[Edaily Reporter Kwon Oh Seok ] IBK Investment & Securities announced on the 2nd that it is initiating coverage of DongKook Pharmaceutical Co.,Ltd.(086450)with a “Buy” rating and a target price of 30,000 won.

Lee Su-joo, an analyst at IBK Investment & Securities, stated, “It is a traditional pharmaceutical company that has secured stable sales through over-the-counter (OTC) drugs such as Madecassol and Insadol, as well as prescription drugs (ETC) centered on generics.” She added, “However, the business that has driven growth over the past three years is cosmetics. Madecream, a skin-soothing and moisturizing product utilizing the centella asiatica extract found in Madecassol, has established itself in the domestic market with cumulative sales exceeding 100 million units, and the share of healthcare revenue—including cosmetics—is projected to expand from 31.9% in 2023 to 39.3% in 2026.”
He continued, “With healthcare revenue in the first half of 2026 projected to reach 202.9 billion won—a 28.7% year-over-year increase—the key to future growth lies in overseas markets,” explaining, “As overseas sales channels expand this year through entry into major retail networks such as Ulta and Costco in the U.S. and Don Quijote in Japan, the cosmetics business is broadening its growth base from the domestic market to international markets.”
Consolidated revenue for the second half of 2026 is projected to reach 547.5 billion won (+16.6% year-over-year), with operating profit at 60.1 billion won (+22.5%). Driven by growth in the cosmetics segment, the growth rates for revenue and operating profit are expected to exceed the first half’s figures of 11.5% and 12.6%, respectively.
Analyst Jeong emphasized, “Driven by the effects of the expanded distribution networks in the U.S. and Japan during the first half, combined with demand from the year-end holiday shopping season in the fourth quarter, second-half healthcare revenue is expected to increase to 213.2 billion won (+34.3%).” He added, “As revenue expands, the burden of fixed costs will decrease, and we expect the operating profit margin to rise to 10.7% in the third quarter and 11.3% in the fourth quarter.”
He continued, “Considering the stability of the pharmaceutical business and the growth potential of the cosmetics-focused healthcare segment, we have factored in the multiples of both pharmaceutical (9.8x) and cosmetics (20.5x) peers,” adding, “Going forward, the expansion of overseas healthcare sales and improved profitability are expected to drive a revaluation of the stock price.”