KOSPIHolding Companies004800

Hyosung

₩158,200▲ 1.67%2026-10-02 close

Market Cap

₩2.7T

Turnover

₩1.8B

Volume

10,000 shares

Shares out.

16.7M

PER

5.8×

PBR

1.0×

EPS

₩27,590

Dividend Yield

3.14%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩5,000 per share · Prices as of the 2026-10-02 close

Report overview

Subsidiary Earnings Recovery Meets the Holding-Company Discount

Hyosung's consolidated operating margin has risen sharply as its power-equipment, spandex and banking-automation affiliates improved together, yet most of its net asset value sits in a single holding, Hyosung Heavy Industries, leaving the classic holding-company discount and volatility intact.

1
In 2025 consolidated revenue was KRW 2,431.7bn and operating profit KRW 393.0bn, a 16.2% operating margin, up for a fourth straight year from 1.7% in 2022, 2.7% in 2023 and 9.7% in 2024.
2
Second-quarter 2026 revenue reached KRW 733.6bn with operating profit of KRW 231.6bn, far more than double the KRW 99.1bn posted a year earlier, marking a step-up in quarterly earnings power.
3
Key affiliate Hyosung Heavy Industries posted record quarterly operating profit of KRW 264.3bn on revenue of KRW 1,687.0bn in 2Q26, with new orders of KRW 3,324.2bn (up 51% year on year) and a backlog of KRW 17,507.0bn.
4
A March 2026 corporate value-up disclosure set a payout target of at least 25% of net profit attributable to owners, and total dividends rose from KRW 50.2bn for 2024 to KRW 83.6bn for 2025.
5
Total liabilities grew from KRW 1,836.4bn in 2024 to KRW 2,529.9bn in 2025 and the debt-to-equity ratio rose from 73.3% to 88.5%, so improving affiliate earnings and rising leverage have moved in parallel.

Business structure

Founded in 1966 and converted into a holding company in 2019, Hyosung sits at the top of the Hyosung Group structure, with its own business consisting of managing subsidiary stakes, investment and brand royalties.

Listed affiliates include Hyosung Heavy Industries in power equipment and construction, Hyosung TNC in spandex, nylon and trading, Hyosung Chemical and Hyosung ITX, whose results flow through mainly via the equity method.

Consolidated subsidiaries include Hyosung TNS, which makes and services banking automation machines (ATMs), pump maker Hyosung Good Springs, imported-car dealer FMK for Ferrari and Maserati, and Hyosung Investment & Development, and these form the substance of consolidated revenue.

In 2025 the company acquired the Onsan tank terminal business from Hyosung Chemical to secure steadier cash flow and reduce reliance on pure holding-company income.

Based on Korea Ratings data, Hyosung TNS recorded 2025 consolidated revenue of KRW 1,464.8bn and operating profit of KRW 149.7bn, with its operating margin rising from 4.3% in 2024 to 10.2% in 2025 (Asia Today, July 21, 2026).

The shift was attributed to moving the product mix from simple cash dispensers toward recyclers and teller cash recyclers (TCR) as domestic banks automate branch counter work.

Hyosung Good Springs unveiled its first ultra-high-efficiency IE5 booster pump for water supply at a May 2026 building-equipment exhibition, widening its high-efficiency line-up aimed at data centers and buildings.

The holding company's value is heavily concentrated in one affiliate: on Daishin Securities' own sum-of-the-parts estimate, the stake in Hyosung Heavy Industries accounted for 82.7% of total net asset value, more than Hyosung TNC, Hyosung TNS and Hyosung Chemical combined (May 2026).

The same report cited holdings of 57.23% by Chairman Cho Hyun-joon and 13 related parties, 6.66% by the National Pension Service and 20.76% by foreign investors.

Earnings trend

Quarterly revenue · Operating profit

₩601.9B₩99.1B25Q2₩612.2B₩121.9B25Q3₩663.7B₩90.2B25Q4₩530.2B₩94.6B26Q1₩733.6B₩231.6B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩3.7T₩64.9B2022₩3.4T₩94.4B2023₩2.3T₩221.1B2024₩2.4T₩393B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩601.9B	₩99.1B	16.5%
2025Q3	₩612.2B	₩121.9B	19.9%
2025Q4	₩663.7B	₩90.2B	13.6%
2026Q1	₩530.2B	₩94.6B	17.8%
2026Q2	₩733.6B	₩231.6B	31.6%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩3.7T	₩64.9B	₩15.6B	1.7%	0.6%	81.8%
2023	₩3.4T	₩94.4B	₩68,232,761	2.7%	0.0%	83.3%
2024	₩2.3T	₩221.1B	₩453.2B	9.7%	21.0%	73.3%
2025	₩2.4T	₩393B	₩329.9B	16.2%	13.5%	88.5%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-04

Earnings analysis

For 2025, consolidated revenue was KRW 2,431.7bn, operating profit KRW 393.0bn and net profit attributable to owners KRW 329.9bn, for a 16.2% operating margin.

