PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q2–2026Q1) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close
Revenue has declined for four straight years, but net income attributable to owners turned positive over the most recent four quarters, while the largest shareholder changed to Osung Hi-Metal, reshaping the governance structure.
2025 revenue fell to KRW 100.8 billion from KRW 119.8 billion a year earlier, with an operating loss of KRW 2.28 billion as the operating margin declined for a fourth straight year.
Over the most recent four quarters (Q2 2025 to Q1 2026), cumulative net income attributable to owners was about KRW 1.0 billion, turning positive after the 2025 full-year loss.
In June-July 2025, Osung Hi-Metal acquired stakes from Kumho HT and Ecovault to become the largest shareholder, later raising its stake to 36.8% through open-market purchases as of late July 2025.
Medical cannabis R&D through subsidiary Cannabis Medical (49.15% stake) has drawn thematic attention, but domestic commercialization remains uncertain.
The debt ratio stood at a low 3.0% at the end of 2025, indicating a stable balance sheet, while the recent share price trades below net asset value per share.
Founded in 1974, Hwail Pharm is a mid-sized KOSDAQ-listed pharmaceutical company whose core business is the manufacture and sale of active pharmaceutical ingredients (API), alongside finished cephalosporin-class antibiotics and functional health food ingredients.
The company has supplied pharmaceutical raw materials to more than 300 domestic and overseas drugmakers for over three decades and is regarded as one of the leading API producers in Korea.
By revenue within the 'pharmaceutical compounds and antibiotics manufacturing' industry classification, the company ranks in the sixth-to-seventh tier alongside peers such as Hyundai Bioland, Daejung Chemicals, Caregen, and Hitech Pharm.
Key products include the API erdosteine and finished formulations such as expectorants, gastric function regulators, antispasmodics, and analgesic anti-inflammatories.
In June-July 2025, the largest shareholder changed from Kumho HT to Osung Hi-Metal, consolidating the governance structure under a single control chain topped by Chairwoman Cho Kyung-sook.
Osung Hi-Metal, a KOSDAQ-listed optical film maker that also functions as the group's de facto holding company, is exploring business synergies between its subsidiary Cannabis Medical, which conducts medical cannabis research, and Hwail Pharm.
Hwail Pharm holds a 49.15% stake in Cannabis Medical and recently acquired an additional 6.06% stake in Fanjen for KRW 7.12 billion to pursue further business synergy.
In March 2026, the co-CEOs changed from Cho Kyung-sook and Seo Saeng-kyu to Kim Yu-jung and Seo Saeng-kyu, alongside a 10-to-1 share consolidation and treasury share retirement to restructure the capital base.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q1 | ₩30B | -₩1.2B | −4.0% |
| 2025Q2 | ₩28B | ₩50,913,808 | 0.2% |
| 2025Q3 | ₩24.3B | ₩200M | 0.7% |
| 2025Q4 | ₩18.6B | -₩1.3B | −7.0% |
| 2026Q1 | ₩23.4B | -₩600M | −2.4% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩132.1B | ₩4.8B | -₩6.3B | 3.6% | −3.6% | 5.7% |
| 2023 | ₩122.5B | ₩2B | ₩3.9B | 1.7% | 2.2% | 6.6% |
| 2024 | ₩119.8B | ₩800M | ₩6.5B | 0.6% | 3.2% | 6.0% |
| 2025 | ₩100.8B | -₩2.3B | -₩200M | −2.3% | −0.1% | 3.0% |
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
Hwail Pharm's revenue declined for four consecutive years, from KRW 132.1 billion in 2022 to KRW 122.5 billion in 2023, KRW 119.8 billion in 2024, and KRW 100.8 billion in 2025.
The operating margin also slid from 3.6% in 2022 to 1.7% in 2023 and 0.6% in 2024 before turning negative at -2.3% (an operating loss of KRW 2.28 billion) in 2025.
