Kwangdong Pharmaceutical is classified as pharma and bio, but its actual revenue comes more from beverages, bottled water, and distribution, such as consignment sales of Jeju Samdasoo, Vita500, and corn-silk tea, with pharmaceuticals and health distribution layered on top, a diversified business generating annual revenue of ₩1,659.5 billion at an operating margin of 1.9%, selling a lot but on thin margins. In December 2025 it disposed of about 6.64 million treasury shares (roughly 13%) off-market to buyers including Dongwon Systems, Huons, and Daewoong for a total of about ₩39.7 billion; in February 2026 it decided on a +3.2% rise in operating profit (pre-tax profit fell -42.2% as a prior-year one-off gain rolled off) and a dividend of ₩100 per share, and Q1 operating profit more than doubled year on year. The key point to watch: at a P/B of 0.41x it trades at half of net assets, and with an earnings rebound in Q1 sitting atop the steady cash flow of Samdasoo and Vita500, the forward P/E of 9.67x is below the trailing figure (12.9x); against that, an operating margin of 1.9% and ROE of 3.2% make absolute profitability thin, and interest coverage of 1.43x means the crux is whether the earnings improvement carries into the second half.
At-a-glance assessment financial health · growth · profitability · valuation
- Debt is somewhat higher than equity (debt ratio 201.4%).
- Revenue rose 1.1% year over year, and the pace is slowing (3-year trend: rising).
- Most recent quarter (Q1 2026) revenue was 8.8% higher than a year earlier.
- ROE is 3.2% (controlling-interest basis). It is above the sector average.
- Operating margin is 1.9%.
- The forward P/E sits above the sector median, reflecting elevated expectations.
Ownership & governance As of 2021-12-31
Largest shareholder Choi Sung-won 6.59% (individual)
Controlling bloc incl. related parties 8.36%
With the controlling bloc holding 8%, ownership is dispersed, leaving room for control-related or activist dynamics.
🔎 In-depth analysis
- Kwangdong Pharmaceutical is grouped under pharma and bio in classification terms, but its actual revenue comes more from beverages, bottled water, and distribution than from drugs.
- Representatively, consignment sales of Jeju Samdasoo (bottled water), Vita500 (a vitamin drink), and beverages such as corn-silk tea and hovenia tea form the large axis of revenue, with over-the-counter and prescription drugs and B2B medical and health distribution added on top.
- That is why annual revenue is large at ₩1,659.5 billion while the operating margin is low at 1.9%.
- This reflects the trait of the bottled-water and beverage distribution business of "selling a lot but on thin margins," so rather than a drug seller, it is closer to reality to see it as a diversified business with a pharma operation layered atop beverage and distribution revenue.
- In return, it has the strength that recession-resistant staple-goods revenue like Samdasoo and Vita500 generates steady cash flow.
- The latest close is ₩6,100 and the market cap is ₩303.8 billion.
- The price sits above the 20-day line (₩5,894) and below the 60-day line (₩7,026).
- With the short- and mid-term trends diverging, the direction should be read on both sides.
- The RSI (an auxiliary gauge that weighs up-days against down-days over the past 14 days on a 0-100 scale) is 48.5, a neutral level.
- The one-month change is -0.7%, the three-month change is -23.9%, and the position versus the 52-week high is -45.0%.
- Relative strength versus the KOSPI is 33 (on a 1-99 scale that converts one-year return against the index with recent performance weighted more heavily; higher means stronger than the market).
- That places it around the top 67% of all stocks by strength.
- Over the past three months it has lagged the index by 41.9%.
- Chart readings are best considered alongside trading volume and disclosure dates.
- On confirmed FY2025 results, the P/E (price divided by one year of net profit) is 14.49x, the P/B (price divided by net assets) is 0.46x, ROE (the return earned on equity in a year) is 3.2%, the operating margin is 1.9%, and the debt ratio is 201.4%.
- A P/B of 0.41x means the stock is priced below even half of the company's net assets, clearly a cheap range on asset value.
- The P/E of 12.9x is also on a trailing basis (last year's confirmed results) but is low against the peer set.
- A point to note here is that last year's net profit was temporarily depressed.
- In FY2025, operating profit rose +3.2%, yet net profit fell as the prior year's non-operating one-off gain rolled off.
- In other words, the core business is fine and only net profit was lowered by a one-off factor, an inflection point, so evaluating the company on last year's figures alone risks underrating its real earnings power.
- A debt ratio of 201% looks high, but a large share of it is working-capital in nature, such as trade payables from the bottled-water and beverage distribution business, and differs in character from pure borrowing burden.
- That said, interest coverage (the capacity to cover interest with operating profit) is not thick at 1.43x, so it is best to watch alongside whether earnings recover.
- Over five years, revenue rose gently from ₩1.3 trillion in 2021 to ₩1.7 trillion in 2025 (a 5.5% annual average), and the most recent one-year growth of +1.1% shows the pace of top-line growth has calmed.
- Over the same period, operating profit moved around similar levels with little change, stemming from the thin-margin structure of bottled-water and beverage distribution.
- This year, though, is different in tone.
