KOSDAQChemicals457370

Hanchem

₩10,990▼ 0.90%2026-10-02 close

Market Cap

₩88.3B

Turnover

₩2.7B

Volume

240,000 shares

Shares out.

8.1M

PER

16.2×

PBR

1.1×

EPS

₩488

Dividend Yield

2.53%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩200 per share · Prices as of the 2026-10-02 close

Report overview

Diversifying Beyond OLED Into MLCC Materials

Hanchem is pushing to diversify beyond its OLED emissive material-centered CDMO business into MLCC and semiconductor materials, following the startup of its new Okcheon plant, even as revenue and margins in its core business have declined recently.

1
2025 consolidated revenue was KRW 33.9 billion (down 7.6% year over year), with operating margin falling to 14.3% from 17.8% a year earlier.
2
Operating margin in the trailing four quarters (2025Q3-2026Q2) dropped into single digits starting in 2025Q4.
3
The new Okcheon plant began operations in June 2026, expanding reactor count from 40 to 53 units and total capacity to 70,200 liters.
4
The company completed expansion of its MLCC raw material production line and is expanding supply to domestic customers including Samsung Electro-Mechanics as part of new business diversification.
5
The company made its first cash dividend since listing and has announced plans to reflect quarterly dividends in its articles of incorporation as part of enhanced shareholder returns.

Business structure

Hanchem was established in 1999 and listed on KOSDAQ in October 2024 as a specialized carbon-compound advanced materials custom development and manufacturing organization (CDMO).

The company researches, develops, and produces compound materials tailored to customer requirements, leveraging more than 6,000 synthesis cases and a proprietary sample database to reduce trial and error in mass-production process development.

Its core product is OLED materials, which accounted for 74.27% of total revenue in the first quarter of 2026, while catalyst, pharmaceutical, bio, and semiconductor materials made up 25.69%.

Within OLED materials, emissive layer products carry significant weight, and the company has leveraged deuterium substitution technology accumulated since 2014 to compete in long-life materials.

However, according to disclosures made at the time of listing, roughly 90% of revenue was concentrated with two customers as of end-2023 and mid-2024, a structural concentration, with one major customer reportedly being LG Chem.

Compared with fellow OLED materials CDMO firm S-Chem, Hanchem posted first-half 2025 revenue of KRW 18.9 billion and operating profit of KRW 3.3 billion, up 4% and 6% year over year respectively, while S-Chem's revenue plunged 44% and swung to an operating loss over the same period.

More recently, Hanchem has been expanding into MLCC raw materials, next-generation semiconductor and substrate materials, and defense materials, and established a flexible multi-product production system with the startup of its new Okcheon plant in the first half of 2026.

Earnings trend

Quarterly revenue · Operating profit

₩11B₩2B25Q2₩8.2B₩1.3B25Q3₩6.8B₩200M25Q4₩6.3B₩500M26Q1₩6.7B₩400M26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩26.9B₩5B2023₩36.7B₩6.5B2024₩33.9B₩4.9B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩11B	₩2B	18.5%
2025Q3	₩8.2B	₩1.3B	15.9%
2025Q4	₩6.8B	₩200M	3.4%
2026Q1	₩6.3B	₩500M	7.3%
2026Q2	₩6.7B	₩400M	6.2%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2023	₩26.9B	₩5B	₩4.2B	18.6%	20.1%	49.3%
2024	₩36.7B	₩6.5B	₩5.8B	17.8%	10.5%	14.3%
2025	₩33.9B	₩4.9B	₩5.8B	14.3%	9.7%	10.8%

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

Hanchem's consolidated revenue grew from KRW 26.9 billion in 2023 to KRW 36.7 billion in 2024, but declined 7.6% year over year to KRW 33.9 billion in 2025.

Operating profit also fell from KRW 6.5 billion in 2024 to KRW 4.9 billion in 2025, with operating margin trending down from 18.6% in 2023 and 17.8% in 2024 to 14.3% in 2025.

Notably, net profit attributable to owners stayed nearly flat at KRW 5.77 billion in both 2024 and 2025, remaining relatively resilient despite the operating profit decline, suggesting a contribution from non-operating items.

On a quarterly basis, revenue of KRW 11.0 billion and operating profit of KRW 2.0 billion (roughly 18.5% margin) in the second quarter of 2025 fell to KRW 8.2 billion and KRW 1.3 billion (about 15.9%) in the third quarter, then dropped sharply in the fourth quarter to revenue of KRW 6.8 billion with operating profit of just KRW 0.23 billion (about 3.4%).

