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
Ilsung Construction swung back to profit in 2025 after a large loss, but a sharp revenue drop and renewed leverage pressure in the first quarter of 2026 are testing the durability of its balance-sheet repair.
2025 consolidated operating profit reached KRW 10.4bn and owners' net income KRW 3.7bn, reversing the prior year's large losses.
In the first quarter of 2026, revenue fell sharply year-on-year and the net debt-to-EBITDA ratio rose again, according to a credit rating agency.
Order backlog stood at KRW 1.1243tn at end-2025, slightly down from a year earlier, as the company shifts its portfolio toward public-sector, US military base, and overseas ODA projects.
Unsold inventory and PF credit-enhancement risk remain at some TRUEL-branded projects, including those in Cheonan Station and Magok HQ.
In July 2026 the stock surged on expectations tied to a government megaproject theme and was designated an investment-alert stock, reflecting theme-driven trading rather than purely fundamental moves.
Founded in 1978 and listed on the KOSPI in 1989, Ilsung Construction is a mid-sized builder that operates its own apartment brand, TRUEL, across domestic building (housing), civil engineering, and overseas segments.
In Korea, alongside private redevelopment and reconstruction housing projects, the company has been increasing its share of publicly ordered work such as projects for the Korea Land and Housing Corporation (LH) and US military base facilities, a strategy described as risk management amid a weaker housing cycle.
Overseas, it has been strengthening its position in official development assistance (ODA) markets, including the Vietnam Ken Net railway and a rural comprehensive development project in Savannakhet, Laos.
Recently, a decline in domestic building-segment work volume weighed on revenue, while cost reductions and improved profitability in the overseas civil engineering segment helped support operating profit.
Key ongoing projects include TRUEL Signature Cheonan Station in Cheonan, South Chungcheong Province, the Namyangju Wangsuk 2 A-3BL site in Gyeonggi Province, and the Goyang Changnyeong public land site, also in Gyeonggi.
In construction-capability rankings the company is classified as a mid-tier rather than top-tier builder, cited in 2025 industry coverage as ranking in the 50s.
Competitively, rather than competing head-on with large builders, its key task is securing stable revenue in regional/mid-sized housing and public/ODA niche markets.
Management has stated it is focusing on securing overseas ODA-related projects with relatively higher recovery likelihood and work orders in partnership with large corporations.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩115.1B | ₩3.8B | 3.3% |
| 2025Q3 | ₩110.9B | ₩1.8B | 1.6% |
| 2025Q4 | ₩112.5B | ₩1.8B | 1.6% |
| 2026Q1 | ₩84.6B | ₩1.6B | 1.9% |
| 2026Q2 | ₩107.4B | ₩3.7B | 3.5% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩462.6B | ₩2.7B | ₩7.2B | 0.6% | 6.0% | 243.0% |
| 2023 | ₩607.7B | ₩7.3B | ₩4.1B | 1.2% | 3.3% | 227.3% |
| 2024 | ₩500.4B | -₩43.6B | -₩57.5B | −8.7% | −86.5% | 454.4% |
| 2025 | ₩452.7B | ₩10.4B | ₩3.7B | 2.3% | 5.1% | 415.7% |
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
Ilsung Construction's consolidated revenue rose from KRW 462.6bn in 2022 to KRW 607.7bn in 2023, then fell for two consecutive years to KRW 500.4bn in 2024 and KRW 452.7bn in 2025.
Operating profit, by contrast, posted small surpluses of KRW 2.7bn in 2022 and KRW 7.3bn in 2023, swung to a large loss of KRW 43.6bn in 2024, and then turned positive again at KRW 10.4bn in 2025 (operating margin of 2.3%).
Owners' net income followed a similar pattern, moving from a large loss of KRW 57.5bn in 2024 to a profit of KRW 3.7bn in 2025.
The large 2024 loss reflected preemptive allowance provisions related to construction receivables, and the 2025 improvement was driven largely by a sharp reduction in related selling, general and administrative expense burden.
On a quarterly basis, operating profit of KRW 3.77bn and net income of KRW 0.40bn in the second quarter of 2025 were followed by an operating profit of KRW 1.75bn but a net loss of KRW 0.34bn in the third quarter, then an operating profit of KRW 1.85bn alongside a much larger net income of KRW 2.95bn in the fourth quarter — a recurring gap between operating and net results.