- In Q1 2026, revenue was ₩410.9 billion (+8.8%) and operating profit ₩7.5 billion (+127.3%), with profit rising far faster than revenue, a signal of improving profitability.
- Net profit also rose +20.7% year on year.
- A thin-margin business has leverage in which a small rise in revenue makes profit jump a lot, and Q1 is exactly that picture.
- The forward P/E reflecting this earnings flow, on this year's expected basis, is 9.67x, below last year's trailing P/E (12.9x).
- This points to a picture of "this year's earnings rising above last year's" and is low even against pharma and consumer-goods peers.
- In short, even with modest top-line growth, earnings are turning up again this year, and that improvement can be seen as not yet fully reflected in the valuation.
- The recent flow has three cores.
- First, on December 24, 2025, the company disposed of about 6.64 million treasury shares (roughly 13% of shares outstanding) off-market to buyers including Dongwon Systems, Huons, and Daewoong at ₩5,980 per share, for a total of about ₩39.7 billion.
- As this was not a simple cash-out but a transaction handed to counterparties of a business-partner character, the cooperative relationship and change in ownership structure are points to check together.
- Second, in the provisional settlement disclosure of February 10, 2026, it was confirmed that operating profit rose +3.2% but pre-tax profit fell -42.2% as the prior year's non-operating one-off gain dropped out.
- Since this stems from a base-effect difference in one-off items rather than a worsening core business, this point must be kept in mind when reading last year's net-profit-based metrics.
- Third, on February 23, it decided on a cash dividend of ₩100 per share (a yield of about 1.1% at the time, totaling about ₩4.97 billion) and also resolved to adopt electronic voting (maintaining a shareholder-return stance with a payout ratio of about 23.7%).
- On March 26, it decided on an additional treasury-share disposal from stock-option exercise (a spread-compensation type, about 41,586 shares); unlike the December block trade, its small scale means limited impact.
- The strengths are clear.
- At a P/B of 0.41x it trades in an asset-undervaluation range at half of net assets, and recession-resistant bottled-water and beverage revenue like Samdasoo and Vita500 supports steady cash flow and a dividend in the 1% range.
- Above all, Q1 operating profit more than doubled year on year, showing the early stage of an earnings rebound, and the forward P/E of 9.67x reflecting this is even below last year's trailing (12.9x), suggesting the flow of rising earnings this year is not yet fully reflected in the share price.
- There are cautions too.
- With an operating margin of 1.9% and ROE of 3.2%, absolute profitability itself is thin, and interest coverage of 1.43x means the financial cushion is not ample.
- In sum, if the margin improvement seen in Q1 continues through the year, it stands out as a stock cheap on both asset and earnings measures, whereas if the earnings improvement proves to be merely a temporary base effect, the thin margin and working-capital burden could come to the fore again.
- The crux is whether the earnings recovery that began in Q1 carries into the second half.
🔎 Valuation vs peers Inconclusive
Unlike large bio firms such as Samsung Biologics and Celltrion, Kwangdong Pharmaceutical is a traditional small-to-mid-cap pharma and consumer-goods company with a large beverage and distribution weight. Dongwha Pharm, Bukwang Pharm, and Daewon Pharmaceutical, closer in business and scale, were set as the direct peer set, with the beverage and distribution character taken into account as well.
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| Dong Wha Pharm | 15.98x | 0.37x | 2.29% |
| Bukwang Pharmaceutical | 30.56x | 1.13x | 3.69% |
| Daewon Pharmaceutical | — | 0.67x | -0.52% |
(a) Position versus the true peer set: a P/B of 0.48x and a P/E of 15.2x, along with Dongwha Pharm, sit at the bottom of the peer set, with both asset and earnings multiples on the low side. (b) Discount factors: with beverage and distribution taking a large weight, the operating margin is thin at 1.9% and ROE is just 3.2%, so the low multiples partly reflect profitability. This is why low multiples alone do not simply mean "cheap." (c) Limits of trailing and the forward basis: last year's P/E of 15.2x is on FY2025 net profit (₩21.0 billion), but with operating profit up +3.2% while net profit plunged on a non-operating one-off difference, this is an inflection point where trailing can be distorted. With no official company forecast, approximating this year via DART quarterly seasonality gives net profit of about ₩14.1 billion and a forward P/E of about 22.5x, which is actually higher. In other words, the low P/E on last year's basis may not hold on this year's basis, so until the direction of margin and non-operating variables is confirmed, we do not declare undervaluation and leave it Inconclusive.
Earnings outlook company-stated · verified
| Type | Period | Revenue | Operating profit | Net profit |
|---|---|---|---|---|
| Next quarter | Q2 2026 | approx. ₩434.5 billion | approx. ₩4.3 billion | approx. ₩1.9 billion |
Price history Close · MA20 · MA60
The latest close is ₩6,100 and the market capitalization is ₩303.8 billion. The price sits above its 20-day moving average (₩5,894) and below its 60-day moving average (₩7,026). 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 48.5, a neutral level. The one-month change is -0.7%, the three-month change is -23.9%, and the position relative to the 52-week high is -45.0%. Relative strength versus the KOSPI is 33 (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 33% of all stocks. Over the past three months it lagged the index by 41.9%. 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 -41.86% / 6M -35.18% / 12M -56.62%
Key metrics vs sector median
Valuation
The P/E of 14.49x is in line with the sector median (15.98x). The P/B of 0.46x is below the sector median (1.37x). 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.