The margin path runs from 1.7% in 2022 (revenue KRW 3,719.3bn, operating profit KRW 64.9bn) to 2.7% in 2023 (KRW 3,436.7bn, KRW 94.4bn) and 9.7% in 2024 (KRW 2,272.8bn, KRW 221.1bn), so profitability improved for four straight years even as reported revenue shrank.

Because a holding company's consolidated revenue depends heavily on which subsidiaries are consolidated and on business transfers, the absolute revenue line is a poor gauge of group scale.

Net profit attributable to owners was only KRW 0.07bn in 2023 before turning to KRW 453.2bn in 2024 and KRW 329.9bn in 2025, and in 2024 net profit far exceeded operating profit, showing the weight of non-operating items such as equity-method gains.

Quarterly, revenue and operating profit moved from KRW 601.9bn and KRW 99.1bn in 2Q25 to KRW 612.2bn and KRW 121.9bn in 3Q25, KRW 663.7bn and KRW 90.2bn in 4Q25, KRW 530.2bn and KRW 94.6bn in 1Q26, and KRW 733.6bn and KRW 231.6bn in 2Q26.

First-quarter 2026 revenue fell 4.3% year on year while operating profit rose 15.6%, according to the company's disclosure. The second-quarter 2026 operating margin exceeded 30%, the highest quarterly level in the reported window, and net profit attributable to owners widened to KRW 195.3bn.

Simultaneous improvement at affiliates is cited as the driver: equity-method income of KRW 147.0bn in 2Q26 was up 169% year on year and 214% quarter on quarter, with Hyosung TNC contributing most and other core affiliates including Hyosung Chemical also improving (BNK Investment & Securities, August 2026).

Operating cash flow, however, was KRW 421.1bn in 2025 versus KRW 464.8bn in 2024, while total liabilities rose from KRW 1,836.4bn to KRW 2,529.9bn and the debt-to-equity ratio climbed from 73.3% to 88.5%.

Industry analysis

Hyosung's earnings direction is effectively set by three overlapping industry cycles. The first is power equipment.

As of 2Q26 the heavy industries order backlog stood at about KRW 17,500bn with North America at 57%, while large-load tariffs for AI data centers have been approved in 24 US states and the Federal Energy Regulatory Commission is pursuing revisions to large-load interconnection rules.

Analysts argue that once tariffs and interconnection rules are settled, data center operators racing to secure grid capacity are more likely to pull forward contracts for ultra-high-voltage equipment. The second is spandex.

No new spandex capacity is expected in 2026 and about 125,000 tonnes is slated for 2027, yet demand growth should lift utilization from 77.5% in 2026 to 78.6% in 2027, and with downstream fabric makers' inventories at historic lows the second-half low season is expected to bite less than usual (NH Investment & Securities, August 2026).

Around the same time, commodity chemicals and higher-value downstream products diverged, with ethylene margins below break-even while spandex held firm supply-demand conditions (citing Shinhan Securities, August 2026).

The third is banking automation, where the domestic ATM market is shrinking as non-face-to-face channels expand, while emerging-market demand and multifunction financial kiosks support profitability.

The company therefore carries both the upside of the power infrastructure boom and the downside of commodity chemicals and a shrinking domestic ATM base, with competitive position differing affiliate by affiliate.

For the holding company itself, the discount to net asset value and its record of supporting affiliates are the variables most often raised in comparisons with peer holding companies.

Outlook

On verified facts, the biggest swing factor ahead is the pace of Hyosung Heavy Industries' US business.

In an August 4, 2026 report, Daishin Securities said it estimated 2026 revenue of KRW 7,333.0bn and operating profit of KRW 1,182.0bn for Hyosung Heavy Industries, and raised its 2026 heavy-industries order forecast from KRW 8,450.0bn to KRW 12,000.0bn and its revenue growth forecast from 15% to 25%.

The upgrade was attributed to expanding orders and sales of shorter-lead-time, higher-margin ultra-high-voltage gas circuit breakers (GCB) and gas-insulated switchgear (GIS) alongside transformers.

The same report projected that ultra-high-voltage transformer exports to the US from the Changwon plant, delayed by anti-dumping issues, would begin in earnest in the second half.

Management said that once the ultra-high-voltage breaker production venture established with a leading US power and energy infrastructure EPC firm reaches full operation, the local supply-chain benefit should show up in results.