Net income attributable to owners swung from a loss of KRW 6.33 billion in 2022 to profits of KRW 3.86 billion in 2023 and KRW 6.48 billion in 2024, before reverting to a loss of KRW 233 million in 2025.
On a quarterly basis, Q1 2025 posted revenue of KRW 30.0 billion with an operating loss of KRW 1.20 billion and a net loss of KRW 657 million, while Q2 and Q3 2025 turned profitable with operating income of KRW 51 million and KRW 165 million and net income of KRW 551 million and KRW 388 million, respectively.
However, Q4 2025 weakened again, with revenue falling to KRW 18.6 billion and an operating loss of KRW 1.30 billion and net loss of KRW 516 million.
The most recent quarter, Q1 2026, recorded revenue of KRW 23.4 billion and an operating loss of KRW 566 million, yet net income was positive at KRW 579 million, suggesting a contribution from non-operating items.
As a result, cumulative net income attributable to owners over the most recent four quarters (Q2 2025 to Q1 2026) reached roughly KRW 1.0 billion, marking a shift away from the full-year 2025 loss. Notably, operating cash flow held up at KRW 11.88 billion in 2025 despite the net loss, a point worth flagging.
Korea's API industry has faced pressure from rising raw material costs sourced from China and India along with higher labor costs, pushing up production costs and squeezing already thin margins across the sector, according to industry commentary.
Hwail Pharm has mirrored this trend, with both revenue and operating margin contracting over recent years. The finished cephalosporin-class antibiotics segment operates in a highly competitive domestic generics market, where cost pressure directly affects pricing competitiveness.
The functional health food ingredients business, including coenzyme Q10, carries more of a consumer-goods character than API and is viewed as offering relatively more room for differentiation.
By industry revenue ranking, Hwail Pharm competes in a similar weight class to peers such as Hyundai Bioland, Daejung Chemicals, Caregen, and Hitech Pharm.
More recently, market attention has shifted from standalone earnings toward the governance restructuring following Osung Hi-Metal's entry and the linked medical cannabis new-business narrative.
No specific revenue or profit guidance from the company has been confirmed. However, the March 2026 annual general meeting approved a 10-to-1 share consolidation, articles of incorporation amendments, and a change of co-CEOs, moving capital structure and management reorganization toward completion.
Largest shareholder Osung Hi-Metal has continued open-market purchases since its 2025 stake acquisition, and the market has speculated that Hwail Pharm could be repositioned as a strategic subsidiary within the group.
Business synergy with Cannabis Medical, along with the newly acquired 6.06% stake in Fanjen, are cited as points to watch going forward.
Domestically, legislative discussions on medical cannabis activation continue, including a National Assembly forum, but an actual legalization or commercialization timeline has not been confirmed.
Given the profitable trend over the most recent four quarters, whether this continues or reverts to weakness similar to Q4 2025 will be a key point to monitor in coming quarters.
The current share price trades below the company's net asset value per share, which can be viewed as a discount relative to its asset base. However, given that the recent earnings base remains small, the price relative to earnings appears elevated compared with the 2023-2024 profit-recovery period.
The company has not paid dividends recently, limiting analysis from a yield perspective. A low debt ratio and stable balance sheet are factors that can support an asset-based valuation view.
Governance restructuring and expectations around the medical cannabis new business also act as variables influencing valuation, warranting attention to both earnings fundamentals and event-driven factors together.
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
The 2025 change of largest shareholder to Osung Hi-Metal consolidated a multi-layered governance structure under a single control chain. Osung Hi-Metal, which functions as the group's holding company, has continued open-market purchases, raising its stake to 36.8% as of late July 2025.
The market has speculated that Hwail Pharm could be repositioned as a strategic group subsidiary with higher resource-allocation priority.
While the 2025 full year posted a net loss, cumulative net income attributable to owners over the four quarters from Q2 2025 to Q1 2026 was positive at roughly KRW 1.0 billion. Operating income also turned positive in Q2 and Q3 2025. Operating cash flow remained solid at KRW 11.88 billion in 2025.