In the first quarter of 2026, revenue contracted to KRW 84.6bn, with operating profit of KRW 1.64bn and net income of just KRW 0.37bn, before revenue recovered to KRW 107.4bn in the second quarter, lifting operating profit to KRW 3.72bn and net income to KRW 0.63bn — two straight quarters of expanding profit scale.
Combined owners' net income over the most recent four quarters (Q3 2025 through Q2 2026) totaled roughly KRW 3.6bn, underscoring how thin the annualized earnings base still is.
On the balance sheet, the debt ratio spiked from 227.3% in 2023 to 454.4% in 2024, easing modestly to 415.7% in 2025, but it remains well above pre-2024 levels.
The domestic construction industry sits in a dual phase: a slower housing cycle and lingering project-financing (PF) risk on one side, and new order expectations stirred by large-scale government infrastructure and industrial investment plans on the other.
Large builders are focused on competing for advanced industrial infrastructure such as semiconductor fabs and data centers along with major redevelopment projects, while mid-sized builders like Ilsung Construction face both unsold-inventory pressure in regional housing and a push to pivot toward public-sector and ODA work.
The top tiers of the construction-capability ranking remain dominated by large integrated builders, leaving smaller firms to defend their standing through improvements in construction-performance and financial-condition metrics.
Amid elevated regional unsold-inventory risk, credit rating agencies have noted that expanding public-sector revenue helps stabilize cash flow but offers limited room for profitability improvement.
Meanwhile, the second half of 2026 is seeing the formal launch of main subscriptions for third-generation new towns such as Goyang Changnyeong and Namyangju Wangsuk 2, expanding the supply of publicly developed housing, which could present order opportunities for participating contractors.
Overseas ODA markets are viewed as a relatively stable revenue source decoupled from the domestic housing cycle given higher collection likelihood, though their absolute scale remains smaller than the domestic housing segment.
To improve its financial structure, Ilsung Construction decided in May 2026 to sell land and buildings in Choi-dong, Hanam, Gyeonggi Province for KRW 59.2bn, a sum equal to 15.6% of its recent consolidated total assets, with the company stating the purpose was debt repayment and liquidity.
On the business front, the Namyangju Wangsuk 2 A-3BL site (686 units), for which the company is the contractor under the TRUEL brand, is set to launch its main subscription within 2026 as part of third-generation new town public housing supply that should feed into results.
However, TRUEL Signature Cheonan Station in Cheonan, South Chungcheong Province, which targeted completion in June 2026, had a sales rate around only half at the time of completion, leaving the pace of clearing remaining unsold units as a variable that will shape future financial burden.
The company has stated it intends to focus on overseas ODA projects with relatively higher likelihood of cost recovery and on securing work in partnership with large corporations such as Samsung.
Credit rating agencies see limited further deterioration risk given that allowance provisioning has largely been completed, but expect that easing debt burden metrics such as the debt ratio will take time given constrained earnings power and limited capacity to expand scale.
With order backlog down modestly from a year earlier, securing large new orders to replace completed overseas projects is flagged as key to any revenue rebound.
The share price trades close to net asset value, implying a relatively limited premium over book value, while the price relative to net income appears comparatively high given the still-thin earnings base.
Because the shift from a large 2024 loss to a 2025 profit is recent and quarterly net income remains volatile, simple comparisons of the price-to-earnings level warrant caution. With no recent dividend payment record, dividend-related metrics carry limited reference value at present.
In the first half of 2026, theme-driven flows — including a rally among regional construction stocks tied to government megaproject expectations, followed by broad swings in construction shares on geopolitical headlines — appear to have had a substantial influence on the stock, and such moves should be interpreted separately from underlying earnings fundamentals.
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
With the large 2024 allowance provisioning largely behind it, the 2025 SG&A burden fell sharply and operating profit turned positive at KRW 10.4bn. A credit rating agency assessed that allowances already booked exceed long-overdue receivables, making further near-term provisioning less likely. This could limit downside risk to future earnings.
In response to the housing slowdown, the company is increasing its share of publicly ordered work such as LH and US military base projects along with overseas ODA projects in Vietnam and Laos. The public/ODA segment carries relatively higher collection likelihood, which can support cash-flow stability.