On the textile side, Shinhan Securities in August 2026 forecast second-half operating profit of KRW 293.4bn for Hyosung TNC versus KRW 226.6bn in the first half, a view that coexists with more cautious forecasts reflecting low-season price declines.

On shareholder returns, reports indicate Hyosung is preparing its first group-level medium-term dividend guideline, after a March 2026 value-up plan targeting a payout ratio of at least 25% of net profit attributable to owners (IB Tomato, August 2026).

The company was quoted as saying it has no plan for further funding support to Hyosung Chemical and expects the value-up disclosure to ease part of the holding-company discount.

The watch list therefore narrows to three threads: durability of affiliate earnings, how far dividend policy is formalized, and the US regulatory and trade environment.

Valuation

PER

5.8×

PBR

1.0×

ROE

18.8%

EPS

₩27,590

BPS

₩160,956

Dividend per share

₩5,000

Valuation debate around Hyosung usually centers on the discount to net asset value rather than a standalone earnings multiple. In May 2026 Daishin Securities narrowed its NAV discount from 72% to 68% on easing risk at Hyosung Chemical and put the Hyosung Heavy Industries stake at 82.7% of total NAV.

That analysis also broke out the previously unrecognized Anyang plant site, with a book value of KRW 410.0bn, as 2.6% of NAV.

The share price has traded near the company's own book value per share, neither at a large premium nor a deep discount to net assets, while the earnings-based multiple sits below the KOSPI average.

Dividends were raised versus the prior year, and the payout ratio for fiscal 2025 was reported at about 26.5%, meeting the criteria for separate taxation of dividend income, though the dividend yield on market price fell versus the prior settlement as the share price rose faster than the dividend.

As for broker views, Daishin Securities said on May 4, 2026 that it raised its target price from KRW 230,000 to KRW 300,000, and BNK Investment & Securities said on August 5, 2026 that it maintained a Buy rating and a target price of KRW 260,000 — these are those firms' views, not judgments of this report.

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 2026-09-04

Bull factors

Three affiliates recovering at once

Equity-method income, the core of holding-company profit, expanded quickly. Equity-method income was KRW 147.0bn in 2Q26, up 169% year on year, with Hyosung TNC the largest contributor and other core affiliates including Hyosung Chemical also improving (BNK Investment & Securities, August 2026).

In 1Q26, Hyosung Heavy Industries' operating profit rose 48.7% year on year, Hyosung TNC grew earnings on higher spandex prices, and the previously loss-making Hyosung Chemical turned to profit. Confirmed figures show the consolidated operating margin rising from 1.7% in 2022 to 16.2% in 2025.

Visibility from the US grid backlog

Order metrics at the largest affiliate act as a leading signal for profit. Hyosung Heavy Industries posted record quarterly operating profit of KRW 264.3bn on revenue of KRW 1,687.0bn in 2Q26, with new orders up 51% year on year at KRW 3,324.2bn.

The US accounted for about 38% of 2Q26 heavy-industries revenue but 63% of orders and 57% of backlog, suggesting a rising North American share.

Because long-lead-time ultra-high-voltage equipment converts backlog into revenue over several years, shifts in the regional and product mix of that backlog feed directly into the holding company's equity-method income.

Shareholder-return policy being formalized

Change is under way toward greater predictability in holding-company dividends. The March 2026 value-up plan targeted a payout ratio of at least 25% of net profit attributable to owners, and total dividends rose 66.7% from KRW 50.2bn for 2024 to KRW 83.6bn for 2025.

Reports add that a first group-level medium-term dividend guideline is under internal review to reduce the dividend uncertainty typical of holding companies (IB Tomato, August 2026).

Analysts noted that continued normalization at Hyosung Chemical would reduce cash-outflow uncertainty from affiliate support and could widen capacity for shareholder returns.

Bear factors

Seasonal downturn in spandex prices

Spandex prices, which drive a large part of equity-method income, face second-half downward pressure in some forecasts.

On June 18, 2026 NH Investment & Securities said it expected second-half spandex price declines, cutting its Hyosung TNC target price from KRW 730,000 to KRW 540,000 and lowering its annual operating profit estimate by 10.6%.

It also said expectations for market-share gains had faded after competitor Lycra completed restructuring and exited bankruptcy protection, and it removed a 10% premium previously applied to its target multiple.

Rising spandex inventory days in China and a slowing price uptrend prompted concerns in the market that the cycle had peaked.

NAV concentrated in one affiliate

The holding company's value is effectively tied to a single stock. On Daishin Securities' estimate the Hyosung Heavy Industries stake was 82.7% of total NAV, and the report noted that Hyosung's share price therefore tracks that affiliate's moves (May 2026).

Power-equipment conditions hinge on US utility investment and data center ordering schedules, so a slowdown in that cycle would compress both holding-company profit and NAV together. In August 2026 the affiliate's share price pulled back alongside a broader correction in utility-related names.