Intrinsic value (DCF estimate)
DCF (discounted cash flow) estimate — discount rate 11.6%, initial growth 2.0%→terminal 2.0%, 10-yr forecast, free-cash-flow basis, forward earnings power normalized 0.674x. A reference range that shifts materially with assumptions.
Profitability & financials
Return on equity (ROE) is 3.2%, in line with the sector average (3.0%). The operating margin is 1.9%. The debt ratio is 201.4%, so the financial structure is somewhat high.
Growth FY2025 · annual report (consolidated)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $1.0B | $1.1B | $1.1B | +1.15% ↓ slower |
| Operating profit | $27.9M | $19.9M | $20.6M | +3.15% ↑ faster |
| Net profit | $24.5M | $26.8M | $13.9M | -48.20% ↓ slower |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $886.9M | $948.8M | $1.0B | $1.1B | $1.1B |
| Operating profit | $29.8M | $25.3M | $27.9M | $19.9M | $20.6M |
| Net profit | $15.9M | $16.0M | $24.5M | $26.8M | $13.9M |
| Revenue CAGR | 4-yr avg 5.53% | ||||
Revenue rose 1.1% year over year (2023 ₩1.5 trillion → 2024 ₩1.6 trillion → 2025 ₩1.7 trillion), and the three-year trend is 'rising'. That said, the pace of growth slowed from the prior year. Operating profit rose 3.1% year over year. Profit is growing at an accelerating pace. Over the 5 years on record, revenue compound annual growth (CAGR) is 5.5%. The two-year revenue CAGR is 4.7%. In the most recent quarter (Q1 2026), revenue was 8.8% higher than the same period a year earlier.
Latest quarterly results Q1 2026 · vs year-ago
Technical indicators
What stands out
- —
Points to watch
- Revenue rose 1.1% year over year, and the pace is slowing (3-year trend: rising).
- The price is high versus peers, so expectations already appear priced in.
Recent news & events searched · sourced
- 2025-12-24UpdateOff-market disposal of about 6.64 million treasury shares (roughly 13% of shares outstanding) completed to buyers including Dongwon Systems, Huons, and Daewoong at ₩5,980 per share, totaling about ₩39.7 billionA large transaction handed to counterparties of a business-partner character rather than a simple cash-out, a matter where the cooperative relationship and change in ownership structure should be checked together. Depleting treasury shares can increase floating supply (mid term). Source
- 2026-02-10EarningsFY2025 provisional settlement: revenue ₩1,659.5 billion (+1.1%) and operating profit ₩31.0 billion (+3.2%), but pre-tax profit ₩33.1 billion (-42.2%) with net profit sharply lowerThe core business (operating profit) improved slightly, but net profit plunged as the prior year's non-operating one-off gain disappeared. Last year's P/E can look lower than reality, so a forward perspective is needed (short term). Source
- 2026-02-23DividendYear-end cash dividend of ₩100 per share (yield about 1.1%, total about ₩4.97 billion) decided, record date 2026-04-01; adoption of electronic voting also resolved the same dayA shareholder-return stance maintained with a payout ratio of about 23.7%. Electronic voting is a meeting-convenience matter, unrelated directly to business and results (mid term). Source
- 2026-03-26UpdateTreasury-share disposal from stock-option exercise (spread-compensation type) decided, with about 41,586 shares actually deliveredA small delivery for the purpose of executive stock-option spread compensation; unlike the December block trade, its market impact is limited (short term). Source
Figure cross-check computed ↔ external
| Metric | Computed | External | Status | Source |
|---|---|---|---|---|
| FY2025 revenue (consolidated) | 1₩659.5 billion | 1,659,512,458 | Confirmed | link |
| FY2025 operating profit (consolidated) | ₩31.0 billion(+3.2%) | 31,045,848(+3.2%) | Confirmed | link |
| FY2025 pre-tax profit change | net profit YoY -48.2% | 573→331(-42.2%) | Confirmed | link |
| Year-end dividend per share | ₩100(DPS, base) | ₩100· ₩4,966,097,400 | Confirmed | link |
| This year's net profit (seasonality approximation) | approx. ₩14.1 billion | — | Unverified | link |
Recent filings
- 2026-05-29Corporate governance report
- 2026-05-15PeriodicQuarterly report
- 2026-04-14OwnershipOwnership-change filing
- 2026-03-26TreasuryMaterial-fact report
- 2026-03-26Disclosure
- 2026-03-26Shareholders' meeting notice
- 2026-03-18PeriodicAnnual business report
- 2026-03-18Audit report
- 2026-03-10OwnershipOfficers'/major-shareholders' holdings report
- 2026-03-10OwnershipOfficers'/major-shareholders' holdings report
- 2026-03-10OwnershipOfficers'/major-shareholders' holdings report
- 2026-03-10OwnershipOfficers'/major-shareholders' holdings report
📖 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.