Third-generation new town public housing supply, including the Namyangju Wangsuk 2 A-3BL site, is also set for main subscription within 2026.
In May 2026 the company decided to sell land and buildings in Hanam, Gyeonggi Province for KRW 59.2bn to repay debt and secure liquidity. The disposal size equals 15.6% of recent consolidated total assets, which could meaningfully contribute to near-term balance-sheet repair. This illustrates a proactive approach to managing financial risk.
In the first quarter of 2026, revenue fell sharply year-on-year and expanded working-capital burden pushed free cash flow back into deficit. The net debt-to-EBITDA ratio jumped from 6.6x a year earlier to 10.2x, and the debt ratio rose again to 434.8%. Whether the 2025 balance-sheet improvement trend continues will need to be confirmed in coming quarters.
TRUEL Signature Cheonan Station in Cheonan, South Chungcheong Province, a project for which the company provided joint guarantees on project financing, had a sales rate of only around half at completion. The TRUEL Magok HQ project in Seoul's Gangseo District also saw mass non-contracting and was sent to public auction.
This concentration of unsold-inventory risk in regional and smaller projects could pose a burden if PF contingent liabilities materialize.
Consolidated revenue fell for two straight years, from KRW 607.7bn in 2023 to KRW 500.4bn in 2024 and KRW 452.7bn in 2025. Order backlog also declined 2.9% year-on-year to KRW 1.1243tn at end-2025 from KRW 1.1584tn a year earlier. Failure to secure large new orders to replace completed overseas projects could delay any revenue rebound.
The debt ratio spiked from 227.3% in 2023 to 454.4% in 2024, eased to 415.7% in 2025, but rose again to 434.8% in the first quarter of 2026. The net debt-to-EBITDA ratio has also exceeded 10x, indicating debt burden has grown relative to cash-generating capacity. A credit rating agency expects easing of the financial burden to take time given constrained earnings power.
The Cheonan Station project involved joint guarantees on project-financing loans whose outstanding balance was increased, and the sales rate remained around half even at completion. The Magok HQ project saw accumulated non-contracting that led to a public auction process.
Unsold-inventory risk concentrated in regional and smaller projects could continue to weigh on the financial statements.
In early July 2026 the share price surged more than 60% within five days, triggering the investment-alert stock designation process. Subsequently, construction stocks broadly moved in tandem on geopolitical headlines. Such theme-driven trading swings warrant caution as they can lead to market measures such as trading halts.
The third-quarter 2026 report filing will show whether revenue, operating profit and net debt metrics continue the second-quarter recovery or repeat the renewed financial strain seen in the first quarter.
The main subscription and sales progress of the Namyangju Wangsuk 2 A-3BL site (686 units) will indicate how much third-generation new town public housing volume translates into actual revenue and order backlog.
Following the targeted June 2026 completion of TRUEL Signature Cheonan Station, the pace at which remaining unsold units clear and whether related PF credit-guarantee risk eases should be monitored.
Regular reviews by credit rating agencies such as Korea Ratings will re-examine whether leverage metrics such as the debt ratio and net debt-to-EBITDA multiple have improved.
Ilsung Construction showed a recovery signal on paper, swinging from the large loss driven by 2024 allowance provisioning to a 2025 operating profit of KRW 10.4bn and net income of KRW 3.7bn.
However, with revenue falling sharply and the net debt-to-EBITDA ratio and debt ratio deteriorating again in the first quarter of 2026, it remains uncertain whether the return to profit is translating into a fundamental improvement in the balance sheet.
The company is responding through liquidity measures such as the Hanam property sale and a pivot toward a public-sector and overseas ODA-centered portfolio, with third-generation new town volume such as Namyangju Wangsuk 2 potentially contributing to future revenue.
On the other hand, unsold-inventory and PF risks at certain sites such as Cheonan Station and Magok HQ remain unresolved variables, and order backlog also declined modestly year-on-year.
The stock's movement in the first half of 2026 appears to have been heavily influenced by a government megaproject theme and geopolitically driven swings across construction shares broadly, warranting separation from underlying earnings fundamentals.
Third-quarter results, the trajectory of leverage metrics, and how much public housing volume actually converts into revenue will likely be key variables in gauging whether the balance-sheet improvement proves durable.
Report written 2026-09-05 · Data as of 2026-09-04
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