The business is diversified across API, finished cephalosporin-class antibiotics, and functional health food ingredients, reducing dependence on any single segment. A stable customer base supplying more than 300 domestic and overseas drugmakers is also a strength. The debt ratio was very low at 3.0% at the end of 2025, reflecting sound financial health.
Revenue fell for four consecutive years, from KRW 132.1 billion in 2022 to KRW 100.8 billion in 2025, while the operating margin declined from 3.6% to -2.3% over the same period. Rising import costs for raw materials and labor cost burdens are cited as structural factors pressuring margins.
Q4 2025 revenue also dropped sharply to KRW 18.6 billion with another loss, indicating that the earnings recovery has not yet been consistently sustained.
Hwail Pharm's largest shareholder has changed multiple times, from Crystal Genomics to Kumho HT and then to Osung Hi-Metal. Affiliate Ecovault previously experienced a trading halt due to a qualified audit opinion, and some views hold that concerns about risk transmission within the group have not been fully resolved.
Some interpretations link the ownership reshuffling to next-generation succession planning, meaning minority shareholders may need to keep monitoring the purpose and direction of governance changes.
Hwail Pharm conducts medical cannabis-related research through subsidiary Cannabis Medical, but relevant domestic regulations remain incomplete. While institutional discussions such as a National Assembly forum are ongoing, no legalization or commercialization timeline has been confirmed.
As a result, it may take time for this business to contribute to earnings, or the outcome may fall short of expectations.
The API business relies heavily on raw materials imported from China and India, so production costs can fluctuate with exchange rates and global raw material prices. Rising labor costs also continue to pressure margins. This cost structure is cited as one factor behind the 2025 shift to a negative operating margin.
Under the governance structure topped by largest shareholder Osung Hi-Metal, the financial condition of affiliated companies could affect Hwail Pharm. There remains a possibility of risk transmission within the group, as seen in the past trading halt of affiliate Ecovault.
Given the succession of stake purchases and capital restructuring, further governance changes should continue to be monitored.
The medical cannabis-related business is heavily dependent on the scope of domestic legal permission and policy direction, leaving persistent uncertainty tied to regulatory change.
As a small-cap KOSDAQ stock with a market capitalization of roughly KRW 0.1 trillion, limited trading volume could amplify share price volatility. Given its small-cap characteristics, short-term price distortions driven by thematic flows are also worth noting.
The Q3 2026 quarterly report filing will show whether revenue and operating income continue the improvement seen in Q1 2026 or revert to the weakness observed in Q4 2025.
Additional stake purchases or ownership structure disclosures by largest shareholder Osung Hi-Metal may continue, warranting monitoring for signs of strategic subsidiary repositioning within the group.
Whether legislative and regulatory discussions on medical cannabis activation translate into actual lawmaking is a key variable for gauging the commercialization potential of the Cannabis Medical business.
Follow-up disclosures regarding concrete business cooperation or further stake changes related to the recently acquired 6.06% stake in Fanjen should be checked.
Hwail Pharm has faced four consecutive years of revenue decline and a shift to operating and net losses in 2025, yet net income attributable to owners turned positive over the most recent four quarters (Q2 2025 to Q1 2026).
Osung Hi-Metal rose to become the largest shareholder in June-July 2025, consolidating governance under a single control chain, followed by further stake increases, a management change, and a share consolidation to restructure the capital base.
The medical cannabis business through subsidiary Cannabis Medical and the recently acquired stake in Fanjen have raised hopes for new business synergies, though the domestic legal commercialization timeline remains uncertain.
The balance sheet remains stable with a low debt ratio of 3.0% at the end of 2025, while the share price trades below net asset value per share. Raw material cost pressure, affiliate risk, and regulatory uncertainty remain variables to watch.
The persistence of the recent earnings improvement and the concrete direction of the governance restructuring appear to be the key points that will shape the company's medium-to-long-term picture.
Report written 2026-09-05 · Data as of 2026-09-04
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