KOSPICosmetics192820

Cosmax

₩270,500▼ 3.05%2026-10-02 close

Market Cap

₩3.1T

Turnover

₩34.2B

Volume

130K

Shares out.

11.4M

PER

17.0×

PBR

4.8×

EPS

₩16,242

Dividend Yield

1.20%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩3,300 per share · Prices as of the 2026-10-02 close

Report overview

Record Quarter, First U.S. Profit, Remaining Variables

Order flow from K-beauty indie brands drove record quarterly revenue and operating profit and the U.S. subsidiary turned its first-ever quarterly profit, yet working-capital strain, tariffs and base effects remain.

1
Second-quarter 2026 consolidated revenue of KRW 794.9bn and operating profit of KRW 73.7bn were both quarterly records, with the operating margin back above 9% (confirmed financials).
2
Per company filings and press reports, the Korean entity topped KRW 500bn in quarterly revenue for the first time and the U.S. entity posted its first-ever quarterly operating profit.
3
Annually, the operating margin improved from 3.3% in 2022 to 8.2% in 2025, extending the earnings recovery.
4
Operating cash flow fell from KRW 231.0bn in 2023 to KRW 86.7bn in 2025, showing a gap between top-line growth and cash generation.
5
The Pyeongtaek Plant 1 expansion, the new Thai plant and the Shanghai complex make utilization and depreciation the key swing factors ahead.

Business structure

COSMAX is a cosmetics ODM specialist that handles everything from product planning and formulation to manufacturing and quality control on behalf of brands. The company says its platform strategy, spanning development, production and export support, has secured roughly 5,000 brands as customers.

On competitive positioning, Kolmar Korea is described as focusing on scale-up brands with sun-care and quasi-drug strengths, while COSMAX runs a balanced 50:50 mix of skincare and color cosmetics that covers a very wide range of indie brands.

Geographically, the Korean entity is the revenue core, supported by subsidiaries in China (Shanghai and Guangzhou), the United States, Indonesia and Thailand.

For the second quarter of 2026, disclosed and reported figures were KRW 518.4bn for Korea, KRW 197.4bn for China, KRW 53.8bn for the U.S., KRW 28.9bn for Indonesia and KRW 24.9bn for Thailand. It exports finished goods directly to 43 countries and, including indirect exports, supplies about 120 countries.

Annual capacity stands at about 3.5bn units, which the company said it plans to lift toward roughly 4bn units. More recently it built an export-import support platform for customers in response to tightening rules such as the U.S.

Modernization of Cosmetics Regulation Act, extending services beyond manufacturing into regulatory and logistics support. At group level, health-supplement ODM units and a pet health-and-beauty ODM arm complement the portfolio.

Earnings trend

Quarterly revenue · Operating profit

₩623.6B₩60.8B25Q2₩585.6B₩42.7B25Q3₩601B₩40.9B25Q4₩682B₩53B26Q1₩794.9B₩73.7B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩1.6T₩53.1B2022₩1.8T₩115.7B2023₩2.2T₩175.4B2024₩2.4T₩195.8B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩623.6B	₩60.8B	9.8%
2025Q3	₩585.6B	₩42.7B	7.3%
2025Q4	₩601B	₩40.9B	6.8%
2026Q1	₩682B	₩53B	7.8%
2026Q2	₩794.9B	₩73.7B	9.3%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩1.6T	₩53.1B	₩20.8B	3.3%	3.6%	214.3%
2023	₩1.8T	₩115.7B	₩57.1B	6.5%	15.8%	334.3%
2024	₩2.2T	₩175.4B	₩85.8B	8.1%	18.1%	280.0%
2025	₩2.4T	₩195.8B	₩123.1B	8.2%	22.0%	247.1%

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

Earnings analysis

On confirmed figures, 2025 consolidated revenue was KRW 2,398.8bn with operating profit of KRW 195.8bn, an operating margin of 8.2%. Against 2022 revenue of KRW 1,600.1bn and operating profit of KRW 53.1bn (3.3% margin), revenue is roughly 1.5 times and operating profit about 3.7 times higher over three years.

