PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩50 per share · Prices as of the 2026-10-02 close
Zero to Seven is showing a profit recovery trend since 2025, past the 2024 trough, built on two pillars: overseas channel expansion of its infant/sensitive-skin skincare brand Gungjungbichaek and the stable cash flow of its POE packaging business.
2025 consolidated revenue reached KRW 70.95bn (+6.1% YoY), operating profit KRW 2.52bn, and owners' net income KRW 3.45bn, with all three metrics improving.
Gungjungbichaek has rapidly expanded overseas channels, completing rollout to 2,600 Watsons stores in China and entering eight European countries, the UAE, and Southeast Asia.
The POE packaging business, as the sole domestic manufacturer, is diversifying its supply base into ten countries including China, Hong Kong, and Malaysia.
In Q2 2026, revenue was KRW 20.7bn and operating profit KRW 1.77bn, marking the highest quarterly operating margin within the observed window.
In Q4 2025, operating profit was near zero yet net income rose sharply, suggesting one-off items may be mixed into reported earnings.
Zero to Seven is a baby products and consumer goods company affiliated with Maeil Dairies, organized around two main business lines: infant/sensitive-skin skincare and POE packaging materials.
As a subsidiary of Maeil Dairies, the company operates the Gungjungbichaek skincare brand for infants and sensitive skin, alongside a packaging business that manufactures POE (Peel Off End) caps used atop powdered products such as infant formula.
Based on the most recent business report, the infant skincare segment accounts for roughly 57% of revenue and the POE packaging segment about 43%.
Gungjungbichaek competes domestically with players such as Agabang & Company and Happyland Corporation, and is sold through its own online store, health-and-beauty channels such as Olive Young and Watsons, and e-commerce platforms including Amazon and Tmall.
The POE business holds a monopoly position as the sole domestic manufacturer and is expanding overseas with diversified supply into ten countries including China, Hong Kong, and Malaysia.
The Gungjungbichaek business has seen improved sales as online share grows and dawn delivery and simplified payment options increase transaction volume.
More recently, Gungjungbichaek has diversified its revenue base by expanding overseas into China, Europe, Southeast Asia, the Middle East, Japan, and the United States. Both businesses are seeking growth drivers through greater overseas revenue exposure amid the structural constraint of Korea's low birth rate.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩19.5B | ₩800M | 4.1% |
| 2025Q3 | ₩16.4B | ₩400M | 2.6% |
| 2025Q4 | ₩16.9B | ₩20,897,198 | 0.1% |
| 2026Q1 | ₩16.7B | ₩600M | 3.9% |
| 2026Q2 | ₩20.7B | ₩1.8B | 8.5% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩90.4B | ₩9.3B | ₩4.1B | 10.3% | 5.2% | 24.9% |
| 2023 | ₩69.4B | ₩2.3B | ₩1B | 3.3% | 1.2% | 9.7% |
| 2024 | ₩66.9B | ₩1.5B | ₩500M | 2.3% | 0.6% | 11.5% |
| 2025 | ₩71B | ₩2.5B | ₩3.5B | 3.5% | 4.1% | 10.1% |
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
On an annual basis, revenue declined from KRW 90.39bn in 2022 to KRW 69.41bn in 2023 and KRW 66.89bn in 2024, before rebounding to KRW 70.95bn in 2025.
Over the same period, operating profit fell from KRW 9.33bn in 2022 to KRW 2.32bn in 2023 and KRW 1.53bn in 2024, then recovered to KRW 2.52bn in 2025, with the operating margin improving from 2.3% in 2024 to 3.5% in 2025.
Owners' net income dropped to KRW 0.50bn in 2024 before jumping to KRW 3.45bn in 2025; on a full-year 2025 basis, revenue rose 6.1%, operating profit rose 64.9%, and net income rose 590.0% year over year.
By quarter, Q3 2025 revenue was KRW 16.39bn with operating profit of KRW 0.42bn, while Q4 2025 revenue was KRW 16.91bn with operating profit of only KRW 0.02bn; yet Q4 net income rose sharply to KRW 1.34bn, suggesting non-operating items contributed substantially to net income that quarter.
Moving into 2026, Q1 revenue was KRW 16.69bn with operating profit of KRW 0.64bn, and Q2 revenue was KRW 20.74bn with operating profit of KRW 1.77bn, marking two consecutive quarters of operating profit expansion, with the Q2 operating margin reaching roughly 8%, the highest in the observed window.
Over the trailing four quarters (Q3 2025 through Q2 2026), cumulative revenue was approximately KRW 70.73bn and owners' net income approximately KRW 4.51bn, with revenue still below the 2022 peak level.
Overall, earnings show a gradual recovery from a 2024 trough, but the divergence between quarterly operating profit and net income warrants attention to whether one-off items are affecting the quality of reported earnings.
Korea's domestic baby products market is generally viewed as structurally constrained in volume growth due to the persistently low birth rate.
As a result, domestic infant skincare and baby product companies are increasingly focused on overseas markets—especially China and Southeast Asia, and more recently Europe, the Middle East, Japan, and the United States—leveraging K-beauty and K-heritage demand to expand exports.
Gungjungbichaek was named an outstanding new-product marketing brand at Watsons China's '2026 Brand Growth Conference' held in July, a recognition tied to the completion of its rollout to 2,600 stores that had been progressing in stages since February.
Competitively, domestic rivals in baby products and skincare include Agabang & Company and Happyland Corporation, while overseas the company competes with local brands and global K-beauty distribution platforms.
The POE packaging business retains a monopoly position domestically, facing limited local competitive pressure, but must compete with local packaging suppliers when expanding abroad.
