KOSPIChemicals001390

KG Chemical

₩4,250▲ 0.24%2026-10-02 close

Market Cap

₩280.2B

Turnover

₩200M

Volume

60,000 shares

Shares out.

66.4M

PER

3.3×

PBR

0.3×

EPS

₩1,381

Dividend Yield

3.32%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩150 per share · Prices as of the 2026-10-02 close

Report overview

Subsidiary Recovery Drives Profit Rebound

KG Chemical is a holding company whose consolidated results are shaped less by its core chemical business than by subsidiaries such as KG Mobility and KG Steel, and profit has been recovering through the first two quarters of 2026 after a weak fourth quarter of 2025.

1
Consolidated revenue has expanded past the 9-trillion-won mark, but the operating margin has steadily declined from 7.6% in 2022 to 3.4% in 2025.
2
Over the trailing four quarters (Q3 2025 through Q2 2026), cumulative operating profit was about KRW 275.8 billion and cumulative net profit attributable to owners was about KRW 92.6 billion.
3
In Q2 2026, operating profit reached KRW 90.9 billion and net profit attributable to owners reached KRW 36.1 billion, the highest levels among recent quarters.
4
Subsidiary KG Mobility posted its fourth consecutive year of profitability in the first half of 2026, with export share expanding to 61.6%.
5
Steel subsidiary KG Steel is pursuing an acquisition of a stake in used-car platform K Car as part of ongoing business diversification.

Business structure

KG Chemical was founded in 1954 as Korea's first private fertilizer company and listed on the KOSPI in 1989, serving as the founding entity of the KG Group.

The company operates through 34 subsidiaries, including KG Mobility, spanning eleven business segments such as chemicals, steel, electronic payments, automobile manufacturing and sales, and coffee franchising.

The chemical segment produces eco-friendly fertilizers such as compound and phosphate fertilizers, along with concrete admixtures, flocculants, and vehicle urea solution (AdBlue), with the admixture raw material business standing out as a growth axis built on overseas market share.

The automobile segment, KG Mobility, runs SUV and pickup lineups including Tivoli, Torres, Rexton, and Musso for both domestic and export markets while expanding its hybrid and electric vehicle mix.

The steel segment, KG Steel, focuses on cold-rolled and surface-treated steel such as galvanized and color-coated products, with exports running at roughly double domestic volumes.

The electronic payments segment, through KG Inicis and KG Mobilians, operates payment gateway services and is exploring digital financial infrastructure businesses.

More recently, KG Steel has moved to acquire a stake in used-car platform K Car, a step seen as strengthening links between manufacturing, distribution, and platform businesses alongside KG Mobility.

As a result, KG Chemical's consolidated results are shaped more by the business conditions of subsidiaries in autos, steel, and electronic payments than by its core chemical operations.

Earnings trend

Quarterly revenue · Operating profit

₩2.2T₩78.9B25Q2₩2.5T₩90.2B25Q3₩2.3T₩30B25Q4₩2.4T₩64.6B26Q1₩2.6T₩90.9B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩6.6T₩501.1B2022₩8.9T₩442.6B2023₩8.9T₩318.8B2024₩9.1T₩305.7B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩2.2T	₩78.9B	3.6%
2025Q3	₩2.5T	₩90.2B	3.7%
2025Q4	₩2.3T	₩30B	1.3%
2026Q1	₩2.4T	₩64.6B	2.7%
2026Q2	₩2.6T	₩90.9B	3.5%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩6.6T	₩501.1B	₩303.5B	7.6%	38.3%	115.4%
2023	₩8.9T	₩442.6B	₩95.8B	5.0%	10.4%	115.0%
2024	₩8.9T	₩318.8B	₩61.9B	3.6%	6.5%	116.2%
2025	₩9.1T	₩305.7B	₩69.7B	3.4%	7.0%	111.9%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-21

Earnings analysis

KG Chemical's consolidated revenue expanded from KRW 6.6074 trillion in 2022 to KRW 8.9331 trillion in 2023, KRW 8.8631 trillion in 2024, and KRW 9.1016 trillion in 2025.

Operating profit, however, declined every year, from KRW 501.1 billion in 2022 to KRW 442.6 billion in 2023, KRW 318.8 billion in 2024, and KRW 305.7 billion in 2025, with the operating margin steadily falling from 7.6% to 5.0%, 3.6%, and finally 3.4%.

Net profit attributable to owners plunged from KRW 303.5 billion in 2022 to KRW 95.8 billion in 2023 and KRW 61.9 billion in 2024, before edging up to KRW 69.7 billion in 2025; the 2022 figure was heavily influenced by one-off factors, making direct year-over-year comparison difficult.

