HD Korea Shipbuilding & Offshore Engineering (009540) 🔎 In-depth
KOSPI · Price as of 2026-08-06 · Updated 2026-08-09
HD Korea Shipbuilding & Offshore Engineering is the intermediate holding company of Korea's largest shipbuilding group, holding about a 69% stake in HD Hyundai Heavy Industries and the entirety of unlisted HD Hyundai Samho Heavy Industries, and pulling in the profits those units earn from selling ships in proportion to its stakes. In the first quarter of 2026 it reported consolidated revenue of ₩8.1409 trillion and operating profit of ₩1.3560 trillion (up 20% and 58% respectively from a year earlier), for a 16.7% operating margin, and it booked $6.4 billion of new shipbuilding orders in the first quarter alone against a full-year target of $17.0 billion. The most notable point is that the value of its listed subsidiary stakes alone exceeds ₩34 trillion, well above its market cap of ₩23.7 trillion — a deep holding-company discount. While the shipbuilding upcycle led by LNG carriers continues, the appeal of undervaluation, backed by a 3.7% dividend and a net cash position, is large; but if newbuilding prices or new orders turn down, the shares can wobble along with subsidiary earnings.
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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 “Shipbuilding (Intermediate Holdco)” (Shipbuilding, Machinery, Defense & Power Equipment), a type typically read first through P/B.
A shipbuilding intermediate holding company mainly owns stakes in subsidiaries and businesses, so the value of those holdings and assets reflects its substance more than its own earnings. Price-to-book (P/B) — the price against asset value — is therefore the first lens, read together with how much the market discounts it against net asset value (the discount to NAV).
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
- For financial companies, debt and interest costs are large by the nature of the business, so the debt ratio and interest coverage cannot be read on the same yardstick as an ordinary company.
- Revenue rose 17.2% year over year, and the pace is slowing (3-year trend: rising).
- Most recent quarter (Q1 2026) revenue was 20.2% higher than a year earlier.
- ROE is 19.9% (controlling-interest basis). It is above the sector average.
- Operating margin is 14.1%.
- A sector-metric and in-depth research verdict — see “Valuation vs peers” below for the basis.
Ownership & governance As of 2025-12-31
Largest shareholder HD Hyundai 35.05% (corporate)
Controlling bloc incl. related parties 36.64%
With the controlling bloc holding 37%, the ownership structure is stable.
Net asset value (NAV) assessment 25% discount to NAV
💡 How to read a holding company · A holding company owns stakes in several subsidiaries. Its P/E swings with equity-method gains and losses on those stakes, so read it only as a rough guide. P/B is more meaningful because subsidiary stakes sit in equity, but book value carries them at low historical cost (so P/B looks higher than reality). The most accurate view is the price against the market value of those stakes (NAV) ↓
Valued against the net asset value (NAV) of its listed holdings rather than a consolidated P/E — see the in-depth valuation for the detailed basis.
Listed subsidiaries ownership
| HD Hyundai Heavy Industries | 69.23% |
| HD Hyundai Energy Solutions | 53.57% |
🔎 In-depth analysis Reading
HD Korea Shipbuilding & Offshore Engineering does not build ships directly. It is an intermediate shipbuilding holding company that oversees the subsidiaries that do. Its core subsidiaries are listed HD Hyundai Heavy Industries (about a 69% stake) and unlisted HD Hyundai Samho Heavy Industries (a 100% stake). The revenue and profit these units earn making merchant ships such as LNG carriers, container ships and tankers, along with marine engines and offshore plants, are combined on a consolidated basis as this company's results. By segment in 2025, shipbuilding accounted for most of it, with revenue of ₩25 trillion and operating profit of ₩3.3 trillion. Engines and machinery added revenue of ₩4.3 trillion, and offshore plants added ₩1.2 trillion. Ultimately, this company's value comes not from 'what the holding company itself earns' but from 'the results and stake value of the shipbuilding subsidiaries it oversees.'
The latest close is ₩400,000 and the market capitalization is ₩28.3 trillion. The price sits above its 20-day moving average (₩358,450) and above its 60-day moving average (₩382,967). 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 58.5, a neutral level. The one-month change is +11.0%, the three-month change is -11.6%, and the position relative to the 52-week high is -16.6%. Relative strength versus the KOSPI is 29 (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 28% of all stocks. Over the past three months it outpaced the index by 1.8%. Chart interpretation is best done alongside trading volume and the dates on which disclosures occur.
Profitability and the balance sheet directly reflect the shipbuilding upcycle. ROE (how much is earned in a year on equity) is a healthy 16.3%, and the operating margin is 13.0%. On valuation, the P/E ratio (how many times one year's net profit the price represents) is 13.06x and the P/B (how many times book net assets the price represents) is 2.09x. For a holding company, though, these two metrics should not be read at face value, because subsidiary stakes are carried on the books at acquisition cost, which makes equity look smaller than the true net asset value and, in turn, makes the P/B appear higher than it really is. Financial strength is solid: net debt (total borrowings minus cash; negative means net cash) is -₩3.3 trillion, a net cash position with more cash than debt. EV/EBIT (enterprise value divided by operating profit, a debt-adjusted counterpart to P/E) is a low 5.7x. The FCF yield (cash actually generated relative to market cap) is a high 13.3%, reflecting strong cash generation. The dividend yield is 3.7% (₩12,300 per share, a 40.1% payout ratio), an unusual dividend appeal among the large shipbuilders.
