PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩10,100 per share · Prices as of the 2026-10-02 close
As the world's largest spandex producer, Hyosung TNC saw earnings power recover clearly in the first half of 2026, yet off-season pricing and the payoff from its specialty-gas and bio-materials ventures still need to be verified.
In 2Q26, consolidated revenue reached KRW 2.416tn with operating profit of KRW 188.8bn and owners' net profit of KRW 95.5bn, lifting the quarterly operating margin to 7.8%.
After a KRW 30.0bn owners' net loss in 4Q25, profitability stepped up sharply within two quarters, and first-half 2026 owners' net profit roughly matches the full-year 2024 figure.
Textiles (spandex and PTMG) remain the profit engine, with the textile segment's 2Q26 operating margin reported at around 17.0%.
Following the KRW 920bn specialty-gas acquisition (Hyosung Neochem), the debt-to-equity ratio rose from 159.6% in 2024 to 193.3% in 2025, increasing balance-sheet burden.
The company said its 50,000-tonne bio-BDO plant in Vietnam began commercial operation in early September 2026, though its actual earnings contribution is yet to be confirmed.
Hyosung TNC was spun off in 2018 during Hyosung Group's holding-company restructuring and holds the world's top market share in spandex.
Its business splits broadly into textiles (spandex and its raw material PTMG, plus nylon and polyester yarns) and trading/other operations (composite trading including steel); the Korea Economic Daily reported in a May 2026 analysis that spandex and PTMG account for roughly 40% of revenue and about 70% of operating profit.
Consistent with that, in 2Q26 the textile segment posted KRW 165.2bn in operating profit versus KRW 23.6bn for trading and other operations (Korea Economic Daily, Aug 3, 2026).
Key brands include the functional spandex line Creora and the recycled fiber line regen, supplied by end use across sportswear, swimwear, denim and diaper applications.
Production is spread across Korea (Gumi), China (Jiaxing, Zhuhai, Quzhou, Ningxia), Vietnam (Dong Nai), India, Turkey and Brazil, allowing region-specific responses to demand, tariffs and logistics.
In 2025 the company acquired Hyosung Chemical's specialty-gas business for KRW 920bn and launched the subsidiary Hyosung Neochem, saying that combined with its Quzhou facility it secured NF3 capacity of 11,500 tonnes per year.
Hyosung Neochem's main customers are reported to include semiconductor makers Samsung Electronics and SK Hynix and display makers LG Display and Samsung Display, adding semiconductor materials to the legacy textile and trading mix.
On competition, China's spandex market has been reported as an oligopoly in which the top five players, Hwafeng Chemical, Hyosung TNC, Huahai, Xinxiang and Yantai, hold about 80% of capacity, while Lycra, with a 6-7% share, influences the landscape through supply relationships with brands such as Lululemon and Nike.
As a result, earnings are increasingly determined by spandex prices and raw-material spreads together with the performance of the newly added specialty-gas and bio-materials operations.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩1.9T | ₩73.3B | 3.9% |
| 2025Q3 | ₩2T | ₩56.1B | 2.8% |
| 2025Q4 | ₩1.8T | ₩44.7B | 2.4% |
| 2026Q1 | ₩2.1T | ₩86.2B | 4.1% |
| 2026Q2 | ₩2.4T | ₩188.8B | 7.8% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩8.9T | ₩123.6B | ₩11.6B | 1.4% | 0.9% | 185.0% |
| 2023 | ₩7.5T | ₩213.4B | ₩93.2B | 2.8% | 7.3% | 159.5% |
| 2024 | ₩7.8T | ₩270.7B | ₩134.5B | 3.5% | 9.2% | 159.6% |
| 2025 | ₩7.7T | ₩251.5B | ₩10.8B | 3.3% | 0.7% | 193.3% |
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
On an annual basis, revenue fell from KRW 8.883tn in 2022 to KRW 7.527tn in 2023 and then plateaued at KRW 7.776tn in 2024 and KRW 7.695tn in 2025, while the operating margin recovered off its trough, moving from 1.4% in 2022 to 2.8% in 2023, 3.5% in 2024 and 3.3% in 2025.
Owners' net profit in 2025, however, dropped sharply to KRW 10.8bn from KRW 134.5bn in 2024; since operating profit of KRW 251.5bn was not far below the prior year's KRW 270.7bn, non-operating costs and the share attributable to non-controlling interests clearly weighed.
Of the KRW 38.2bn consolidated net profit in 2025, only KRW 10.8bn was attributable to owners, and with non-controlling equity at KRW 392.0bn, the subsidiary ownership structure has a meaningful effect on owner-level results. The quarterly path is more clearly divided.
Operating profit slid from KRW 73.3bn in 2Q25 to KRW 56.1bn in 3Q25 and KRW 44.7bn in 4Q25, when a KRW 30.0bn owners' net loss was recorded, before improving materially to KRW 86.2bn in 1Q26 and KRW 188.8bn in 2Q26.
Revenue of KRW 2.416tn in 2Q26 was the largest among the reported quarters, and owners' net profit of KRW 95.5bn with a 7.8% operating margin were also the strongest in the recent sequence.