On a quarterly basis, operating profit dropped sharply from KRW 90.2 billion in Q3 2025 to KRW 30.0 billion in Q4 2025, then recovered for two consecutive quarters to KRW 64.6 billion in Q1 2026 and KRW 90.9 billion in Q2 2026.

Net profit attributable to owners followed a similar path, falling to KRW 12.0 billion in Q4 2025 before rebounding to KRW 26.9 billion in Q1 2026 and KRW 36.1 billion in Q2 2026, bringing the trailing four-quarter total (Q3 2025 through Q2 2026) to roughly KRW 92.6 billion.

This quarterly pattern illustrates how seasonality and business swings at subsidiaries in autos and steel feed directly into the holding company's consolidated results.

The debt ratio edged up slightly from 115.4% in 2022 to 116.2% in 2024 before easing to 111.9% in 2025, leaving the balance sheet structure broadly stable.

Operating cash flow improved every year, from KRW 282.8 billion in 2023 to KRW 377.5 billion in 2024 and KRW 383.8 billion in 2025, notably holding up even as reported profit declined.

Industry analysis

In the steel industry, domestic demand for panels and structural steel continues to soften amid a construction downturn, even as the World Steel Association forecasts global steel demand will reach 1.7725 billion tons in 2026, up 1.3% year over year.

In Korea, an anti-dumping investigation into Chinese galvanized and color-coated steel is underway, and the eventual ruling could reshape import cost structures.

Steelmakers tied to construction materials are seeing core profitability squeezed by weaker domestic demand and are responding by expanding exports and diversifying into new businesses.

In the automotive sector, carmakers are advancing an electrification shift toward hybrids and electric vehicles, and for KG Mobility, exports to new markets in Western Europe and the Middle East and Africa have become a key growth pillar.

A broader industry trend toward overseas expansion via completely-knocked-down (CKD) production is also evident.

The fertilizer and agricultural materials segment operates in a mature domestic market with a stable demand base but limited growth potential, while the concrete admixture raw materials business serves as a relatively faster-growing pillar built on overseas market share.

The electronic payment gateway (PG) industry is seen as a segment with steady growth supported by expanding online transactions and demand for digital financial infrastructure.

Outlook

KG Mobility has set a 2026 business plan targeting global sales of 137,300 units (up 24% year over year), revenue above KRW 5 trillion, and an operating margin above 2.2%, with export volume alone targeted at 100,000 units, or 72.8% of the annual sales goal.

In the first half of 2026, the company posted standalone revenue of KRW 2.3188 trillion and operating profit of KRW 30.5 billion, marking a fourth consecutive year of profitability, with export share expanding to 61.6%, the highest since the first half of 2014.

Overseas CKD production sites are scheduled to come online through the second half, a factor that will help determine whether the full-year sales and export targets are met.

KG Steel's 2026 turnaround strategy centers on expanding exports, responding to anti-dumping measures against Chinese galvanized and color-coated steel, adopting AI-based smart manufacturing, and investing roughly KRW 34.5 billion in a PLTCM line to add 50,000 to 300,000 tons of annual capacity.

KG Steel is also pursuing a 72.19% stake acquisition in used-car platform K Car, with the deal size reportedly adjusted from an initial KRW 550 billion to roughly the KRW 400 billion range, a move interpreted as reducing steel-business volatility while strengthening ties between manufacturing, distribution, and platform operations alongside KG Mobility.

How these subsidiary-level plans and investment decisions are executed will largely determine the trajectory of KG Chemical's consolidated results.

Valuation

PER

3.3×

PBR

0.3×

ROE

9.1%

EPS

₩1,381

BPS

₩15,711

Dividend per share

₩150

KG Chemical's shares tend to trade at a discount to net asset value, a pattern that can be partly attributed to the conglomerate discount typical of a holding company spanning multiple industries.

The earnings multiple based on the trailing four quarters sits below the upper end of the chemical sector's historical trading range, though this should be considered alongside the recent recovery in profit trends.

On the dividend side, the company has a track record of paying a per-share cash dividend, but the yield level tends to run below the sector average.

Following the large 2022 profit figure, earnings contracted in 2023 and 2024 before recovering again in 2025 and the first half of 2026, and valuation metrics have moved in step with this profit recovery phase.

Taking into account the holding-company discount, dependence on subsidiary business conditions, and the relationship between market value and net asset value, investors may find it useful to monitor the individual progress of subsidiaries such as KG Mobility and KG Steel.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-08-21

Bull factors

Subsidiary Earnings Recovery

KG Mobility posted a fourth consecutive year of profitability in the first half of 2026, with export share expanding to 61.6% for its highest export performance in twelve years.