Across the industry, raw material (resin) price fluctuations, exchange rates, and cosmetics registration regulations in various countries (such as NMPA) are cited as variables that can affect results.
Overall, the baby products industry is in a cycle marked by intensifying competition over brand strength and distribution network access amid a dual structure of stagnant domestic growth and overseas expansion.
The company continues to expand Gungjungbichaek's overseas channels, with concrete milestones in 2026 including the completed rollout to 2,600 Watsons stores in China, entry into eight European countries, and listings with pharmacy chains in the UAE and other Middle Eastern markets.
In Japan, reports indicate that Gungjungbichaek's suncare sales share has been expanding on the popularity of K-beauty sunscreens.
The POE packaging business continues a strategy of market opening and supply diversification into ten countries including China, Hong Kong, and Malaysia, which could partially offset the limits of domestic demand tied to Korea's declining birth rate.
The record operating margin in the Q2 2026 results suggests that overseas channel expansion combined with cost management is contributing to improved profitability.
However, no formal revenue or profit guidance, nor any large-scale capacity expansion or capital investment plan, has been confirmed from the company, so the continuation of this trend will need to be verified through upcoming quarterly results and disclosures related to overseas channel expansion.
Seasonally, the fourth quarter coincides with year-end promotions and peak overseas demand periods, making Gungjungbichaek's overseas revenue contribution an important item to monitor.
Viewed alongside the earnings trajectory, the period of sharply reduced net income in 2024 produced a distorted expansion in the earnings multiple, and that multiple has trended lower as net income has recovered since 2025.
The stock trades at a level below the company's book value per share, placing it in a discount range relative to net assets. On dividends, the company has a recent history of paying cash dividends, but the continuation and size of future payouts remain tied to earnings performance.
As a small-cap KOSDAQ stock with relatively limited trading volume, valuation interpretation should also account for potential price volatility. Because these figures move daily with the share price, readers should refer to the real-time values displayed on screen for the precise multiples and yield.
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
In 2026, Gungjungbichaek completed its rollout to 2,600 Watsons stores in China and has continued entering new markets, including eight European countries and pharmacy chains in the UAE. In Japan, its suncare products have shown an expanding sales share.
This simultaneous multi-region expansion can partially offset the domestic market constraints stemming from Korea's low birth rate.
Past the 2024 trough, 2025 saw improvement across revenue, operating profit, and net income, and operating profit expanded for two consecutive quarters in early 2026, with the Q2 operating margin reaching the highest level in the observed window. This can be interpreted as a result of overseas channel expansion combined with cost management.
The POE packaging business maintains a monopoly position as the sole domestic manufacturer and is diversifying its supply base into ten countries including China, Hong Kong, and Malaysia. This can serve as a relatively stable cash-flow-generating pillar compared with the skincare business.
2025 revenue of KRW 70.95bn increased year over year but remains well below the KRW 90.39bn recorded in 2022. Cumulative revenue over the trailing four quarters was also around KRW 70.73bn, similarly limited, indicating that the absolute scale of growth remains constrained.
In Q4 2025, operating profit was only KRW 0.02bn, yet net income rose sharply to KRW 1.34bn. This suggests non-operating factors may have had a significant impact on results, and future earnings should be interpreted with attention to whether one-off items are involved.
As a small-cap KOSDAQ stock, trading volume is not large, and officially confirmable revenue or profit guidance from the company is limited, narrowing the range of information available for investment judgment. This raises uncertainty in earnings forecasting.
Korea's persistently low birth rate structurally constrains the domestic volume of baby products and skincare. The company is seeking to offset this through overseas revenue growth, but the extent to which overseas growth can compensate for the pace of domestic market contraction requires ongoing monitoring.
The cosmetics business is exposed to country-specific approval procedures such as China's NMPA registration, as well as regulatory changes in newly entered regions such as Europe and the Middle East. Delays in approval or tightened regulation could affect the speed and cost of entering new markets.
The POE packaging business is exposed to fluctuations in raw material (resin) prices, and as overseas revenue share grows for both the skincare and packaging businesses, exchange rate volatility can have a greater impact. Cost and currency volatility can widen quarter-to-quarter variation in operating margin.
The Q3 2026 earnings release will show whether the operating margin improvement seen in Q2 continues, and how much Gungjungbichaek's overseas sales are contributing.
Amid year-end promotions and peak overseas demand, it is worth watching for disclosures or news on Gungjungbichaek's expansion into new countries or additional major distribution listings.
The confirmed full-year 2026 results and dividend plan disclosure will show whether the earnings recovery seen in 2025 continued on an annual basis, and whether the dividend policy is maintained.
It is necessary to continue monitoring disclosures on new export markets or supply diversification for the POE packaging business, and the impact of raw material price and exchange rate movements on packaging segment margins.
Zero to Seven has shown improvement across revenue, operating profit, and net income since a 2024 trough, with the operating margin in the first half of 2026 reaching the highest level in the observed window as the earnings recovery continues.
Growth drivers stem from two pillars: Gungjungbichaek's overseas channel expansion (China's Watsons, eight European countries, the Middle East, Southeast Asia, and Japan) and export diversification in the POE packaging business (ten countries).
However, revenue scale remains below the 2022 level, and quarters such as Q4 2025—where operating profit and net income diverged significantly—warrant caution in interpreting earnings quality.
Structural market constraints from Korea's low birth rate, along with overseas regulatory and currency volatility, remain risk factors to monitor.
On valuation, the stock trades at a discount to book value, and the earnings multiple, which had expanded during the period of weak net income, has moved lower alongside the recent earnings recovery.
Before drawing investment conclusions, it will be important to confirm the durability of this recovery through upcoming quarterly results and disclosures related to overseas channel expansion.
Report written 2026-09-05 · Data as of 2026-09-04
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