First-half 2026 owners' net profit of KRW 134.5bn is essentially level with full-year 2024, showing that profit recovered faster than the top line.
Reported drivers included higher spandex selling prices and volumes, alongside nylon and polyester swinging back into the black as raw-material price moves fed through with a lag (Korea Economic Daily, Aug 3, 2026).
On the balance sheet, operating cash flow remained solidly positive at KRW 602.0bn in 2023, KRW 654.9bn in 2024 and KRW 456.1bn in 2025, but funding needs for the specialty-gas acquisition pushed the debt-to-equity ratio from 159.6% in 2024 to 193.3% in 2025.
In short, core earnings power is recovering, while the absolute level of profit and the pace of balance-sheet repair still need to be verified together.
Spandex production is centered on China, where annual capacity has been reported at roughly 1.5m tonnes with the top five producers holding about 80% of the total, an oligopolistic structure.
After the 2021-22 boom triggered aggressive Chinese expansion, 2023-25 brought oversupply and compressed spreads; for 2026, however, essentially no new capacity is expected, and although about 125,000 tonnes are slated for 2027, demand growth of around 8% per year is projected to lift utilization from 77.5% in 2026 to 78.6% in 2027 (NH Investment & Securities, Aug 3, 2026).
On industry indicators, Shinhan Securities said that as of April 2026 Chinese spandex utilization had risen to 86%, inventory days had fallen to 22, and prices had improved to CNY 29,000 per tonne.
Chinese market prices have edged lower since July, while the company has reportedly held its own selling prices on the back of its global leadership position (NH Investment & Securities, Aug 3, 2026).
Within chemicals, commentary has highlighted a divergence in which commodity building blocks such as ethylene remain margin-challenged while spandex supply-demand stays relatively firm amid limited expansion (Shinhan Securities, June 2026).
Competitive variables include the pricing stance of the largest producer Hwafeng Chemical, potential restructuring among later-entrant Chinese suppliers such as Huahai, and Lycra's financial condition.
Downstream apparel and fabric inventories have repeatedly been described as low, but order intensity can still swing with global consumption and seasonality.
The company said that in early September 2026 it completed and began commercial operation of a 50,000-tonne-per-year bio-BDO plant at the Phu My industrial complex in Ba Ria-Vung Tau, Vietnam.
It said the plant applies sugarcane fermentation technology secured through a partnership with US-based Geno, delivers roughly 90% carbon avoidance versus conventional fossil-based BDO, and has infrastructure that can be expanded to 200,000 tonnes per year as the market grows.
Management emphasized that the chain now runs from bio-BDO in Ba Ria-Vung Tau to PTMG and spandex in Dong Nai, feeding volume production of Creora Bio and regen Bio.
In specialty gases, the disclosed medium-term plan is to add about 2,000 tonnes of NF3 capacity at Hyosung Neochem to reach roughly 13,500 tonnes and to broaden the high-margin product lineup from six to fifteen items, reducing dependence on NF3 revenue.
That said, reporting indicated Hyosung Neochem swung to a loss on a cumulative basis through the third quarter of 2025, and NF3 price volatility remains a feature of the business. Brokerage views differ.
NH Investment & Securities said in an Aug 3, 2026 report that it expects firm spandex supply-demand to continue into 2027 and raised its target price from KRW 430,000 to KRW 470,000, while Shinhan Securities said on Apr 27, 2026 that it lifted its target price from KRW 600,000 to KRW 850,000 to reflect a full-fledged upcycle.
Conversely, NH Investment & Securities said in a June 2026 report that it cut its 2026 operating profit estimate by 10.6% to reflect the seasonal off-peak period and softer raw-material prices, leaving the second-half price path as the key source of forecast dispersion.
At the group level, IB Tomato reported on Aug 13, 2026 that Hyosung is internally reviewing a value-up plan including its first medium-term dividend guideline, with the company stating that the timeline and specific criteria have not been finalized.
The share price currently sits below reported book value per share, placing it at a discount to net assets.
Earnings-based multiples are computed on owners' net profit over the most recent four quarters, a window that mixes the 4Q25 net loss with the rapid first-half 2026 recovery, so the multiple itself carries high variability.
A dividend was paid for fiscal 2025 and the resulting yield is not far from the broader market level, but the company has not formalized a quantified return framework such as a payout-ratio target or a treasury-share policy.
For context, it was reported in August 2026 that Hyosung Group is reviewing its first medium-term dividend guideline, an issue linked to the predictability of subsidiary return policies.
The central valuation debate is whether the high textile margins of first-half 2026 represent a near-peak, temporary level or a new baseline sustained by the current gap in capacity additions.
Both Shinhan Securities and NH Investment & Securities said in 2026 reports that they raised target prices on improving spandex supply-demand, while a report published in the same year cut earnings estimates to reflect lower second-half prices, a contrast worth weighing 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
Reports project essentially no new spandex capacity in 2026, with 2027 additions unlikely to lower utilization once demand growth is factored in (NH Investment & Securities, Aug 3, 2026). Chinese utilization and inventory-day indicators have also been reported as improved versus end-2025.
With supply-side variables limited, the downside for prices and spreads can be shallower, which is the starting point of the bullish case.
