[Edaily Marketin Reporter LEE GEON-EOM ] Korea Ratings Corporation (KRC) announced on the 25th that it has assigned a new credit rating of “A2+” to the commercial paper of HANILCEMENT(300720). KRC currently assigns a credit rating of “A+ (Stable)” to HANILCEMENT’s unsecured bonds. Despite a decline in sales due to the prolonged slump in the construction sector, the company received a positive evaluation for its stable business foundation in the cement and related sectors, as well as its robust profit-generating capacity achieved through cost reductions.

Established through a spin-off of the building materials division of HANILHOLDINGS (formerly HANILCEMENT), Hanil Cement has firmly maintained its position as the industry’s second-largest player in terms of production capacity and domestic market share as of 2024. In particular, analysts note that by operating both the ready-mix concrete division—used in the early and mid-stages of construction—and the Remital division—used in the later stages—the company has established a diversified business portfolio even amid high economic volatility in the Chonbang industry.

The fact that the company consumes a large portion of its own cement production as raw materials—such as ready-mix concrete, Remital, and slag cement—is another factor that further enhances business stability.

Kang Seong-mo, an analyst at Hanshin Rating, noted, “As the construction slump persisted into 2025, cement sales volume fell by approximately 10% year-over-year, and revenue from the Remital segment—which accounts for a high proportion of materials used in the later stages of construction—also declined significantly, causing consolidated revenue to shrink from 1.7 trillion won in 2024 to 1.4 trillion won in 2025.” However, “However, thanks to the decline in the price of bituminous coal—the company’s primary fuel—and the cumulative effect of price increases for key products, the company recorded a healthy operating profit margin of around 10%.”

In fact, while HANILCEMENT’s company-wide operating profit decreased year-over-year due to shrinking demand for major products and the reflection of some non-recurring losses in other businesses, the company succeeded in maintaining improved sales margins compared to the past, thanks to the oligopolistic market structure characteristic of the cement and dry mortar (Remital) industries, its diversified business structure, and the results of investments in environmental facilities.

In terms of financial structure, consolidated net debt increased slightly to 4473억 won as of the end of March 2026, due to environmental facility investments and dividend payment burdens since 2022. However, based on its strong operating cash generation, the company has been able to adequately meet the funding needs for capital expenditures and dividends, maintaining a stable “net debt/EBITDA” ratio on a consolidated basis at around 2.

Analyst Kang predicted, “As major environmental facility investments are completed in phases from the second half of 2024 through 2026, capital requirements related to capital expenditures are expected to decrease significantly starting in 2027.” He added, “Based on the robust cash generation of its core businesses and the results of environmental facility investments, the company will be able to cover a significant portion of its future capital needs internally and manage its financial burden appropriately.”