PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩250 per share · Prices as of the 2026-10-02 close
Brake pad and lining specialist KB Autosys has lifted its operating margin from the 1% range in 2022 to around 4% in 2025, while diversifying its OEM customer base on the back of production bases in the US, China and India.
FY2025 consolidated revenue of KRW 214.996bn and operating profit of KRW 8.531bn (4.0% margin), marking four straight years of revenue and profit growth
Owner net income totaled KRW 7.885bn over the four quarters from 2025Q3 to 2026Q2, though quarterly swings remain sizable
The company reportedly holds a high share of Hyundai-Kia brake pad supply and domestic EV friction material demand, while expanding customers to GM, Stellantis and Ford
The company operates a US plant in Meriwether County, Georgia, alongside China and India subsidiaries, supporting a rising share of overseas sales
The company has begun mass production of copper-free friction materials to address tightening environmental rules in North America and Europe
Founded in 1985, KB Autosys is a specialized manufacturer of automotive brake pads (friction materials) and linings, producing components for OEM and aftermarket channels through domestic facilities and overseas subsidiaries.
According to media reports, the company is estimated to supply more than 38% of brake pads used in Hyundai and Kia vehicles and to hold over 90% of the domestic EV friction material market.
Its customer base originated with Hyundai-Kia and expanded when it began supplying brake pads to General Motors in 2015, later winning large orders for Stellantis and Ford flagship models.
Reports indicate the export share of sales has risen above 65%, supported by production bases in Georgia (US), Zhangjiagang (China) and India as part of the company's globalization strategy.
In Georgia's Meriwether County, KB Autosys invested roughly USD 38 million to build a manufacturing facility expected to create about 180 jobs.
The company is reported to spend more than 6% of sales annually on R&D, and building on its history as Korea's first developer of non-asbestos friction material, it now mass-produces copper-free friction products for both the domestic and North American markets.
The brake component OEM market has high entry barriers, favoring a small number of suppliers with proven quality and technology, with Mando Corporation cited as a domestic competitor.
Demand for brake pads is driven not only by new vehicle production but also by aftermarket replacement tied to rising average vehicle age.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩56B | ₩3.4B | 6.0% |
| 2025Q3 | ₩52.6B | ₩700M | 1.4% |
| 2025Q4 | ₩55.2B | ₩3.7B | 6.6% |
| 2026Q1 | ₩57.4B | ₩1.5B | 2.7% |
| 2026Q2 | ₩59B | ₩1.9B | 3.2% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩178B | ₩2.4B | ₩1.1B | 1.4% | 1.1% | 103.4% |
| 2023 | ₩203.7B | ₩4B | ₩1.1B | 2.0% | 1.0% | 106.8% |
| 2024 | ₩210.2B | ₩4.6B | ₩2.9B | 2.2% | 2.5% | 102.3% |
| 2025 | ₩215B | ₩8.5B | ₩3.9B | 4.0% | 3.3% | 115.4% |
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
KB Autosys's consolidated revenue rose for four consecutive years, from KRW 178.04bn in 2022 to KRW 203.73bn in 2023, KRW 210.23bn in 2024 and KRW 214.996bn in 2025.
Over the same period, operating profit improved even faster than revenue, climbing from KRW 2.44bn (1.4% margin) in 2022 to KRW 4.04bn (2.0%) in 2023, KRW 4.63bn (2.2%) in 2024 and KRW 8.53bn (4.0%) in 2025, marking a clear margin recovery.
Owner net income also expanded from KRW 1.10bn in 2022 and KRW 1.06bn in 2023 to KRW 2.94bn in 2024 and KRW 3.90bn in 2025.
According to FnGuide data, first-half 2025 consolidated revenue rose 2.7% year on year, operating profit surged 614.9%, and net income grew 77.7%, showing that the profitability improvement was already visible in the first half.
