KOSPIChemicals002820

SUN&L

₩954▼ 1.34%2026-10-02 close

Market Cap

₩11.5B

Turnover

₩100M

Volume

120,000 shares

Shares out.

12.1M

PER

2.5×

PBR

0.1×

EPS

₩671

Dividend Yield

0.00%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close

Report overview

Pivoting to Beauty Packaging: Execution Is the Key Test

SUN&L is winding down more than six decades of timber manufacturing to pivot toward cosmetics and household packaging, while simultaneously pursuing the divestiture of a loss-making interior subsidiary and the sale of idle real estate to repair its balance sheet.

1
The life & beauty packaging segment turned profitable in the second quarter of 2026, emerging as a new source of earnings.
2
The company decided to pursue a full divestiture of its interior subsidiary, whose performance deteriorated sharply amid the construction downturn.
3
Consolidated operating profit remained in the red for four straight years from 2022 to 2025, and recent net profit swings to black have relied heavily on one-off asset disposal gains.
4
In its value-up plan, the company set targets of KRW 280 billion in consolidated revenue, a 75% life & beauty revenue mix, and a debt ratio in the 70% range by 2030.
5
Liquidating loss-making overseas units such as its New Zealand afforestation subsidiary and selling idle domestic real estate form the core of the balance-sheet repair strategy.

Business structure

SUN&L started out in 1959 as Sunchang Industry, a comprehensive timber company producing plywood, MDF, sawn lumber and particle board, but it has recently been restructuring away from timber toward beauty and household packaging.

The business is organized into three main areas: a living-space division handling wood distribution, an interior division (subsidiary SUN&L Interior) that supplies fire doors, built-in furniture and total interior fit-out, and a life & beauty division producing cosmetics and household containers.

In early 2024 the company halted timber manufacturing after more than sixty years, shifting to a distribution-only model. The life & beauty division rests on two pillars: Darin, a pump-dispenser maker acquired in 2015, and Illupack, a cosmetics container specialist acquired in 2024.

Illupack produces base and color cosmetics containers such as compacts and lip gloss tubes, with Aekyung Industrial among its key customers.

The division is expanding North American exports by promoting all-plastic pumps that contain no metal parts, positioning them to avoid U.S. tariff exposure, and Illupack's premium cosmetics brand POPKLE has also launched in the U.S. market.

The interior division, centered on B2B construction contracts with builders, saw its performance deteriorate sharply amid the construction downturn, and the company recently decided to pursue a full sale of its stake and management control in that unit.

In terms of competitive positioning, the life & beauty segment operates in a market with intense price and technology competition, where the expansion of low-cost suppliers such as those in China is seen as lowering entry barriers.

Earnings trend

Quarterly revenue · Operating profit

₩77.7B-₩2.9B25Q2₩66B-₩6.8B25Q3₩57.8B-₩6.1B25Q4₩50.6B-₩2.8B26Q1₩59.5B-₩1.1B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩506.7B-₩17.7B2022₩441.1B-₩30.2B2023₩339.3B-₩5.9B2024₩272.4B-₩17.9B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩77.7B	-₩2.9B	−3.8%
2025Q3	₩66B	-₩6.8B	−10.4%
2025Q4	₩57.8B	-₩6.1B	−10.5%
2026Q1	₩50.6B	-₩2.8B	−5.5%
2026Q2	₩59.5B	-₩1.1B	−1.8%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩506.7B	-₩17.7B	-₩18.3B	−3.5%	−11.7%	248.6%
2023	₩441.1B	-₩30.2B	-₩160.9B	−6.8%	−68.1%	171.4%
2024	₩339.3B	-₩5.9B	-₩15.7B	−1.7%	−7.1%	123.4%
2025	₩272.4B	-₩17.9B	-₩2.3B	−6.6%	−1.1%	112.2%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-23

Earnings analysis

Consolidated revenue fell for four straight years, from KRW 506.7 billion in 2022 to KRW 441.1 billion in 2023, KRW 339.3 billion in 2024, and KRW 272.4 billion in 2025, a decline attributable to the halt in timber production combined with a shrinking order book in the interior business.

Operating profit stayed negative throughout, posting losses of KRW -17.7 billion in 2022, KRW -30.2 billion in 2023, KRW -5.9 billion in 2024 and KRW -17.9 billion in 2025.

In particular, 2023 recorded a large net loss attributable to owners of KRW -160.9 billion, far exceeding that year's operating loss of KRW -30.2 billion, suggesting a substantial one-off, non-operating loss was booked that year.

In 2024, despite lower revenue the operating loss narrowed to KRW -5.9 billion, yet the net loss attributable to owners widened to KRW -15.7 billion. In 2025 the operating loss widened again to KRW -17.9 billion, while the net loss attributable to owners narrowed sharply to KRW -2.3 billion.

