PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩403 per share · Prices as of the 2026-10-02 close
Amid a slowdown in construction activity that has weighed on both revenue and profitability, the company's high-dividend stance stands in contrast to a share price that trades well below book value.
Annual revenue fell to KRW 14.1 billion in 2025 while the operating loss widened to KRW 4.3 billion.
The fourth-quarter 2025 operating loss reached KRW 2.6 billion, far larger than the losses seen in surrounding quarters.
Losses continued through the first two quarters of 2026, though the scale narrowed compared with the fourth quarter of 2025.
The company disclosed a 2026 corporate value-up plan targeting continued leadership in the domestic toilet-parts market.
The firm is classified as a high-dividend company under tax incentive law, and its 2025 dividend payout rose sharply from the prior year.
Watos Corea was founded in 1973 and listed on KOSDAQ in 2005 as a manufacturer specializing in plastic parts and plumbing materials for sanitary ware. The company manufactures and sells plastic components used in sanitary ceramics, with most of its revenue derived from toilet tank fittings.
Starting from parts inside toilet low-tanks, the product line has expanded to wash basin pop-ups, toilet seats, and shower heads. Its core toilet fitting products are understood to account for about 47 percent of total revenue.
The company is reported to hold a leading position with roughly 70 to 80 percent share of the domestic market for core toilet parts.
It maintains supply relationships spanning more than 20 years with major domestic sanitary ware makers including Daelim B&Co, Kolon Ceramics-affiliated Gyerim Ceramics, and IS Dongseo, providing a stable business foundation.
Production takes place at a plant in Jangseong, Jeollanam-do using materials such as ABS, acetal, and PP, while a separate sales and after-service center operates in Incheon.
Because the downstream market is closely tied to construction and housing, the company's performance is sensitive to trends such as new apartment move-in volume and remodeling demand.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩3.3B | -₩400M | −12.9% |
| 2025Q3 | ₩3.6B | -₩500M | −12.7% |
| 2025Q4 | ₩3.5B | -₩2.6B | −76.0% |
| 2026Q1 | ₩3B | -₩800M | −27.6% |
| 2026Q2 | ₩3.4B | -₩500M | −14.1% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩19.5B | ₩100M | ₩5.3B | 0.7% | 6.8% | 6.3% |
| 2023 | ₩17.7B | -₩90,314,143 | ₩2.7B | −0.5% | 3.4% | 5.2% |
| 2024 | ₩17.5B | -₩200M | ₩2.1B | −1.4% | 2.6% | 6.2% |
| 2025 | ₩14.1B | -₩4.3B | -₩2.7B | −30.6% | −3.9% | 6.9% |
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
Annual results showed revenue of KRW 19.5 billion, operating profit of KRW 0.14 billion (operating margin 0.7 percent), and net income of KRW 5.3 billion in 2022, followed by a downward shift.
In 2023 revenue fell to KRW 17.7 billion with a small operating loss of KRW 0.09 billion, while net income held at KRW 2.7 billion. In 2024 revenue was KRW 17.5 billion and the operating loss was KRW 0.25 billion (margin of -1.4 percent), yet net income still came in positive at KRW 2.1 billion.
In 2025, however, revenue dropped sharply to KRW 14.1 billion and the operating loss widened to KRW 4.3 billion (margin of -30.6 percent), pushing net income into a loss of KRW 2.7 billion.
On a quarterly basis, operating losses in the second quarter of 2025 (KRW 0.43 billion) and third quarter (KRW 0.45 billion) of 2025 were relatively moderate, but the fourth-quarter operating loss jumped to KRW 2.6 billion, accounting for most of the full-year loss.
Losses continued into 2026, with an operating loss of KRW 0.83 billion in the first quarter and KRW 0.48 billion in the second quarter, both narrower than the fourth-quarter 2025 figure.
Net losses also narrowed from KRW 2.8 billion in the fourth quarter of 2025 to KRW 0.23 billion in the first quarter of 2026 and KRW 0.03 billion in the second quarter.
The pattern suggests that as revenue continued to decline, a relatively fixed cost base weighed increasingly on margins, translating operating deterioration into net losses.
The sanitary ware parts industry is a downstream sector closely tied to the construction and housing cycle. Recent weak results have been attributed to reduced sanitary ceramics production weighing on demand, combined with a slowdown in toilet fitting demand tied to lower apartment move-in volume.
On a standalone basis, first-quarter 2026 revenue is reported to have fallen 19.1 percent year over year, with the operating loss widening 5.7 percent and net income turning negative.
On the other hand, strengthening government water-conservation policy is cited as a factor that could expand the market for water-saving fittings, and the company is responding by developing new water-saving products and diversifying its lineup to improve user convenience.
In terms of competitive structure, long-standing supply relationships with the three major domestic sanitary ceramics makers act as a barrier to entry, while pricing pressure from lower-cost imported parts remains a persistent factor.
The timing of a recovery in new housing supply, move-in volume, and remodeling demand remains the key variable for any rebound in performance.
The company disclosed a 2026 corporate value-up plan aimed at maintaining its leading domestic market share in toilet parts. The plan includes maintaining product competitiveness, responding to new products and structural change, and continuing steady development so as to benefit if the construction cycle recovers.