The textile segment posted operating profit of KRW 165.2bn in 2Q26 with a segment margin reported at around 17.0%, while the company-wide margin rose to 7.8%.
Analysts have repeatedly argued that when spandex prices rise faster than raw materials, the leader's pricing power and cost structure translate directly into margin expansion. Nylon and polyester returning to profit has also been cited as broadening the textile segment's earnings contribution.
The company said its 50,000-tonne bio-BDO plant in Vietnam entered commercial operation in early September 2026, completing an integrated chain from feedstock through spandex.
Specialty-gas subsidiary Hyosung Neochem has disclosed plans to widen its lineup from six to fifteen products on a base of semiconductor and display customers. Whether earnings can become less dependent on a single textile cycle is the point to verify.
NH Investment & Securities said in a June 2026 report that it lowered its 2026 operating profit estimate by 10.6% to reflect the seasonal off-peak period and softer raw-material prices. Chinese spandex market prices were also reported to have edged lower since July. Views differ across the sell side on whether the high 2Q26 margin can be sustained.
The debt-to-equity ratio rose from 159.6% in 2024 to 193.3% in 2025, and total liabilities increased from KRW 2.904tn to KRW 3.782tn over the same period. This reflects funding needs for the KRW 920bn specialty-gas transfer, and acquisition financing has been flagged as a burden on the capital structure. Interest-rate and currency swings remain a source of non-operating earnings volatility.
Reporting indicated Hyosung Neochem swung to a cumulative loss through the third quarter of 2025, with the company explaining that NF3 demand recovery was gradual as chipmakers focused on process migration rather than wafer output.
Bio-BDO has only just entered commercial operation, so actual sales and margins are not yet verified. If cash returns lag the scale of investment, depreciation and financing costs can erode profit.
Spandex prices and spreads swing widely with China-centered supply and the apparel demand cycle. The gap between a 1.4% operating margin in 2022 and 7.8% in 2Q26 illustrates that volatility. Restarted Chinese expansion, reversal of production cuts, or reduced brand orders could unwind margins quickly.
Financial leverage has risen, with a 193.3% debt-to-equity ratio and total liabilities of KRW 3.782tn at end-2025. As shown by 2025 consolidated net profit of KRW 38.2bn of which only KRW 10.8bn accrued to owners, the non-controlling interest structure can reduce the portion reflected at the owner level.
The market has also flagged that affiliate financial conditions and group cash flows could influence company decisions.
A production footprint across Korea, China, Vietnam, India, Turkey and Brazil offers flexibility but also exposure to currencies, tariffs and freight costs. Tighter carbon and environmental rules in Europe and the US are both an opportunity for eco-friendly products and a source of certification and capex costs.
The semiconductor materials arm is sensitive to major customers' investment plans and changes in export controls.
Third-quarter 2026 results. Whether the textile segment margin stays near the second-quarter level reported around 17% despite the seasonal off-peak, and whether the company-wide margin holds in the 7% range, will indicate the durability of the new profit level.
Chinese spandex prices, utilization and inventory days on a monthly basis. Watch whether market prices that softened after July stabilize, and whether the company's stated ability to hold selling prices as market leader shows up in quarterly margins.
Utilization and sales from the 50,000-tonne bio-BDO facility in Vietnam. With commercial operation announced, the first real evidence for the new business will be its revenue and margin contribution and any decision on expansion toward 200,000 tonnes per year.
Full-year 2026 results, the dividend decision, and any group value-up disclosure. Since it was reported in August 2026 that Hyosung is reviewing its first medium-term dividend guideline, the specificity of any payout-ratio target or treasury-share policy will determine the predictability of shareholder returns.
Actual progress on the roughly 125,000 tonnes of spandex capacity slated for 2027, plus Hyosung Neochem's specialty-gas expansion and profitability. Earlier-than-expected additions would weaken the supply-demand improvement thesis, while a return to profit in specialty gases would diversify the earnings mix.
Hyosung TNC, the world's largest spandex producer, showed a clear recovery in earnings power in 2Q26 with revenue of KRW 2.416tn, operating profit of KRW 188.8bn and owners' net profit of KRW 95.5bn.
It rebounded within two quarters from a KRW 30.0bn owners' net loss in 4Q25, and first-half 2026 owners' net profit is essentially level with the full-year 2024 figure.
The recovery reflects better spandex prices and volumes alongside nylon and polyester returning to profit, with many analyses pointing to China's capacity gap and low downstream inventories as support for the supply-demand thesis.
On the other hand, a report published in the same year cut earnings estimates on the seasonal off-peak period and softer raw materials, and Chinese market prices were reported to have edged down since July.
Financially, the debt-to-equity ratio rose from 159.6% in 2024 to 193.3% in 2025 after the KRW 920bn specialty-gas acquisition, while Hyosung Neochem's profitability and bio-BDO sales in Vietnam remain to be proven.
The debate ahead therefore centers on three axes: the durability of the spandex cycle, the earnings contribution from new businesses, and the pace of balance-sheet repair. This report is for information purposes only and does not constitute investment advice or a buy or sell opinion.
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.