The pace of earnings improvement is steep. Full-year 2025 revenue rose 17.2% from the prior year to ₩29.9333 trillion, and operating profit surged 172.3% to ₩3.9045 trillion. After the losses of 2021-2022, the company turned to a profit in 2023, and it has since been in a recovery-and-growth phase in which profit steps up in stages. That momentum carries into 2026: first-quarter consolidated net profit was ₩1.1414 trillion, up 86.6% year on year, and the operating margin rose from 13.0% for full-year 2024 to 16.7%. In its results release the company described the improvement as a 'stable improvement with no one-off factors,' meaning that as high-priced order volumes are recognized in earnest, profitability is improving structurally. Shipbuilding is an industry that now builds and sells ships ordered years ago, so the high-priced volumes stacked in the order backlog will continue to be recognized as revenue in sequence. Given this, this year's earnings look set to be clearly higher than last year's. The current 10.9x P/E is based on last year's profit, so on this year's earnings it should be viewed as even lower (cheaper).
Disclosures cluster around orders and dividends. Across May and June 2026, single sale-and-supply contract (ship order) disclosures came out one after another. In the first quarter alone the shipbuilding affiliates booked a total of $6.4 billion of orders, about 37% of the full-year target ($17.0 billion), with individual order contracts confirmed by disclosure. On dividends, the company decided to pay ₩12,300 per share for the fiscal 2025 year-end dividend, linking rising profit to shareholder returns. On governance, in December 2025 subsidiaries HD Hyundai Heavy Industries and HD Hyundai Mipo merged into a combined HD Hyundai Heavy Industries. After the merger, this company's stake in the combined HD Hyundai Heavy Industries is about 69%. This simplified the shipbuilding business into a single listed subsidiary, making the holding company's stake-value structure clearer.
Two things are central to viewing this company. The first is the results of the shipbuilding subsidiaries. As long as the shipbuilding upcycle led by LNG carriers continues and the order backlog is stacked years deep, the high-priced volumes booked as orders are recognized as revenue and profit in sequence, improving results. First-quarter net profit of +86.6% and a 16.7% operating margin are the evidence. The second is the holding-company discount. The stake in listed subsidiary HD Hyundai Heavy Industries alone is worth more than ₩34 trillion at market value, yet this company's own market cap is only ₩24 trillion. Adding unlisted HD Hyundai Samho Heavy Industries and ₩3.3 trillion of net cash widens the gap between true net asset value and the share price further. The supportive case is clear: as long as the shipbuilding backdrop holds, profit grows, net cash and the 3.7% dividend support the downside, and the deep holding-company discount widens the room for undervaluation. The cautions are just as clear: if newbuilding prices turn down or new orders slow, subsidiary earnings wobble, and because of its holding-company nature the share price tends to move in step with its subsidiaries' shares. In the end, the direction of the shipbuilding cycle is the axis that divides this company's value.
🔎 Valuation vs peers Undervalued
Compared together with the large shipbuilders that build ships directly (HD Hyundai Heavy Industries, Hanwha Ocean, Samsung Heavy Industries) and the top group holding company with a similar holding-company-discount structure (HD Hyundai).
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| HD Hyundai Heavy Industries | 37.60x | 5.48x | 19.61% |
| Hanwha Ocean | 22.31x | 4.07x | 22.43% |
| Samsung Heavy Industries | 35.65x | 4.31x | 12.31% |
| HD Hyundai | 17.97x | 1.58x | 20.21% |
A holding company pulls in its subsidiaries' profits in proportion to its stakes, so it is more accurate to view it through the 'market value of the stakes it holds' than through consolidated P/E and P/B. The market value of the stake in listed subsidiary HD Hyundai Heavy Industries (about 69%) alone is roughly ₩34 trillion, while this company's market cap is only about ₩24 trillion. Adding unlisted HD Hyundai Samho Heavy Industries (₩1.36 trillion of operating profit in 2025) and ₩3.3 trillion of net cash widens the gap between true net asset value and the share price further. This is a deep discount, near the upper end of the discount typically applied to holding companies (30-50%). For reference, subsidiary HD Hyundai Heavy Industries trades at a P/E of 34.9x, Hanwha Ocean at 20.2x and Samsung Heavy Industries at 35.3x — high relative to their profits — while this company carries the same shipbuilding profit at a far lower level. The 10.9x P/E on last year's profit also falls further once this year's earnings improvement is reflected. For these reasons the read is undervaluation. That said, this discount holds while the shipbuilding backdrop holds, and if the cycle turns down, both subsidiary stake value and profit shrink together, which warrants caution.
