PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩1,200 per share · Prices as of the 2026-10-02 close
Ilsung IS has kept net income positive, but operating losses have persisted for five consecutive quarters, leaving core profitability recovery as the key task.
2025 revenue was KRW 64.29bn with an operating loss of KRW 6.16bn, while owner net income stayed positive at KRW 1.17bn for a third straight year.
All five quarters from 2025Q2 to 2026Q2 posted operating losses, but non-operating income kept most quarters net-income positive.
With a low debt ratio (4.3% in 2025) and minimal borrowings, the company holds a large cash position and maintains solid financial stability.
Augmentin, produced under a GSK partnership, remains the core cash cow, while the company is pursuing CMO (contract manufacturing) expansion as a new growth driver.
Treasury stock holdings reach 48.75% of shares outstanding with no history of cancellation, keeping governance and shareholder-return debates alive.
Ilsung IS, founded in 1954 and formally launched as Ilsung Sinyak in 1961, listed on the KOSPI in 1985 and renamed Ilsung IS in 2023.
Its core business is the research, production, and sale of prescription drugs including antibiotics, anesthetics, contrast media, bone-metabolism drugs, and antiviral agents, and under a partnership with GlaxoSmithKline (GSK) it produces the penicillin-class antibiotic Augmentin, which it exports domestically and to markets including Japan.
Based on a past disclosed breakdown, antibiotics such as Augmentin accounted for roughly 24% of revenue, bone-disease treatments such as Wonalpha about 21%, and vascular contrast agents such as Reipam about 12%.
More recently the company has been broadening its product lineup into cardiovascular and diabetes drugs through generic development and in-licensing, and it has signed a series of contract-manufacturing and co-development agreements for products such as Sabtab, Levopyri tablets, and Rabecaduo, expanding its CMO (contract manufacturing organization) business across solid oral dosage forms, injectables, and antibiotics.
The Ansan plant underwent remodeling from November 2024 to February 2025 to expand its general solid-dosage line, and the plant's average annual utilization rate is reported to exceed 150%.
On governance, Chairman Yoon Seok-geun holds roughly 15.6% as the largest shareholder, with related parties bringing the combined stake to about 38.2%, while treasury shares of 48.75% further constrain the free float.
The company has also been running an open recruitment for future management-succession candidates in an apparent attempt to separate ownership from management.
Competitively, Augmentin has long held a leading position in Korea's amoxicillin-clavulanate antibiotic market as an original brand, but in a mature market contested by roughly 200 generic products, changes in sales-incentive strategy can materially affect prescription volume.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩16.3B | -₩2.3B | −14.1% |
| 2025Q3 | ₩16.8B | -₩800M | −5.0% |
| 2025Q4 | ₩14.7B | -₩2B | −13.7% |
| 2026Q1 | ₩16.7B | -₩500M | −3.0% |
| 2026Q2 | ₩17.1B | -₩1.6B | −9.1% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩61.2B | ₩1.3B | ₩105.2B | 2.1% | 23.6% | 11.0% |
| 2023 | ₩78.1B | -₩8B | -₩20.9B | −10.2% | −5.5% | 9.5% |
| 2024 | ₩69B | -₩9.5B | ₩13.1B | −13.8% | 3.4% | 3.0% |
| 2025 | ₩64.3B | -₩6.2B | ₩1.2B | −9.6% | 0.3% | 4.3% |
Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-24
Annual revenue rose from KRW 61.25bn in 2022 to KRW 78.05bn in 2023, then declined for two straight years to KRW 69.02bn in 2024 and KRW 64.29bn in 2025.
Operating profit swung from a modest gain of KRW 1.30bn (2.1% margin) in 2022 to losses of KRW 7.99bn in 2023 and KRW 9.52bn in 2024, before narrowing to a loss of KRW 6.16bn in 2025.
Net income has been highly volatile: the large owner net income of KRW 105.24bn in 2022 was driven by one-off, non-operating items including the resolution of a Samsung C&T-related lawsuit, reversing sharply to a net loss of KRW 20.94bn in 2023 before returning to profit at KRW 13.09bn in 2024 and KRW 1.17bn in 2025.
On a quarterly basis, after an operating loss of KRW 2.29bn and a net loss of KRW 4.12bn in 2025Q2, the company posted operating losses of KRW 0.85bn, KRW 2.01bn, KRW 0.50bn, and KRW 1.56bn in 2025Q3, 2025Q4, 2026Q1, and 2026Q2 respectively, yet net income remained positive in every one of those four quarters.