It also stated an intention to focus on the existing sanitary ware parts business to keep revenue stable. On the dividend front, the company is classified as a high-dividend firm under the tax incentive law, with a stated 2025 payout ratio of 25 percent.
The 2025 dividend payment is reported to have risen 83.06 percent year over year to about KRW 2.6 billion. Continued development of water-saving fitting products and lineup diversification means that whether government policy generates fresh demand remains a point to watch.
However, no explicit revenue-growth guidance or large-scale capacity expansion or order plans have been confirmed, suggesting the company's strategy centers on securing stability in its existing business rather than pursuing expansion.
The shift from modest profitability in recent years to losses in 2025 has made it difficult to apply traditional earnings-based valuation metrics on a per-share basis. Relative to net assets, the shares trade at a level well below book value, which from an asset-value perspective could be viewed as a discount.
Whether this discount fully reflects concerns over weak performance, or simply the characteristics of a small, thinly followed stock, is open to interpretation.
On the dividend side, the company's classification as a high-dividend firm under tax incentive law and the sizable year-over-year increase in dividend payments stand out as notable factors.
Should earnings eventually turn and enter a recovery phase, the market's read on valuation could shift, but this would need to be confirmed through future earnings releases.
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
The company reportedly holds a 70 to 80 percent share of the domestic market for core toilet parts and maintains supply contracts spanning more than 20 years with the three major domestic sanitary ceramics makers. Such relationships can act as a barrier to new entrants. Its 2026 corporate value-up plan explicitly targets maintaining this leading domestic market share.
Strengthened government water-conservation policy is cited as a factor that could expand the market for water-saving fittings, and the company is developing new water-saving products while diversifying its lineup to improve usability.
Its accumulated technical know-how and multiple industrial property rights in its existing product areas are seen as a strength in responding to policy shifts.
The company is classified as a high-dividend firm under tax incentive law, with a stated 2025 payout ratio of 25 percent.
The 2025 dividend payment is reported to have risen 83.06 percent year over year to about KRW 2.6 billion, indicating a continued commitment to shareholder returns independent of the scale of net income.
Reduced sanitary ceramics production has continued to weigh on downstream demand, and a decline in new apartment move-in volume is directly translating into weaker demand for toilet fittings.
First-quarter 2026 standalone revenue is reported to have fallen 19.1 percent year over year, reflecting the industry downturn directly in results.
The 2025 operating margin fell to -30.6 percent, and the fourth-quarter operating loss of KRW 2.6 billion was far larger than in surrounding quarters, accounting for most of the annual loss. This pattern suggests that a relatively fixed cost base amid declining revenue has weighed heavily on profitability.
The sanitary ware parts market is understood to face persistent price competition from low-cost imported products. If competition intensifies amid stagnant domestic market growth, this could weigh on any recovery in margins.
The company's performance is heavily influenced by new housing sales and move-in volumes, meaning downstream demand could weaken further depending on real estate regulation or interest rate conditions. Should a construction-cycle recovery be delayed, the revenue decline could persist longer than expected.
If cost structures with fixed-cost characteristics persist while revenue shrinks, a recovery in operating margin could be delayed. The pattern seen in the fourth quarter of 2025, in which losses expanded sharply in a single quarter, cannot be ruled out from recurring.
As a small-cap stock, trading volume and liquidity can be limited, and analyst coverage is relatively sparse, resulting in lower information accessibility. This can raise the potential for a gap between the share price and underlying fundamentals.
The third-quarter 2026 quarterly report filing should be checked to see whether revenue and operating results show improvement.
The 2026 annual business report should be checked to confirm full-year results and the finalized 2026 dividend policy, including payout ratio and dividend amount.
New apartment move-in volume and housing start statistics released by authorities such as the Ministry of Land, Infrastructure and Transport should be monitored for signs of a downstream demand recovery.
Any changes to detailed standards or certification systems under government water-conservation policy, along with the company's launch schedule for new water-saving products, should be tracked.
Watos Corea has long maintained a dominant position in the domestic toilet parts market, built on accumulated technical expertise and long-standing customer relationships.
However, 2025 revenue fell to KRW 14.1 billion while the operating loss widened to KRW 4.3 billion, marking a clear shift from the modest profitability seen from 2022 through 2024 into outright losses.
In particular, the fourth-quarter 2025 operating loss of KRW 2.6 billion accounted for most of the annual loss, and while losses continued through the first half of 2026, their scale showed some narrowing.
Declining new apartment move-in volume and reduced sanitary ceramics production are cited as key drivers of the weak performance, while strengthened government water-conservation policy is mentioned as a potential source of new demand.
The company's 2026 corporate value-up plan targets stability in its existing business and continued domestic market leadership, and as a company classified as high-dividend under tax incentive law, it has continued to expand dividend payments.
Relative to net asset value, the shares trade at a notably discounted level, though this remains a factor to monitor alongside the future direction of earnings.
Before drawing any conclusions, it is worth comprehensively checking upcoming quarterly results, housing market indicators, and whether the dividend policy remains in place.
Report written 2026-09-05 · Data as of 2026-09-04
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