On a quarterly basis, net profit attributable to owners briefly turned positive in the third quarter of 2025 (KRW +7.2 billion) and the second quarter of 2026 (KRW +8.2 billion), even though operating profit remained negative in both quarters at KRW -6.8 billion and KRW -1.1 billion respectively, indicating that non-operating items such as asset sales drove the net profit improvement.

Indeed, the second-quarter 2026 net profit reflected a disposal gain from the sale of forest land in Pohang.

In contrast, the fourth quarter of 2025 (KRW -2.4 billion) and the first quarter of 2026 (KRW -4.9 billion) posted losses at both the operating and net levels, underscoring significant quarter-to-quarter volatility.

The cumulative net profit attributable to owners over the most recent four quarters (Q3 2025 through Q2 2026) totaled roughly KRW 8.1 billion, a figure that should also be read with the caveat that one-off gains in two of those four quarters played an outsized role.

Industry analysis

The domestic timber industry is seeing demand contract alongside a decline in new apartment construction activity, and in the first quarter of 2026 consolidated revenue fell 28.7% year-on-year while both operating and net losses widened.

The interior division was likewise hit directly by the downturn in new apartment construction, with both revenue and profitability retreating.

By contrast, the beauty and household packaging market is seen as gaining overseas opportunities on the back of the global spread of K-beauty and a premiumization trend in consumer goods.

That said, this market is characterized by price-sensitive cosmetics and household-goods clients and an ongoing expansion of low-cost suppliers, notably from China, making cost competitiveness a basic prerequisite.

Technically, manufacturing difficulty is high because leak prevention and precise dosing calibrated to formulation and viscosity vary by product, and export-bound products in particular face stricter certification requirements.

Given this structure, market observers note it will not be easy for the household packaging business to replace the scale of the former timber business, which generated roughly KRW 200 billion or more annually, in a short period.

The company once ranked among the top three players by market share in Korea's plywood market, but having halted production it now operates mainly as a distributor, marking a significant shift in its industry standing.

Outlook

In a value-up plan announced on June 29, 2026, the company set a target of raising the life & beauty division's revenue share from an estimated 48% in 2026 to 75%, while targeting KRW 280 billion in consolidated revenue by 2030.

To reach this goal, it also outlined plans to expand new product lines such as essence pumps and triggers to sustain roughly 20% annual growth in the life & beauty business and lift its operating margin above 8%.

The interior division's initial priority scenario was a turnaround via a shift to B2C total-interior and fire-door products, targeting breakeven by 2028 and a return to profit by 2030.

However, amid assessments that the pace of earnings deterioration outran the plan, the company's board recently decided to pursue the outright sale of the entire stake (2.6 million shares) and management control of SUN&L Interior.

On the balance-sheet side, the company set a goal of lowering its debt ratio through the phased sale of roughly KRW 260 billion worth of idle real estate in Incheon and Cheonan, and said it had already signed sale contracts covering about 22% of that target, worth KRW 57.4 billion.

Overseas, the company is also cleaning up loss-making units, including a decision to liquidate its New Zealand afforestation and logging subsidiary. The company stated it plans to resume shareholder-return policies, including an expanded dividend payout ratio, in step with earnings improvement.

Valuation

PER

2.5×

PBR

0.1×

ROE

3.7%

EPS

₩671

BPS

₩18,638

Dividend per share

₩0

The self-calculated price-to-book ratio the company discloses shows the share price sitting well below its net asset value.

However, because the return to net profit in recent quarters has been driven largely by one-off disposal gains from asset sales, this figure should not be equated directly with a recovery in core operating performance.

The company itself has set a target in its value-up plan to lift its currently depressed price-to-book ratio over the medium to long term, which suggests a meaningful gap between the value the market currently assigns and the level management is aiming for.

On dividends, the company maintained a relatively high payout policy in the past but has not distributed dividends in recent years, while stating it intends to expand its payout ratio again once earnings improvement becomes evident.

Ultimately, the level at which the stock currently trades carries several variables that could shift depending on how the ongoing restructuring—divestiture of the interior unit, the sustainability of life & beauty profits, and balance-sheet repair—actually plays out.

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 2026-08-23

Bull factors

Signs of Profitability in Life & Beauty

The life & beauty division posted cumulative first-half 2026 revenue of KRW 30 billion and operating profit of KRW 1.6 billion, establishing itself as the company's primary earnings driver. Subsidiary Illupack also swung from a first-quarter operating loss to a second-quarter operating profit.

The division is also expanding overseas channels, including the U.S. launch of premium brand POPKLE and the extension of a long-term supply agreement with a major customer.

Balance-Sheet Repair via Asset Sales

The company is progressing on a plan to sell roughly KRW 260 billion of idle real estate in Incheon and Cheonan to lower its debt ratio, having already signed contracts covering about 22% of that target.