This pattern suggests that while the core pharmaceutical manufacturing and sales business remains under profitability pressure, financial income from the company's substantial cash holdings—interest and dividends—has offset much of the operating shortfall.
On the cash-flow side, operating cash flow turned positive at KRW 3.88bn in 2025, but was persistently negative from 2022 to 2024 (KRW -38.97bn, KRW -41.47bn, and KRW -4.26bn respectively), highlighting a gap between reported earnings and actual cash generation in those years. The debt ratio fell from 11.0% in 2022 to 4.3% in 2025, reflecting a very low level of financial leverage.
Korea's pharmaceutical industry is entering a phase in which tightened joint bioequivalence testing requirements and a tiered drug-pricing system are making generic drug development and launch more difficult than before.
This regulatory shift is increasing pressure on domestic drugmakers to move away from generic-centric business models toward an advanced-country structure built on greater R&D investment.
The amoxicillin-clavulanate antibiotic market where Ilsung IS is concentrated remains a mature segment contested by roughly 200 competing products, and has shown a pattern of fluctuating volumes tied to prescription declines during the COVID-19 period followed by subsequent recoveries.
Within this environment, Augmentin has long held a market-leading position, but intensifying competition from low-cost generics and changes in prescription-incentive strategy can directly affect its sales trajectory.
Meanwhile, CMO and contract-manufacturing business has emerged as a new growth avenue among small and mid-sized domestic pharmaceutical companies, and Ilsung IS is pursuing this trend through the Ansan plant expansion and an increasing number of new contract-manufacturing agreements.
Within the sector, large pharmaceutical and biosimilar makers are focusing on R&D and overseas expansion, while smaller companies such as Ilsung IS are differentiating by preserving their original-brand franchise and building a more stable revenue base through expanded contract manufacturing.
Following a management change in 2022, the company set a mid-to-long-term target of KRW 150 billion in revenue by 2027, with action items including new generic launches, expansion of in-licensed drugs, and growth in export and contract-manufacturing sales.
Within this roadmap, the CMO business reportedly has a specific goal of reaching KRW 5 billion in annual contract-manufacturing revenue within three years by expanding into solid oral dosage forms, injectables, and antibiotics.
More recently, the company has continued executing toward that goal by signing multiple contract-manufacturing and co-development agreements with domestic mid-tier pharmaceutical companies for products including Sabtab, Levopyri tablets, and Rabecaduo.
On the production-infrastructure side, the Ansan plant remodeling expanded its general solid-dosage line, and disclosures show an increase in the book value of related equipment investment.
On governance, the company is recruiting candidates for future management succession in an effort to separate ownership from management, and any subsequent personnel announcements could signal organizational change.
Whether these mid-term targets and execution plans can meaningfully reverse the recent revenue decline (from KRW 78.0 billion in 2023 to KRW 64.3 billion in 2025) remains something to be confirmed through upcoming quarterly results and the actual revenue contribution of CMO contracts.
Ilsung IS's net income has swung between modest profit and modest loss over recent quarters, an instability that tends to structurally inflate earnings-based valuation ratios.
At the same time, the stock trades at a level below the company's net asset value per share, suggesting that despite substantial cash holdings and a low debt ratio, the market has yet to gain full confidence in a recovery of core operating profitability.
Dividends have continued each year, but the payout appears modest relative to the scale of the recent profit recovery.
Looking at the multi-year earnings pattern, a large one-off-driven profit in 2022 was followed by a net loss in 2023 and a renewed recovery in profitability through 2024 and 2025; how this directional shift eventually feeds into valuation metrics depends on whether core operating profitability continues to improve.
The unusually high treasury-share ratio is another factor to weigh in valuation interpretation, given its implications for float size and potential future share issuance.
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 2026-08-24
The debt ratio fell to 4.3% in 2025 with minimal borrowings, giving the company strong financial stability. It reportedly holds around KRW 220 billion in cash and short-term financial products, and the financial income generated from these assets has offset a substantial portion of the operating loss.
This financial capacity could underpin further business expansion such as CMO investment or new in-licensing deals.