In the first and second quarters of 2026, revenue was KRW 6.3 billion and KRW 6.7 billion respectively, with operating profit of KRW 0.46 billion and KRW 0.41 billion, keeping operating margin in the single digits (7.3% and 6.2%).

By contrast, net profit attributable to owners in the fourth quarter of 2025 was KRW 1.41 billion, notably higher than operating profit, indicating non-operating items helped cushion net income.

Summed over the trailing four quarters (2025Q3-2026Q2), net profit attributable to owners was KRW 3.81 billion, below the full-year 2025 figure of KRW 5.77 billion.

On the balance sheet, equity rose sharply from KRW 20.7 billion in 2023 to KRW 55.1 billion in 2024 and KRW 59.3 billion in 2025, while the debt ratio fell from 49.3% in 2023 to 10.8% in 2025, reflecting improved financial stability since listing.

Operating cash flow declined from KRW 8.11 billion in 2024 to KRW 5.58 billion in 2025 but remained above net income.

Industry analysis

The global OLED emissive material market has been contracting as smartphone shipment slowdown weighs on panel utilization rates.

Market researcher UBI Research's second-quarter 2026 report lowered its full-year forecast for global OLED panel makers' emissive material purchases to $2.54 billion, a 12.8% cut from the $2.91 billion projected in the first quarter.

Chinese panel makers have been gaining share in the small and medium OLED market through aggressive pricing, while BOE has invested 63 billion yuan (roughly KRW 11 trillion) in Chengdu to expand 8.6-generation OLED production, intensifying competition with Korean makers.

On the other hand, IT-application OLED penetration is an area expected to grow following Apple's expansion of OLED into iPad and MacBook products, with market researcher Omdia previously projecting IT OLED penetration to rise from 2-3% to 14% by 2028.

Meanwhile, the MLCC (multilayer ceramic capacitor) materials market is tightening amid rising demand for high-layer, compact MLCC driven by AI data center capital expenditure and vehicle electrification and autonomous driving trends; domestically, Samsung Electro-Mechanics produces finished MLCC products while Hanchem is seeking opportunities in the localization of the materials supply chain.

Compared with fellow OLED materials CDMO firm S-Chem, which experienced a sharp revenue decline and an operating loss in the first half of 2025, Hanchem maintained relatively steady revenue amid the industry slowdown.

Outlook

Hanchem began operating its new Okcheon plant in June 2026, expanding reactors from 40 to 53 units and stating that this raised production capacity by more than 20%.

The company said this positions it to actively pursue development and mass production of pharmaceutical intermediates, semiconductor materials, and defense materials, areas that had shrunk as the company focused on meeting OLED demand.

Regarding the MLCC materials business, a company representative described 2026 as the inaugural year of full-fledged growth, targeting more than KRW 10 billion in new revenue over the next two to three years from MLCC and next-generation semiconductor and substrate material businesses.

Building on the Okcheon plant startup, the company said it would accelerate execution of its 'Vision 2030' roadmap, targeting KRW 100 billion in revenue and a 40% share from new business segments by 2030.

Its new sublimation purification business is being prepared for full-scale mass production around the end of 2026, with the company expecting a value-added uplift effect of 20-30% from this initiative.

On shareholder returns, following its first cash dividend since listing (KRW 200 per share) decided at the end of 2025, the company has committed through its value-up program to prioritizing cash dividends and reflecting quarterly dividends in its articles of incorporation.

However, until these new business revenue contributions become substantial, earnings are likely to remain sensitive to fluctuations in the existing OLED materials business.

Valuation

PER

16.2×

PBR

1.1×

ROE

6.6%

EPS

₩488

BPS

₩7,494

Dividend per share

₩200

Since its listing, Hanchem's financial structure has improved with equity growing substantially and the debt ratio falling, but its trailing four-quarter results show both revenue and profit at lower levels than the preceding full year.

Relative to net asset value, the stock trades at a level that is not heavily skewed toward either a premium or a discount, and its multiple relative to historical earnings has fluctuated within the band established since its early listing period.

Dividends have only recently begun following listing, so the track record is still short, making direct comparison with more dividend-mature peers in the sector premature. Given the recent quarterly earnings decline, how the market values the stock going forward may depend significantly on whether earnings recover.

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

Securing growth drivers through business diversification

The startup of the new Okcheon plant expanded production capacity by more than 20%, and the business is broadening into MLCC, semiconductor, defense, and pharmaceutical materials. The company has set a target of more than KRW 10 billion in new revenue within two to three years from new businesses including MLCC.

