9.62% (individual)
Controlling bloc incl. related parties 30.65%
With the controlling bloc holding 31%, the ownership structure is stable.
🔎 In-depth analysis
- Chokwang Leather is a specialist leather maker that buys raw cowhide and turns it into finished natural leather through tanning, dyeing, and surface finishing.
- The core of revenue is automotive seat leather, with the business otherwise split into leather for furniture (sofas), footwear, and accessories.
- Rather than a consumer brand, it is a B2B intermediate-goods company that supplies materials to automakers, furniture, and footwear firms, so its results track volumes in downstream industries (especially automobile production and the adoption of premium interior materials).
- Raw-material prices such as hides and chemicals, exchange rates, and the shift toward synthetic and vegan materials all bear on the structure as well.
- The latest close is 63,000 won and the market cap is 418.9 billion won.
- The price sits above the 20-day line (61,250 won) and below the 60-day line (63,683 won).
- The short-term and medium-term trends diverge, so each has to be read separately.
- The RSI (a supplementary gauge that compares upward and downward force over the past 14 days on a 0-100 scale) is 56.1, a neutral level.
- The one-month change is +3.6%, the three-month change is -4.4%, and the position relative to the 52-week high is -25.4%.
- Relative strength versus the KOSPI is 30 (on a 1-99 scale, converted from returns against the index over the past year with heavier weight on recent performance; higher means stronger than the market).
- That places it in roughly the top 70% by strength among all stocks.
- Over the past three months it lagged the index by 24.5%.
- It is best to read the chart alongside trading volume and disclosure dates.
- On a confirmed annual (2025) basis, the P/E (how many times the price is versus one year of net profit) is 36.29x and the P/B (how many times the price is versus book net assets) is 0.72x.
- Looked at on the P/E alone it appears high, but this is not because it is expensive; rather, it is a structural feature that arises because the company carries a large base of 577.9 billion won in shareholders' equity while the net profit earned on that equity (11.5 billion won) is relatively small.
- For an asset-type, low-ROE (how much is earned in a year on equity, 2.0%) company, a high P/E multiple is natural, and that number alone should not be taken as a 'burden.' What is worth noting instead is the P/B of 0.68x.
- It means the price is about 68% of book value per share (roughly 86,908 won) - clearly a discount zone on an asset-value basis.
- On top of that, the debt ratio (debt versus equity) is only 14.6% and the current ratio is 988%, so debt burden is almost nil and short-term liquidity is very ample, making the quality of this book value solid.
- The operating margin is 9.0%, and net profit (11.5 billion won) exceeding operating profit (8.8 billion won) is because non-operating gains from investments and finance support one pillar of earnings.
- Looking at the multi-year trend, revenue came down from a 2023 peak of 126.6 billion won to 97.9 billion won in 2025, but core profitability improved in the opposite direction.
- Operating profit, which had been squeezed to around 0.5 billion won in 2022, recovered to 8.8 billion won in 2025, up +21.6% year on year with an accelerating pace.
- The picture of margins and core earnings reviving ahead of top-line size is clear.
- The most recent Q1 2026 saw revenue of 20.9 billion won (-18.9% YoY) and operating profit of 1.6 billion won (-35.2%), with both the top line and core earnings taking a breather, but net profit rose +8.5%, again confirming the earnings structure supported by non-operating gains.
- Pulling this year's earnings picture together, the forward P/E of 32.9x is almost the same spot as the 34.3x on confirmed last-year results.
- That is, this year's net profit is seen holding near last year's low-to-mid 10-billion-won range, a figure reflecting the combined workings of core-margin recovery and non-operating gains.
- Since revenue is buffeted by downstream auto and furniture demand and by hide prices and exchange rates, there will be quarterly swings, but this year's underlying earnings power is set to hold last year's level.
- Recent activity has centered on regular disclosures and governance rather than events like new orders or large contracts.
- In March 2026, the annual report confirmed 2025 results (revenue of 97.9 billion won, operating profit of 8.8 billion won, net profit of 11.5 billion won), and the same month brought the regular general meeting and reports on outside-director appointments.
- In May, the Q1 2026 quarterly report came out confirming in numbers the softening of the top line and core operating profit, while net profit rose thanks to non-operating gains.
- In early June, the corporate-governance report was disclosed.
- Meanwhile, in March a large-holding report (short form) was filed showing a change in a major shareholder's stake, a point worth checking separately on the supply-demand side given that this is a thinly traded stock.
- This is a stock with clear strengths.
- With almost no debt (debt ratio 14.6%) and very ample liquidity, and with the price at 0.68x book value, it is an asset-type low-P/B company with a thick safety cushion from an asset-value view.
- Core operating profit has recovered steadily from a 2022 trough, and the structure in which non-operating gains add to net profit keeps the risk of slipping into a loss low.
- Forward earnings are also set to hold last year's level, so the high-looking P/E is less 'expensive' than a hallmark of an asset-type company with small earnings relative to a large capital base.
- That said, revenue has stalled and declined since a 2023 peak, and ROE at 2.0% is low, so its efficiency in fully deploying a thick capital base into earnings is still weak.
- Results are also buffeted by downstream auto and furniture demand and by hide prices and exchange rates, and trading is thin - both worth weighing.
- In short, it is strong from a view that prizes asset value (low P/B) and debt-free stability, and one to watch further from a view that prioritizes revenue growth and capital efficiency (ROE).
🔎 Valuation vs peers Inconclusive
The comparison uses listed companies in the same leather and footwear group with large leather-related revenue (JS Corporation is a bag ODM; SYTS makes leather and footwear materials), though because Chokwang Leather is an asset-type, low-ROE structure, a P/B and asset-value view fits better than a simple P/E comparison.
