Korea Petrochemical Ind. cracks naphtha into ethylene and propylene and processes them into HDPE and PP for sale, with stable feedstock sourcing thanks to vertical integration across its Ulsan and Onsan complexes; it is growing higher-value specialties such as PE for battery separators and flame-retardant PP for ESS, and from Q2 2025 it consolidated its LNG-power and salt subsidiary Hanju at a 51% stake. In its Q1 2026 preliminary results on April 29, 2026, it confirmed an earnings rebound with operating profit of ₩73.6 billion and a large increase in net profit; in March it made a voluntary corporate value-up disclosure, and its dividend is ₩1,300 per share (a 25.3% payout ratio). What stands out now is that a P/B of 0.39x, a large discount to book equity, along with net cash, a 17.3% FCF yield, a spread rebound, and the higher earnings level from the Hanju consolidation are strengths; but Q1 earnings mix in the timing effect of cheaply purchased naphtha, which could reverse once market conditions normalize.
At-a-glance assessment financial health · growth · profitability · valuation
- Debt ratio, current ratio and interest burden all look healthy.
- Revenue rose 19.6% year over year, and the pace is quickening (3-year trend: rising).
- Net profit swung from a loss a year earlier back into the black (a turnaround).
- Most recent quarter (Q1 2026) revenue was 14.2% higher than a year earlier.
- ROE is 1.7% (controlling-interest basis). It is below the sector average.
- Operating margin is 1.6%.
- The forward P/E sits below the sector median.
Ownership & governance As of 2024-12-31
Largest shareholder Lee Soon-kyu 2.55% (individual)
Controlling bloc incl. related parties 7.92%
With the controlling bloc holding 8%, ownership is dispersed, leaving room for control-related or activist dynamics.
🔎 In-depth analysis
- It cracks naphtha to make base fractions such as ethylene and propylene.
- It is a company that then processes these into high-density polyethylene (HDPE) and polypropylene (PP) for sale.
- Because it has a vertically integrated structure running from feedstock to finished product within its Ulsan and Onsan complexes, its sourcing is more stable than makers that buy feedstock from outside.
- Recently it has been raising the share of higher-value specialties such as PE for battery separators, flame-retardant PP for ESS modules, and PP for capacitors.
- From Q2 2025 it raised its stake in Hanju, a subsidiary running an LNG-power and salt business in Ulsan, to 51% and consolidated it.
- This utilities segment has been added as a new source of income.
- The latest close is ₩101,500 and market capitalization is ₩659.8 billion.
- The price sits below the 20-day line (₩117,815) and below the 60-day line (₩136,682).
- Trading beneath both the short- and medium-term moving averages, the trend is on the soft side.
- The RSI (a supplementary gauge that compares upward and downward strength over the last 14 days on a 0-100 scale) is 34.8, a neutral level.
- The one-month change is -15.1%, the three-month change is -27.0%, and the position versus the 52-week high is -46.8%.
- Relative strength versus the KOSPI is 23 (1-99, computed from returns against the index over the past year with recent performance weighted more heavily; higher means stronger than the market).
- That places it in roughly the top 77% of all stocks by strength.
- Over the last three months it lagged the index by 47.6%.
- Chart readings are best viewed alongside trading volume and the dates on which disclosures occur.
- The P/B (the price divided by net assets per share) is 0.36x.
- That is a price below even half of book equity.
- Equity is ₩1.8349 trillion, while market cap is only ₩719.6 billion.
- The debt ratio (debt relative to equity) is low at 33.7%.
- Net debt is -₩120.9 billion, a net-cash position with more cash than debt.
- The FCF yield (the ratio of cash actually generated to market cap) is high at 17.3%, so cash-generating power is ample relative to the share price.
- EV/EBIT (enterprise value divided by operating profit, a debt-inclusive counterpart to the P/E) is 11.4x.
- On a 2025 basis, the P/E of 22.7x and ROE (how much is earned in a year on equity) of 1.7% look high or low.
- But that is because these are early-recovery figures with earnings having just turned up off the bottom.
- Revenue in 2025 was ₩3.3478 trillion, up 19.6% from the prior year.
- Growth has been gaining pace for a third year.
- Operating profit went from -₩214.6 billion in 2022, through losses in 2023 and 2024, to a swing to a profit of ₩52.7 billion in 2025.
- Net profit also turned to ₩31.7 billion in 2025.
- In Q1 2026 it posted revenue of ₩847.1 billion (+14.2%) and operating profit of ₩73.6 billion.
- In a single quarter it surpassed last year's full-year operating profit.
- Expansion of specialty products and the Hanju consolidation are structural improvement factors.
- A phase in which downstream oversupply eases as capacity shutdowns expand is also favorable to spreads.
- Reflecting this flow, this year's net profit is at a level well above last year's ₩31.7 billion.
- As a result, the forward P/E relative to market cap falls to about 7x.
- In other words, even though the P/E on last year's results looks high, on this year's earnings it is a much cheaper stretch.
- The most important official event is the Q1 2026 preliminary results announced on April 29, 2026.
- It confirmed an earnings rebound with operating profit of ₩73.6 billion and a large year-on-year increase in net profit.
- On March 13 it voluntarily disclosed a corporate value-up plan, laying out a direction for shareholder returns and improving corporate value.
- The dividend is being maintained at ₩1,300 per share, a 25.3% payout ratio.
- In May, reports related to the largest shareholder's holdings followed.
- The flow of disclosures is aligned toward an earnings rebound and strengthened shareholder returns.
- The strengths are clear.