On a quarterly basis, after posting revenue of KRW 55.96bn and operating profit of KRW 3.35bn in 2025Q2, revenue dipped slightly to KRW 52.62bn in 2025Q3 while operating profit contracted sharply to KRW 0.73bn, before rebounding to KRW 55.16bn in revenue and KRW 3.66bn in operating profit in 2025Q4, underscoring notable quarter-to-quarter volatility.
Revenue continued to grow to KRW 57.43bn and KRW 59.03bn in 2026Q1 and 2026Q2 respectively, but operating profit came in lower at KRW 1.54bn and KRW 1.87bn than the 2025Q4 level.
In contrast, owner net income moved somewhat differently from the operating profit trend, registering KRW 0.88bn in 2025Q3, KRW 2.67bn in 2025Q4, KRW 2.19bn in 2026Q1 and KRW 2.14bn in 2026Q2, likely reflecting non-operating items such as foreign-exchange related gains or losses affecting quarterly net income.
Summed across the four quarters from 2025Q3 to 2026Q2, owner net income reached KRW 7.885bn, suggesting the earnings recovery trend has continued on an annualized basis.
The global friction material market is projected to grow from about 860 million units in 2026 to roughly 1.07 billion units by 2031, a 4.36% CAGR, with Nisshinbo Holdings, Tenneco, Akebono Brake Industry, Brembo and TMD Friction cited as major competitors, while Mando Corporation is regarded as the leading domestic rival.
Some research firms estimate the broader automotive brake components market will grow at an 8.7% CAGR from 2026 to 2034, reaching roughly USD 32 billion by 2034.
Regulatory shifts are also reshaping the industry: in North America, copper-content rules in California and Washington have added USD 2-4 per set to raw material costs, accelerating product reformulation, while in Europe, Euro 7 brake dust emission limits are pushing automakers toward ultra-low-wear ceramic materials.
The spread of electric vehicles has a dual effect on the friction material industry—regenerative braking reduces brake pad wear, yet the EV-specific brake pad market is forecast to grow at roughly a 17.5% CAGR from 2026 to 2035, boosting demand for low-wear, low-noise specialized products.
KB Autosys, reportedly holding a high share of Korea's domestic EV friction material market, is seen as relatively well positioned for this structural shift.
At the same time, compliance costs tied to raw-material (copper) regulation and tightening emission standards in the US and Europe add to material-development investment burdens for smaller friction material makers.
KB Autosys operates a manufacturing facility in Meriwether County, Georgia, built with an investment of roughly USD 38 million, to serve North American parts demand from GM and other automakers in addition to Hyundai-Kia; a report from early 2025 indicated that, even before the plant reached three years of operation, the company was already considering expanding capacity in response to rising customer requests.
This overseas customer expansion has reportedly translated into large orders for Stellantis and Ford flagship models, and whether the export-share expansion trend continues is a key point to monitor going forward.
The company is reported to already mass-produce copper-free friction materials for both the domestic and North American markets, giving it a product portfolio positioned to address tightening environmental regulations in North America and Europe, which could influence future order competitiveness.
However, no specific confirmed disclosure or timeline for the US plant expansion has been identified as of this review, so the scale and timing of any actual investment decision requires further confirmation.
Variables such as the pace of automakers' North American production expansion, EV transition speed, and Hyundai Motor Group's US localization strategy could also affect KB Autosys's medium-term revenue mix.
No official company guidance on future revenue or specific new capacity expansion plans was identified as of this review.
KB Autosys shares appear to trade at a level below the company's net asset value, which can be read as reflecting both the possibility that the earnings recovery of recent years has not yet been fully priced in, and the generally low valuation multiples commonly observed across the KOSDAQ auto parts sector.
Given that profitability shifted from thin margins around 2022 to a clearer margin-improvement phase by 2025, the current valuation level may still carry some legacy discount from the earlier period of weaker performance.
On the dividend side, the company appears to maintain a gradual cash dividend policy, and whether earnings improvement translates into dividend expansion will depend on future results and board decisions.
Views on the direction of the valuation level may differ across investors, and this report does not forecast any particular direction.