KG Steel also turned its consolidated operating profit positive quarter-over-quarter in Q1 2026, signaling a path toward normalized operations. The simultaneous recovery signals from these two core subsidiaries, which account for the bulk of consolidated results, stand out as a positive factor.

Resilient Cash Generation

Operating cash flow improved every year, from KRW 282.8 billion in 2023 to KRW 383.8 billion in 2025, holding up even as operating profit declined. The debt ratio has also been managed stably within a 111% to 116% range.

This supports financial stability despite the profit volatility inherent in a diversified holding company structure.

Risk Diversification Through Business Mix

A business portfolio spanning chemicals, steel, automobiles, and electronic payments can act as a buffer, preventing a downturn in any single industry from dictating overall consolidated results.

KG Steel's recent move to acquire a stake in used-car platform K Car, aiming to link manufacturing, distribution, and platform businesses, can be seen as an extension of this diversification. Having businesses with different cycle timing mixed together can be viewed as a structural strength.

Bear factors

Long-Term Margin Decline

The consolidated operating margin declined every year, from 7.6% in 2022 to 3.4% in 2025. While revenue scale expanded, profit-generating efficiency actually weakened. Whether and when this margin decline bottoms out and reverses depends heavily on conditions at each subsidiary.

Structural Weakness in Core Steel Business

KG Steel's standalone 2025 revenue of KRW 2.9264 trillion and operating profit of KRW 133.5 billion both declined year over year, as construction-driven demand weakness for domestic panels and steel pressures core profitability.

Both volume and per-ton margin have been weakening simultaneously, making the timing of a turnaround difficult to predict. The practical impact of trade issues such as the anti-dumping ruling has also not yet been confirmed.

Complexity of the Holding Company Structure

With heterogeneous businesses in chemicals, steel, automobiles, electronic payments, and food service all housed under one company, the performance of individual segments is not always clearly reflected in consolidated results.

Large investment decisions such as the K Car acquisition could add further complexity to the business structure. Investors face the added burden of tracking each subsidiary's performance separately.

Risk factors

Industry and Demand Risk

If the construction downturn persists, recovery in steel and construction materials demand could be delayed. The automobile segment is also sensitive to intensifying domestic competition and shifts in global demand. If multiple industries weaken simultaneously, the negative impact on consolidated results could be amplified.

Trade and Regulatory Risk

The outcome of the anti-dumping investigation into Chinese galvanized and color-coated steel could reshape import cost structures and domestic price competition. The automobile segment is also exposed to shifts in trade policy, tariffs, and emissions regulations across markets. The unpredictable direction and timing of regulatory changes remains a source of uncertainty.

Large Investment and M&A Burden

Large investment decisions such as KG Steel's K Car stake acquisition are in progress, and the financial burden could vary depending on the final deal size and funding method. Investments to launch overseas CKD production sites could also become a cost burden if they do not proceed as planned. Execution risk at the subsidiary level could affect the consolidated financial structure.

What to watch next

November 2026
The Q3 consolidated earnings release will show whether KG Mobility's export momentum and KG Steel's margin recovery continued.
Q4 2026
It will be worth confirming whether KG Steel's K Car stake acquisition closes and what the final deal terms are.
Q4 2026 to early 2027
It will be worth watching whether early-stage output from overseas CKD production sites (Vietnam, Saudi Arabia, etc.) begins to show up in KG Mobility's results.
Late 2026 to early 2027
If a final ruling on the anti-dumping case involving Chinese galvanized and color-coated steel is issued, its impact on KG Steel's domestic price competition environment should be checked.

Overall view

KG Chemical is a holding company whose results are driven more by conditions at consolidated subsidiaries such as KG Mobility and KG Steel than by its core chemical business; consolidated revenue has grown each year, but the operating margin has steadily declined from 7.6% in 2022 to 3.4% in 2025.

Quarterly results dipped in Q4 2025 before recovering for two consecutive quarters in early 2026, with the trailing four-quarter net profit attributable to owners totaling roughly KRW 92.6 billion.

Core subsidiary KG Mobility achieved a fourth consecutive profitable year and expanded export share in the first half of 2026, while KG Steel turned operating profit positive in Q1 and is pursuing diversification through the K Car acquisition.

That said, the core steel business remains pressured by weaker domestic demand tied to the construction downturn, and trade issues such as the anti-dumping case along with execution risk from large investments remain in play.

The financial structure has stayed stable, with the debt ratio managed within a 111% to 116% range and operating cash flow improving every year.

Overall, KG Chemical's future earnings trajectory appears more dependent on the pace of recovery across its various subsidiaries and the execution of large investment decisions than on any single business line.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.