Alongside the Ansan plant remodeling, the company is expanding contract manufacturing across solid oral dosage forms, injectables, and antibiotics, and has signed multiple manufacturing agreements including Sabtab, Levopyri tablets, and Rabecaduo.
It has also set a specific target of reaching KRW 5 billion in annual contract-manufacturing revenue within three years. If executed successfully, this could diversify the revenue base away from dependence on antibiotics.
Through a long-standing partnership with GlaxoSmithKline, the company produces the penicillin-class antibiotic Augmentin, and in 2018 it was designated GSK's best supplier for the Asia-Pacific region.
This brand has maintained a long prescription base in the domestic market and also has export channels including to Japan. Its status as an original brand provides a degree of defensiveness amid competition from low-cost generics.
The company posted operating losses in all five quarters from 2025Q2 through 2026Q2, with the loss size fluctuating between KRW 0.50 billion and KRW 2.29 billion each quarter.
The quarters where net income turned positive did so on the back of non-operating financial income, and a structural improvement in the core pharmaceutical manufacturing and sales business has not yet been confirmed. Revenue also declined for two straight years, from KRW 78.0 billion in 2023 to KRW 64.3 billion in 2025.
The treasury-share ratio stands at 48.75%, among the highest for small and mid-cap listed companies in Korea, yet the company reportedly has never canceled any of these shares.
In 2019 it sold part of its treasury stock citing the goal of expanding the float, raising the possibility that further disposals could weigh on the share supply going forward.
Combined with the roughly 38.2% stake held by the owning family and related parties, the effective free float remains significantly constrained.
Tightened joint bioequivalence testing requirements and the tiered drug-pricing system are making the generic development environment more difficult than before.
The company's core amoxicillin-clavulanate antibiotic market is also a mature segment contested by roughly 200 competing products, where changes in prescription-incentive strategy can directly affect sales. These industry-level shifts could constrain the pace of any revenue recovery.
Declines in tablet and injectable sales in the core business have persisted, with operating losses continuing for five consecutive quarters. Changes in sales strategy (such as commission policy) for key products like Augmentin can affect prescription incentives and thus create revenue volatility.
If new CMO contracts fail to contribute revenue at the targeted scale, securing a new growth driver could be delayed.
Treasury shares reaching 48.75% combined with concentrated family ownership carry the potential for controversy over limited float and minority shareholder rights.
Given the past instance of reselling treasury stock rather than canceling it, any future disposal decision could create unexpected share-supply pressure on the market. Continued external calls for governance improvement could influence management decision-making going forward.
Tightened joint bioequivalence regulations and the tiered drug-pricing system could weigh on a generic-centered revenue structure. As pressure mounts across the domestic pharmaceutical industry to expand R&D investment, the pace of response could be a key issue for a company with a relatively small research workforce.
Antibiotic prescription demand can also fluctuate with external factors such as infectious disease trends, reducing the predictability of revenue.
The 2026 third-quarter report should be checked to see whether the operating loss narrows and how much revenue CMO contracts are contributing.
Any follow-up personnel announcements from the management-succession recruitment program could signal governance change.
Whether the National Assembly passes a Commercial Act amendment mandating treasury-share cancellation could affect the overhang issue tied to the 48.75% treasury-stock ratio.
If agenda items on dividend policy, treasury-stock utilization, or management succession are put forward, they would offer a gauge of the direction on shareholder returns and governance.
Ilsung IS combines an original-brand business centered on the GSK-partnered antibiotic Augmentin with a CMO expansion as a new growth axis, but a recovery in core profitability has not yet been confirmed, with operating losses continuing for five consecutive quarters from 2025Q2 through 2026Q2.
Net income stayed positive in most of those quarters thanks to financial income from the company's large cash holdings, a factor distinct from any improvement in operating competitiveness.
On the financial-structure side, a low debt ratio and thick cash reserves support stability, while a 48.75% treasury-share ratio and concentrated family ownership leave room for governance-related controversy.
Revenue declined for two consecutive years, from KRW 78.0 billion in 2023 to KRW 64.3 billion in 2025, leaving a still-wide gap to the company's stated target of KRW 150 billion by 2027.
How governance and policy events—including CMO expansion, the management-succession program, and the potential Commercial Act amendment—affect future performance and shareholder value warrants continued monitoring. The investment judgment based on these facts is left to each individual reader.
Report written 2026-09-05 · Data as of 2026-09-04
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