Net profit attributable to owners rose from KRW 20.8bn in 2022 to KRW 57.1bn in 2023, KRW 85.8bn in 2024 and KRW 123.1bn in 2025, and the group swung from a consolidated net loss in 2022 into sustained profitability.

Quarterly, after KRW 623.6bn revenue and KRW 60.8bn operating profit in 2Q25, margins slipped below 7% in 3Q25 (KRW 585.6bn, KRW 42.7bn) and 4Q25 (KRW 601.0bn, KRW 40.9bn), before recovering above 9% in 1Q26 (KRW 682.0bn, KRW 53.0bn) and 2Q26 (KRW 794.9bn, KRW 73.7bn).

The company said second-quarter Korean revenue was KRW 518.4bn with operating profit of KRW 56.4bn, helped by strength in skincare and improved profitability in sun care and gel masks.

In 4Q25, net profit attributable to owners of KRW 85.1bn far exceeded operating profit of KRW 40.9bn, suggesting a large non-operating contribution whose details need to be checked in the annual report.

On the other side of the ledger, operating cash flow fell from KRW 231.0bn in 2023 to KRW 73.0bn in 2024 and KRW 86.7bn in 2025, lagging profit growth and pointing to working-capital demands from inventory and receivables.

The debt-to-equity ratio eased from 334.3% in 2023 to 280.0% in 2024 and 247.1% in 2025, but remains in the mid-200% range. In short, revenue and margins are on a recovery path while cash generation and balance-sheet repair are moving more slowly than reported profit.

Industry analysis

The downstream K-beauty export market is in a record phase. Ministry of Food and Drug Safety data put first-half 2026 cosmetics exports at a preliminary USD 7.0bn, up 27.3% year on year and the highest half-year total on record. Second-quarter exports of USD 3.9bn were 25.8% above the first quarter's USD 3.1bn.

Growth is led by smaller indie brands: the Ministry of SMEs and Startups reported first-half SME cosmetics exports of USD 5.07bn, up 30.7%.

Small and indie brands now account for more than 70% of Korea's cosmetics exports, with short-form video platforms and global e-commerce enabling direct overseas access for small players.

As more brands operate without factories, volumes concentrate on the top ODM players, and in the second quarter COSMAX passed KRW 500bn in quarterly revenue at its Korean entity for the first time while Kolmar Korea topped KRW 100bn in quarterly operating profit, with peers also setting records.

On cycle risk, a 15% U.S. tariff on Korean-made goods is charged before retail margins, forcing pricing structures to be recalculated, and how much of the tariff Korean cosmetics can absorb through price and formulation competitiveness is cited as the swing factor for second-half results.

Shorter trend cycles in the indie ecosystem and the resulting build-up of inventory and receivables are also flagged as new challenges for COSMAX as a manufacturing platform.

Outlook

Management's stated direction is continued growth on skincare strength, expanding global demand and the ramp-up of new customers. COSMAX said it would consolidate its position as the top cosmetics ODM in the second half based on skincare strength, growing global K-beauty demand and newly onboarded customers.

On the supply side, expansion projects are clustered. A May 2026 filing approved KRW 60.5bn (9.9% of equity) for building extensions in the Pyeongtaek Goryeom industrial complex, with an investment period stated from June 1 to October 31.

The new Thai plant in Bangphli, built with about KRW 56.0bn and roughly four times the size of the previous facility, is slated to start operating in September 2026, which the company expects to lift annual output capability to about 3.6bn units.

In Shanghai's Xinzhuang district, a new headquarters and production complex costing about KRW 130.0bn is under construction; on completion the company says China output capability rises to roughly 1.6bn units.

After becoming the first Korean cosmetics ODM to win a USD 200m export award last year, the company has set a USD 300m export target for this year.

On the analyst side, an NH Investment & Securities researcher said in an August 12, 2026 report that third-quarter expectations remain valid given sustained July-August export growth, easing margin pressure at the parent entity and rapid growth in China and the United States.