Reliance on non-operating income and rising leverage

Confirmed results flag questions about earnings quality. Net profit attributable to owners of KRW 453.2bn in 2024 far exceeded that year's operating profit of KRW 221.1bn, implying a large contribution from non-operating items such as equity-method and valuation gains.

In 2025 operating profit rose to KRW 393.0bn while net profit attributable to owners fell to KRW 329.9bn, showing how volatile non-operating items can swing the bottom line.

On the balance sheet, total liabilities grew from KRW 1,836.4bn in 2024 to KRW 2,529.9bn in 2025 and the debt-to-equity ratio rose from 73.3% to 88.5%, while operating cash flow declined from KRW 464.8bn to KRW 421.1bn.

Risk factors

Trade and regulatory risk

The key affiliate's profits depend heavily on the US market. As of 2Q26, 63% of heavy-industries orders and 57% of backlog were US-related.

Ultra-high-voltage transformer exports to the US from the Changwon plant were previously delayed by anti-dumping issues, so tariff and anti-dumping determinations and local certification steps can shift the timing of revenue recognition.

Any delay in large-load tariff approvals or the Federal Energy Regulatory Commission's interconnection rule revisions could push ordering out as well.

Affiliate support and balance-sheet risk

Holding-company cash is exposed to affiliate conditions. Regarding Hyosung Chemical, one analysis said in May 2026 that returning to the pre-impairment discount rate was premature given remaining debt burdens.

The company said it has no further funding-support plan, though commentary also noted that swings in affiliate earnings or unexpected funding needs could require pacing dividend growth. The rise in the debt-to-equity ratio from 73.3% in 2024 to 88.5% in 2025 in the confirmed accounts is another item to monitor.

Portfolio risk

Consolidated units and equity-method affiliates ride different cycles. Korea's ATM market is contracting as non-face-to-face channels spread, leaving growth reliant on emerging-market demand and financial kiosks.

In chemicals, commodity ethylene margins were observed below break-even, widening the gap versus downstream products. Consumer- and rate-sensitive businesses such as imported-car dealership and property development are also consolidated, so shifts in interest rates and consumer demand can affect consolidated profit.

What to watch next

Late October to early November 2026
Third-quarter 2026 results for Hyosung and for Hyosung Heavy Industries, Hyosung TNC and Hyosung Chemical. Key items are the size of equity-method income, new orders and the North American share of backlog in heavy industries, and how much of any spandex price decline shows up in reported profit.
Fourth quarter of 2026
Whether ultra-high-voltage transformer exports from the Changwon plant to the US ramp up in earnest, and the operating status of the US joint-venture breaker and transformer plants. Whether local production and exports rise together will shape the heavy-industries margin path.
4Q 2026 to 1Q 2027
Whether the medium-term dividend guideline is formally disclosed, and the fiscal 2026 dividend decision. Whether quantitative criteria such as dividend growth rates are added to the payout target will gauge the predictability of shareholder returns.
Second half of 2026 through 2027
Expansion of US states approving large-load tariffs and progress on the Federal Energy Regulatory Commission's large-load interconnection rule revision. The pace of rulemaking can pull forward or delay orders for ultra-high-voltage transformers and breakers.
During 2027
The actual start-up timing and utilization trend for roughly 125,000 tonnes of new spandex capacity expected in 2027. Earlier start-ups could disturb the supply-demand improvement, while delays would tend to reduce volatility in Hyosung TNC's earnings.

Overall view

Hyosung is a holding company whose own business is managing subsidiary stakes and collecting royalties, and its consolidated results are the sum of three distinct cycles: power equipment, spandex and banking automation.

Confirmed figures show the consolidated operating margin improving from 1.7% in 2022 to 2.7% in 2023, 9.7% in 2024 and 16.2% in 2025, with 2Q26 revenue of KRW 733.6bn and operating profit of KRW 231.6bn marking a step-up in quarterly earnings power.

The bull case rests on Hyosung Heavy Industries' US-weighted backlog, improving spandex supply-demand, Hyosung TNS's shift to higher-value products, and the payout target plus the medium-term dividend guideline under review.

The bear case rests on possible second-half spandex price declines, a structure in which roughly 82% of net asset value sits in a single affiliate, and reliance on non-operating and equity-method income alongside rising leverage.

Valuation debate centers on the discount to net asset value rather than earnings multiples, and Daishin Securities said in May 2026 that it narrowed that discount from 72% to 68%.

What remains to be verified is the durability of affiliate earnings, the US trade and regulatory calendar, and how far dividend policy is formalized. This report is for information purposes only and contains no buy or sell opinion and no target price.

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.