Price history Close · MA20 · MA60
The latest close is ₩400,000 and the market capitalization is ₩28.3 trillion. The price sits above its 20-day moving average (₩358,450) and above its 60-day moving average (₩382,967). 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 58.5, a neutral level. The one-month change is +11.0%, the three-month change is -11.6%, and the position relative to the 52-week high is -16.6%. Relative strength versus the KOSPI is 29 (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 28% of all stocks. Over the past three months it outpaced the index by 1.8%. 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 +1.78% / 6M -21.68% / 12M -41.68%
Key metrics Computed vs sector median
Valuation
The P/E of 13.06x is in line with the sector median (12.80x). The P/B of 2.09x is above the sector median (1.61x). 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 19.9%, above the sector average (13.0%). The operating margin is 14.1%. The debt ratio is 183.7%, but for financial firms deposits and insurance liabilities count as debt, so it cannot be read on the same yardstick as an ordinary company.
Growth FY2025 · annual report (consolidated)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $15.0B | $17.9B | $21.0B | +17.21% ↓ slower |
| Operating profit | $198.3M | $1.0B | $2.7B | +172.26% ↓ slower |
| Net profit | $155.8M | $823.6M | $1.5B | +84.97% ↓ slower |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $10.9B | $12.2B | $15.0B | $17.9B | $21.0B |
| Operating profit | -$972.8M | -$249.8M | $198.3M | $1.0B | $2.7B |
| Net profit | -$652.9M | -$152.4M | $155.8M | $823.6M | $1.5B |
| Revenue CAGR | 4-yr avg 17.90% | ||||
Revenue rose 17.2% year over year (2023 ₩21.3 trillion → 2024 ₩25.5 trillion → 2025 ₩29.9 trillion), and the three-year trend is 'rising'. That said, the pace of growth slowed from the prior year. Operating profit rose 172.3% year over year. The pace of that profit growth is gradually easing. Over the 5 years on record, revenue compound annual growth (CAGR) is 17.9%. The two-year revenue CAGR is 18.6%. In the most recent quarter (Q1 2026), revenue was 20.2% higher than the same period a year earlier.
Latest quarterly results Source Q1 2026 · vs year-ago
Technical indicators Computed
What stands out
- The dividend yield, at 3.1%, is on the high side.
- ROE of 19.9% points to solid profitability.
- Revenue grew 17.2% year over year, a sign of growth.
Points to watch
- The price is high versus peers, so expectations already appear priced in.
Recent news & events searched · sourced
- 2026-06-01UpdateSingle sale-and-supply contract (ship order) signed (material event report)A new ship contract that fills the order backlog, expanding the revenue base for the coming years. In shipbuilding, orders are effectively future results, so contract accumulation improves medium-term earnings visibility. Source
- 2026-05-20DividendFiscal 2025 year-end dividend decided (₩12,300 per share)A dividend yield of about 3.7% and a 40.1% payout ratio link rising profit to shareholder returns. It is a downside-support factor that sets the company apart from the other large shipbuilders, which pay no dividend. Source
- 2026-05-14UpdateSingle sale-and-supply contract (ship order) signedAn individual order contract that supports the fact that, as of the first quarter, the shipbuilding affiliates' cumulative orders reached $6.4 billion, about 37% of the full-year target ($17.0 billion). Source
- 2026-05-07EarningsFirst-quarter 2026 consolidated results disclosed (revenue ₩8.14 trillion, operating profit ₩1.36 trillion, net profit ₩1.14 trillion)A 16.7% operating margin, well above full-year 2024 (13.0%), with net profit up 86.6% year on year. This shows structural improvement as high-priced order volumes are recognized. Source
Figure cross-check computed ↔ external
| Metric | Computed | External | Status | Source |
|---|---|---|---|---|
| Full-year 2025 revenue and operating profit | revenue 29₩933.3 billion / operating profit 3₩904.5 billion | revenue 29₩933.2 billion / operating profit 3₩904.5 billion | Confirmed | link |
| First-quarter 2026 consolidated net profit | 1₩141.4 billion | 1₩141.4 billion | Confirmed | link |
| HD Hyundai Heavy Industries ownership stake | approx. 69% | 72,639,443 · 69.27% | Confirmed | link |
| Estimated 2026 net profit (attributable to controlling shareholders) | approx. ₩3.8 trillion(self-estimate) | — | Unverified | link |
Recent filings Source
- 2026-06-01Large-business-group status disclosure (amended)
- 2026-06-01Corporate governance report
- 2026-06-01Single supply/sales contract
- 2026-05-29Large-business-group status disclosure
- 2026-05-21Single supply/sales contract
- 2026-05-20EarningsFair-disclosure notice
- 2026-05-20EarningsFair-disclosure notice
- 2026-05-15PeriodicQuarterly report
- 2026-05-14Single supply/sales contract
- 2026-05-13Single supply/sales contract
- 2026-05-08Single supply/sales contract
- 2026-05-07EarningsFair-disclosure 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.