Conversely, depreciation from new capacity, early-stage utilization rates, tariffs and currency remain the offsetting forces on margins.

Valuation

PER

17.0×

PBR

4.8×

ROE

34.0%

EPS

₩16,242

BPS

₩56,989

Dividend per share

₩3,300

The price-to-earnings multiple based on the last four quarters of profit sits within the band in which this stock has historically traded, while the price-to-book level implies a multiple-times premium to net assets.

Because book value per share differs between our own calculation and the figure published by the Korea Exchange, judgments about the price-to-book level depend on which basis is used.

For sector context, Shinhan Securities said in a May 2026 industry report that cosmetics companies were trading below 20 times 2026 estimated earnings, the lowest sector multiple level in ten years.

Target prices were raised right after second-quarter results: NH Investment & Securities said on August 12, 2026 that it lifted its target from KRW 260,000 to KRW 300,000, and Hana Securities moved from KRW 240,000 to KRW 305,000, Shinhan Securities from KRW 240,000 to KRW 280,000 and Hanwha Investment & Securities from KRW 250,000 to KRW 270,000 on the same day - all of these are those firms' views, not KOSAI's.

The company continues to pay a cash dividend, but the yield is low as is typical for a company in a growth phase, so the analytical weight sits with earnings momentum and expansion execution rather than payout.

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

Bull factors

Manufacturing Infrastructure For The Indie Ecosystem

With a surge in indie brands that own no factories, the one-stop platform covering planning, formulation, production, regulatory response and export has been identified as a core growth driver. A customer base counted in the thousands means a fading trend at one brand can be replaced by orders from newly emerging ones.

The company added an export-import support platform for customers, widening its scope into regulatory and logistics assistance. More touchpoints beyond manufacturing can slow customer attrition.

A Shift In Overseas Subsidiary Economics

In the second quarter of 2026 U.S. revenue rose 79% year on year to KRW 53.8bn and the entity posted its first-ever quarterly operating profit. The company attributed this to years of fixed-cost reduction, a wider sales network targeting West Coast indie brands and steady reorders from large existing clients.

China revenue also grew 33% to KRW 197.4bn. A Hanwha Investment & Securities analyst said of the U.S. turnaround that "after a long restructuring, manufacturing competitiveness is starting to show up in results."

Capacity Expansion And Room For Scale Economics

Annual capacity of about 3.5bn units is the largest in the industry, and the company said it plans to lift this toward 4bn units as new global plants start up. The new Thai plant, roughly four times the size of the old one, is scheduled to begin operating in September 2026.

Management outlined regional specialization: R&D-led differentiation for indie brands in China, Southeast Asian demand coverage from Thailand and halal-based mass production in Indonesia. If volumes fill the added lines, fixed-cost absorption leaves room for operating margin improvement.

Bear factors

Gap Between Profit And Cash Flow

On confirmed figures, 2025 operating profit was KRW 195.8bn but operating cash flow was only KRW 86.7bn, sharply lower than KRW 231.0bn in 2023. When revenue expands quickly and inventory and receivables rise alongside, the gap between profit and cash widens.

Shorter trend cycles in the indie ecosystem and the resulting increases in inventory and receivables have been flagged as tasks for COSMAX as it grows into a manufacturing platform. The debt-to-equity ratio fell to 247.1% in 2025 but remains high in absolute terms.

Margin Volatility And Product Mix

The quarterly operating margin was above 9% in 2Q25, slipped below 7% in the third and fourth quarters, then recovered above 9% in 2Q26. In other words, higher revenue did not automatically translate into higher margins.

SK Securities noted in a May 2026 report that a smaller share of color cosmetics production had weighed on Korean-entity profitability, and that Korean-entity operating profit growth turned negative in the third quarter of 2025. With expansion under way, depreciation and early-stage utilization become additional margin variables.