A 'Vision 2030' roadmap targeting KRW 100 billion in revenue and a 40% new-business mix by 2030 has also been presented. Entering concrete execution steps to reduce reliance on OLED alone can be viewed positively.

Technical competitiveness and low leverage

Deuterium substitution technology accumulated since 2014 and more than 6,000 synthesis cases are cited as competitive advantages in the long-life OLED materials market. Equity has grown substantially since listing while the debt ratio has fallen sharply, improving financial capacity for new investment. Operating cash flow has also continued to exceed net income, easing funding pressure.

Strengthening shareholder return policy

The company decided on its first cash dividend since listing and, through its value-up program, has committed to prioritizing cash dividends and reflecting quarterly dividends in its articles of incorporation. A treasury stock acquisition plan has also been reported.

A recently listed company formalizing shareholder return policy at an early stage can be seen as a positive signal.

Bear factors

Continued decline in revenue and margins

Consolidated revenue fell 7.6% year over year in 2025, and operating margin dropped from 17.8% to 14.3%. Operating margin has remained in the single digits from the fourth quarter of 2025 through the second quarter of 2026. Trailing four-quarter net profit has also fallen below the preceding full year's level.

Customer concentration structure

According to disclosures made at the time of listing, roughly 90% of revenue was concentrated with two customers, meaning results can be heavily influenced by changes in those customers' business conditions or procurement policies. This concentration could persist until revenue diversification becomes more substantial.

Fellow OLED materials firm S-Chem's sharp revenue decline following a change in its supply chain position illustrates a similar risk.

Early-stage nature of new businesses

New businesses such as MLCC and sublimation purification are still at an early stage where revenue contribution has not yet become substantial, and whether the targeted new revenue scale and timing will materialize as planned requires confirmation.

Fixed cost burdens from new facility investment may arise first while revenue recognition lags, potentially weighing on profitability during the transition.

Risk factors

End-market and customer dependency risk

The OLED emissive material market has seen its global purchasing forecast revised downward amid smartphone shipment slowdown, and the concentration of revenue among a small number of customers can directly transmit such industry fluctuations into results.

Aggressive pricing and large-scale investment by Chinese panel makers may also pressure the domestic value chain.

New investment execution risk

Large-scale facility investment is underway, including the new Okcheon plant and additional expansion plans, and if the revenue payback from these investments is delayed or falls short of targeted new business revenue scale, it could weigh on profitability.

The detailed execution of the mid-to-long-term expansion plan reported at approximately KRW 50 billion also requires confirmation.

Competitive and technology risk

In new areas such as MLCC and semiconductor materials, established large materials companies and Japanese firms represent strong competitors, which could make market entry and share expansion time-consuming.

In OLED materials as well, the competitiveness of the domestic value chain could be affected depending on whether the technology gap with Chinese makers narrows.

What to watch next

Mid-November 2026
The 2026 third-quarter report is expected around this time, and it will be important to check whether OLED revenue recovers and operating margin moves out of the single digits.
H2 2026 to early 2027
This is when MLCC materials revenue from the new Okcheon plant startup should begin appearing in results, warranting a check on the pace toward the company's stated new revenue targets.
Late 2026
This is the targeted timing for full-scale mass production of the sublimation purification business, requiring confirmation of whether it proceeds as planned and whether the expected value-added uplift appears in results.
Shareholder meeting and board disclosures from H2 2026
This is the point to check whether quarterly dividends are reflected in the articles of incorporation and whether the first quarterly dividend is implemented.
Upon further disclosure
It is worth checking whether the detailed schedule and investment scale of the reported KRW 50 billion mid-to-long-term expansion plan become more concrete.

Overall view

Since listing, Hanchem has improved its financial structure through equity growth and a lower debt ratio, but revenue and operating margin have shown a clear downtrend since 2025, with operating margin remaining in the single digits from the fourth quarter of 2025 through the second quarter of 2026.

Net profit has been relatively resilient due to contributions from non-operating items, but the trailing four-quarter sum of net profit is below the preceding full year's figure.

The company has presented a roadmap to diversify into MLCC, semiconductor, defense, and pharmaceutical materials following the startup of its new Okcheon plant, targeting KRW 100 billion in revenue and a 40% new-business mix by 2030.

However, revenue contribution from these new businesses remains at an early stage, and the structure of revenue concentrated among a small number of customers persists. Moves to strengthen shareholder returns, including dividend initiation and a value-up program, are confirmed but still have a short track record.

The pace at which new business revenue materializes and whether the OLED market recovers appear to be key variables that will determine future earnings trends.

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.