It is also cleaning up loss-making overseas units, including the liquidation of its New Zealand afforestation subsidiary. The effect of this asset monetization is already visible, as the second-quarter 2026 swing to net profit included a disposal gain from the sale of forest land in Pohang.

Portfolio Simplification and Business Focus

The company decided to pursue a full sale of its stake and management control in its interior subsidiary, whose losses widened amid the construction downturn. This could create conditions to concentrate resources on the comparatively higher-growth beauty packaging business.

The value-up plan also clearly articulates a direction to expand the life & beauty revenue share to 75% by 2030.

Bear factors

Chronic Consolidated Operating Losses

Consolidated operating profit posted losses for four consecutive years from 2022 through 2025. The interior division's slump accelerated further in the first half of 2026, with revenue down 40.6% year-on-year and the operating loss expanding to roughly seven times the prior-year level.

Even as the life & beauty division turned profitable, the interior unit's large losses continue to drag down consolidated results.

Capital Erosion Risk at Illupack

Since its 2024 acquisition, Illupack has accumulated losses of about KRW 2.9 billion, exceeding the KRW 2 billion acquisition price. As of the end of the third quarter of 2025, its total assets were about KRW 12.9 billion against total liabilities of about KRW 12.1 billion, leaving little capital buffer.

Continued losses have raised the possibility of full capital impairment, making the durability of its second-quarter swing to profit a key question.

Execution Risk in the Restructuring Plan

The interior division's original priority scenario was a B2C-driven turnaround, but the company shifted to a sale strategy within about two months, reflecting how quickly performance deteriorated relative to plan.

The value-up plan's targets—KRW 280 billion in 2030 revenue and a 75% life & beauty mix—represent a substantial gap from the current scale of operations. If asset sales and the subsidiary divestiture are not completed at the planned timing and price, the balance-sheet repair timeline could be delayed.

Risk factors

Business Restructuring and Divestiture Execution Risk

The sale of SUN&L Interior is still at the board-resolution stage, with the buyer and final sale price not yet finalized. The idle real estate sale program is also at an early stage, with contracts signed covering only about 22% of the target. Delays or unfavorable pricing terms could disrupt the timeline of the broader balance-sheet repair plan.

Subsidiary Financial Soundness Risk

A number of subsidiaries, including Illupack, are posting losses that weigh on consolidated results. Illupack has limited capital buffer, and continued losses have raised the possibility of capital impairment. The company's overall debt ratio also remains above 100%, warranting continued management attention.

End-Market and Competitive Risk

The interior and timber businesses are directly exposed to the construction downturn, making the timing of any recovery difficult to gauge.

The life & beauty division also faces intensifying price competition from cost pressure by cosmetics and household-goods clients and the expansion of low-cost suppliers, including from China. Both segments have earnings that are highly sensitive to shifts in external supply-demand conditions.

What to watch next

Around November 2026
Third-quarter and preliminary earnings disclosures should be checked to see whether the life & beauty division and Illupack sustain their swing to profit into the third quarter, and whether losses at the interior division narrow.
Fourth quarter of 2026
Watch for further disclosures on the SUN&L Interior sale process, including buyer selection, sale price, and expected closing timing.
By the end of 2026
Check whether the liquidation of loss-making overseas units, including the New Zealand afforestation subsidiary, is completed and how any related gains or losses are reflected in earnings.
Fourth quarter 2026 through first half of 2027
Monitor progress on additional sale contracts for the idle Incheon and Cheonan real estate and the actual timing of cash inflows, which will indicate the pace of debt-ratio improvement.
Early 2027
At the time of the 2026 full-year results announcement, check whether dividend payments resume and whether the stated policy of expanding the payout ratio is put into concrete form.

Overall view

SUN&L is actively pivoting from timber manufacturing toward cosmetics and household packaging, with some evidence of progress seen in the second-quarter 2026 swing to profit at the life & beauty division and Illupack.

However, on a consolidated basis the company posted operating losses for four straight years from 2022 through 2025, and the recent return to net profit relied heavily on one-off disposal gains such as the sale of forest land in Pohang, a distinction that should be kept separate from any recovery in core operations.

The interior division, whose losses widened amid the construction downturn, is now the subject of a full stake and management-control sale, and whether that deal closes—and on what terms—will be a key variable shaping consolidated results going forward.

The company's value-up plan lays out concrete targets through 2030, including a 75% life & beauty revenue mix, KRW 280 billion in revenue, and a debt ratio in the 70% range, but the gap versus current performance is substantial, making execution the central question.

Continued losses and limited capital buffers at Illupack and other subsidiaries also warrant ongoing scrutiny from a financial-soundness perspective.

Taken together, the direction of the business overhaul is clear, but the interior division sale, asset monetization, and the durability of life & beauty profits are three execution threads that will determine the company's earnings trajectory ahead.

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.