Tariffs And Export Base Effects

A 15% U.S. tariff applies to Korean-made goods, and that cost is incurred ahead of retail margins and marketing contributions. With the U.S. share above 20%, tariffs have been described as the biggest variable for growth.

One view holds that if trade policy tightens once more, the first-half export record could stand as a cycle peak. The higher the 2026 export growth rate, the heavier the base effect the following year.

Risk factors

Demand And Customer Structure

Because revenue leans heavily on indie brand orders, shorter trend cycles can abruptly halt reorders for specific items. Shortening trend cycles and rising inventory and receivables are already discussed as company-level challenges.

Even with many brands, if hit categories cluster in particular formulations, utilization can diverge sharply by line. An increase in customer credit problems could also feed through to bad-debt charges.

Balance Sheet And Capex Burden

The debt-to-equity ratio moved from 214.3% in 2022 to 334.3% in 2023, 280.0% in 2024 and 247.1% in 2025, still high in absolute terms. Expansion spending is layered on top. The Pyeongtaek plant extension was disclosed at KRW 60.5bn, or 9.9% of equity. The Shanghai complex involves about KRW 130.0bn.

With operating cash flow lagging profit growth, investors should monitor whether concentrated investment raises reliance on borrowings again.

Regulation, Trade And Currency

Rising demand for export support as country-level rules such as the U.S. Modernization of Cosmetics Regulation Act tighten can also be read as a signal of growing compliance costs. Commentators warn that a safety or quality controversy at one brand could spill over into trust in K-beauty as a whole.

Projections that extend first-half export momentum across the full year rest on tariffs and exchange rates staying near current levels. Given the weight of overseas subsidiaries, won exchange-rate swings cut both ways for consolidated results and translation gains or losses.

What to watch next

September 2026
Check whether the new Bangphli plant in Thailand, scheduled to start operating in September 2026, actually begins production and how its initial lines are configured. This anchors when Southeast Asian volumes start showing up in fourth-quarter results.
Late October 2026
Watch for completion or amendment filings around the stated end of the investment period for the Pyeongtaek Goryeom plant extension on October 31. It indicates whether the domestic capacity addition proceeded on plan and whether costs changed.
November 2026
In the third-quarter disclosure, check whether the Korean entity's margin recovery holds, whether the U.S. entity stays profitable and how fast China grows. Margins fell below 7% in the third and fourth quarters of 2025, so seasonality deserves scrutiny.
Early each month (Korea Customs Service and MFDS data)
Track whether monthly cosmetics export growth is decelerating. Hana Securities projected in an August 2026 report that Korean cosmetics exports would grow about 33% this year, and whether monthly data holds that trajectory serves as a leading signal for ODM order flow.
February 2027
With the full-year 2026 disclosure, review operating cash flow, changes in inventory and receivables and the debt ratio alongside revenue and margins. The key question is whether the gap between profit growth and cash generation seen in 2025 persists.

Overall view

COSMAX is an ODM that converts the global spread of K-beauty indie brands into manufacturing volume, and its operating margin has recovered from 3.3% in 2022 to 8.2% in 2025.

In the second quarter of 2026 it posted record revenue of KRW 794.9bn and operating profit of KRW 73.7bn, while the Korean entity passed KRW 500bn in quarterly revenue for the first time and the U.S. entity delivered its first-ever quarterly operating profit.

The bull case rests on a customer base numbering in the thousands, improving overseas subsidiary economics and capacity additions in Thailand, Pyeongtaek and Shanghai.

The bear case rests on operating cash flow that has lagged profit growth (KRW 86.7bn in 2025), a debt-to-equity ratio in the mid-200% range, the 15% U.S. tariff on Korean-made goods and a high export base.

Several brokerages raised target prices right after the results, but those are their own views; what needs verification is third-quarter margin durability, new plant start-up timing and the direction of monthly export data.

Valuation carries a premium to net assets and the assessment shifts with the basis used for book value per share, so earnings durability and cash conversion deserve equal attention alongside the multiples. This report is for information purposes only and contains no buy or sell recommendation.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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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.