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| JS Corporation | 4.45x | 0.65x | 14.52% |
| SYTS | 6.75x | 0.36x | 5.28% |
Its position versus the peer set is a mixed picture, with the highest P/E (35.0x vs 4-6x) and a similarly low P/B (0.70x). The key is that this P/E is on a 'confirmed last-year (trailing)' basis. Chokwang Leather sits on a large 577.9 billion won of shareholders' equity yet earns only 11.5 billion won in net profit, so ROE is low at 2.0%; in such an asset-type, low-return structure, a high P/E multiple is natural and cannot alone be taken to mean 'expensive.' Conversely, the price at 0.70x book value is a discount on an asset-value basis. With no official company outlook, a DART seasonality approximation (this year's operating profit of about 4.7 billion won) suggests forward earnings will not grow much either, so the P/E multiple is unlikely to fall quickly. The two-sidedness - looking expensive on the earnings multiple and cheap on asset value - is large enough that this is left as 'inconclusive.'
Earnings outlook company-stated · verified
| Type | Period | Revenue | Operating profit | Net profit |
|---|---|---|---|---|
| Next quarter | Q2 2026 | approx. ₩19.9 billion | approx. ₩0.9 billion | approx. ₩2.9 billion |
Price history Close · MA20 · MA60
The latest close is ₩63,000 and the market capitalization is ₩418.9 billion. The price sits above its 20-day moving average (₩61,250) and below its 60-day moving average (₩63,683). 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 56.1, a neutral level. The one-month change is +3.6%, the three-month change is -4.4%, and the position relative to the 52-week high is -25.4%. Relative strength versus the KOSPI is 30 (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 30% of all stocks. Over the past three months it lagged the index by 24.5%. 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 -24.50% / 6M -39.85% / 12M -57.33%
Key metrics vs whole-market median
Valuation
The P/E of 36.29x is above the whole-market median (13.81x). The P/B of 0.72x 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 9.2%, initial growth 2.0%→terminal 2.0%, 10-yr forecast, free-cash-flow basis, forward earnings power normalized 1.004x. A reference range that shifts materially with assumptions.
Profitability & financials
Return on equity (ROE) is 2.0%, below the whole-market average (5.0%). The operating margin is 9.0%. The debt ratio is 14.6%, so the financial structure is stable.
Growth FY2025 · annual report (separate)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $83.9M | $59.8M | $64.9M | +8.46% ↑ faster |
| Operating profit | $4.2M | $4.8M | $5.8M | +21.64% ↑ faster |
| Net profit | $6.0M | $8.4M | $7.6M | -8.44% ↓ slower |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $69.1M | $80.9M | $83.9M | $59.8M | $64.9M |
| Operating profit | $7.3M | $336,373 | $4.2M | $4.8M | $5.8M |
| Net profit | $7.4M | $4.0M | $6.0M | $8.4M | $7.6M |
| Revenue CAGR | 4-yr avg -1.56% | ||||
Revenue rose 8.5% year over year (2023 ₩126.6 billion → 2024 ₩90.2 billion → 2025 ₩97.9 billion), and the three-year trend is 'mixed'. The pace of growth also quickened from the prior year. Operating profit rose 21.6% year over year. Profit is growing at an accelerating pace. Over the 5 years on record, revenue compound annual growth (CAGR) is -1.6%. The two-year revenue CAGR is -12.1%. In the most recent quarter (Q1 2026), revenue was 18.9% lower than the same period a year earlier.
Latest quarterly results Q1 2026 · vs year-ago
Technical indicators
What stands out
- The balance sheet is stable in terms of debt and liquidity.
Points to watch
- The price is high versus peers, so expectations already appear priced in.
Recent news & events searched · sourced
- 2026-05-15EarningsFiling of the Q1 2026 quarterly report - revenue of 20.9 billion won (-18.9% YoY) and operating profit of 1.6 billion won (-35.2%), confirming a joint softening of the top line and core operating profitShort term: weakening core momentum confirmed in numbers. Net profit rose +8.5% on non-operating gains, so the directions of core and overall earnings diverged. Source
- 2026-03-19EarningsFiling of the 2025 annual report - annual revenue of 97.9 billion won (+8.5%), operating profit of 8.8 billion won (+21.6%), and net profit of 11.5 billion won, confirming a recovery in core profitabilityMedium term: officially confirms the core-recovery trend since the 2022 trough (0.5 billion won of operating profit). Revenue remains low versus the 2023 peak. Source
- 2026-03-27FilingResults of the regular general meeting and reports on outside-director appointments and mid-term departures - a change in board compositionMedium term: a governance-change item. Direct impact on results and cash flow is limited, but a point to watch alongside any change in board composition and dividend policy. Source
- 2026-03-16UpdateFiling of a large-holding report (short form) - a change in a major shareholder's stakeShort term: as a thinly traded stock, a change in a major shareholder's stake can affect supply and demand, so separate confirmation is needed. Source
- 2026-06-01FilingDisclosure of the corporate-governance report - regular disclosure of governance statusMedium term: low price-triggering potential but regular material for checking information on shareholder returns and board operations. Source
Figure cross-check computed ↔ external
Recent filings
- 2026-06-01Corporate governance report
- 2026-05-15PeriodicQuarterly report
- 2026-03-27Disclosure
- 2026-03-27Shareholders' meeting notice
- 2026-03-23Amended filing
- 2026-03-23Amended filing
- 2026-03-19PeriodicAnnual business report
- 2026-03-19Audit report
- 2026-03-16OwnershipOwnership-change filing
- 2026-03-12Shareholders' meeting notice
- 2026-03-12Shareholders' meeting notice
- 2026-03-12Shareholders' meeting notice
📖 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.