- At a P/B of 0.39x, it is heavily discounted to book equity.
- Its balance sheet is solid, with net cash and a 17.3% FCF yield.
- Earnings, after the 2025 swing to profit, moved up a level in Q1 2026 on a spread rebound and the Hanju consolidation.
- Specialty products add an earnings base unrelated to general market conditions.
- There are also points to note.
- Q1 earnings mix in a timing effect in which product prices jumped while the company was using naphtha bought cheaply before the war.
- This portion could reverse once market conditions normalize.
- There is also a view that the petrochemical industry itself will take time to reach a full recovery.
- In sum, the undervaluation appeal is large in a phase where spreads and utilities earnings hold up, while this is a stock whose earnings volatility grows if the timing effect unwinds quickly.
🔎 Valuation vs peers Undervalued
Compared against domestic petrochemical companies in the naphtha cracking (NCC), olefins, and polyolefins businesses.
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| Lotte Chemical | 0.00x | 0.21x | -16.19% |
| SK Chemicals | 15.81x | 0.31x | 1.98% |
Same-industry petrochemical peers such as Lotte Chemical (P/B 0.22, loss-making) and SK Chemicals (P/B 0.32) are mostly in a low-P/B, low-ROE stretch. Korea Petrochemical is within that flow too, at a P/B of 0.39x. The difference, though, is that its earnings have already turned. The 2025 P/E of 22.7x looks high, but because it is based on the low earnings just after the swing to profit, it overstates the actual valuation. Reflecting that Q1 2026 operating profit already surpassed last year's full-year figure, the forward P/E falls to about 7x. Taking together the net-cash position and the 17.3% FCF yield, this can be seen as a stretch undervalued relative to assets and cash in an earnings-recovery phase.
Price history Close · MA20 · MA60
The latest close is ₩101,500 and the market capitalization is ₩659.8 billion. The price sits below its 20-day moving average (₩117,815) and below its 60-day moving average (₩136,682). It is under both its short- and medium-term moving averages, so the trend looks subdued. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 34.8, a neutral level. The one-month change is -15.1%, the three-month change is -27.0%, and the position relative to the 52-week high is -46.8%. Relative strength versus the KOSPI is 23 (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 23% of all stocks. Over the past three months it lagged the index by 47.6%. 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 -47.60% / 6M -53.30% / 12M -53.41%
Key metrics vs sector median
Valuation
The P/E of 20.81x is above the sector median (14.79x). The P/B of 0.36x is below the sector median (0.97x). 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 1.7%, below the sector average (4.0%). The operating margin is 1.6%. The debt ratio is 33.7%, so the financial structure is stable.
Growth FY2025 · annual report (consolidated)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $1.7B | $1.9B | $2.2B | +19.56% ↑ faster |
| Operating profit | -$41.3M | -$39.7M | $34.9M | — |
| Net profit | -$19.2M | -$5.7M | $21.0M | — |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $1.7B | $1.5B | $1.7B | $1.9B | $2.2B |
| Operating profit | $118.9M | -$142.3M | -$41.3M | -$39.7M | $34.9M |
| Net profit | $99.4M | -$98.8M | -$19.2M | -$5.7M | $21.0M |
| Revenue CAGR | 4-yr avg 7.41% | ||||
Revenue rose 19.6% year over year (2023 ₩2.5 trillion → 2024 ₩2.8 trillion → 2025 ₩3.3 trillion), and the three-year trend is 'rising'. The pace of growth also quickened from the prior year. Over the 5 years on record, revenue compound annual growth (CAGR) is 7.4%. The two-year revenue CAGR is 15.7%. In the most recent quarter (Q1 2026), revenue was 14.2% 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 19.6% year over year, a sign of growth.
- The balance sheet is stable in terms of debt and liquidity.
Points to watch
- The figures shown are based on the last annual report as of the writing date, so it is best to review the latest quarterly results and filings alongside them.
Recent news & events searched · sourced
- 2026-04-29EarningsQ1 2026 consolidated preliminary results disclosure — operating profit ₩73.6 billion, with a large increase in net profit confirming an earnings reboundStrengthens near-term earnings momentum. The spread rebound and the Hanju consolidation effect show up in the numbers. Source
- 2026-03-13IRVoluntary disclosure of a corporate value-up plan — laying out a direction for shareholder returns and improving corporate valueExpectation of improved dividends and capital efficiency over the medium term. A signal for resolving the low P/B. Source
- 2026-03-05Filing2025 annual report filed — consolidated revenue ₩3.3478 trillion (+19.6%), operating profit ₩52.7 billion, confirming a swing to profitConfirms a turning point out of the loss cycle. Dividend maintained at ₩1,300 per share. Source
- 2026-05-15FilingQ1 2026 quarterly report filed — consolidated results reflecting the Hanju utilities segmentAllows confirmation of the durability of the Hanju consolidation effect. Adds a utilities earnings base. Source
Figure cross-check computed ↔ external
Recent filings
- 2026-06-05OwnershipOfficers'/major-shareholders' holdings report
- 2026-05-29Corporate governance report
- 2026-05-19OwnershipLargest-shareholder ownership change report
- 2026-05-15PeriodicQuarterly report
- 2026-04-29EarningsFair-disclosure notice
- 2026-04-02OwnershipOfficers'/major-shareholders' holdings report
- 2026-04-01OwnershipOwnership-change filing
- 2026-03-13Shareholders' meeting notice
- 2026-03-13Disclosure
- 2026-03-13Disclosure
- 2026-03-05PeriodicAnnual business report
- 2026-02-23Shareholders' 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.