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
Operating margin has improved every year from 1.4% in 2022 to 4.0% in 2025, with profit growth outpacing revenue growth. This suggests cost control, product mix improvement, or price-linkage mechanisms with customers are functioning effectively. Whether this trend continues needs further confirmation in upcoming quarterly results.
Reports indicate the customer base has expanded beyond Hyundai-Kia to include GM, Stellantis and Ford, with the export share reportedly rising above 65%. This can be interpreted as a shift toward reducing reliance on any single customer. However, specific revenue breakdowns by customer require further verification.
The company reportedly holds a high share of Korea's domestic EV friction material market, and the global EV-specific brake pad market is forecast to grow at a relatively fast rate, which can be viewed positively from a business-fundamentals perspective. The company also has regulatory-compliant technology such as copper-free products.
Operating profit fell sharply to KRW 0.73bn in 2025Q3 from KRW 3.35bn in the prior quarter, and operating profit in 2026Q1 and Q2 also came in below the 2025Q4 level of KRW 3.66bn.
Quarter-to-quarter variance tied to production schedules, customer order timing and raw material prices appears significant, making it difficult to predict quarterly results from the annual trend alone.
The 2025 operating margin of 4.0%, while improved, remains modest in absolute terms, and the possibility of margins being compressed again by raw material or currency fluctuations cannot be ruled out. The historical pattern of relatively modest profit levels compared to capital base is also worth noting.
Revenue dependence on Hyundai-Kia is presumed to remain substantial, meaning production or sales weakness at a specific automaker could directly affect results.
Whether and when the Georgia plant will be expanded does not appear to be concretely finalized, making execution of overseas capacity expansion plans another factor to monitor.
Revenue dependence on a limited number of automakers such as Hyundai-Kia is presumed to be relatively high, meaning weak vehicle sales or order adjustments could immediately affect results. Customer diversification is underway, but specific revenue shares by customer are not confirmed in publicly available data.
Friction materials are manufactured by blending numerous raw materials, and rising prices for regulated inputs such as copper or foreign-exchange fluctuations could add to cost pressure.
The observed divergence between quarterly net income and operating profit also suggests possible influence from non-operating foreign-exchange gains or losses.
The spread of regenerative braking systems with EV adoption could reduce per-vehicle brake pad wear rates, potentially affecting aftermarket demand structure over the long term. At the same time, tightening emission regulations such as Euro 7 could increase the investment burden for new product development.
The consolidated Q3 2026 (July-September) earnings disclosure is expected around this time, a key point to check whether the sharp operating-profit dip seen in 2025Q3 repeats and whether the margin recovery persists.
Watch for any additional disclosure or news regarding whether the Georgia manufacturing facility expansion proceeds and the specifics of any investment plan.
It will be worth monitoring how North American production and sales trends at key customers such as Hyundai-Kia, GM, Stellantis and Ford, along with any new order wins, affect the revenue mix.
The FY2026 annual results and dividend disclosure timing, useful for confirming whether the margin improvement trend seen since 2025 continues on an annual basis.
KB Autosys is a brake pad and lining specialist that has sustained an earnings recovery since 2022, with both revenue and operating margin improving in tandem.
The company has broadened its customer base beyond Hyundai-Kia to include GM, Stellantis and Ford, and appears to have raised its overseas sales share through production bases in the US, China and India.
However, quarterly earnings volatility remains significant, as illustrated by the sharp operating-profit decline in 2025Q3, and absolute margin levels are still not particularly high.
Raw material and foreign-exchange fluctuations, dependence on specific automakers, and execution of overseas capacity expansion plans remain variables for future results.
The spread of regenerative braking with EV adoption and tightening emission regulations could have a dual impact on the industry structure, with the company's relative position in the EV friction material market offering potential benefits alongside compliance cost burdens that also warrant consideration.
Investors will want to continue monitoring upcoming quarterly disclosures and news related to the US plant expansion to assess whether the earnings recovery trend persists.
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.