One of the more overlooked industries in South Korea is its pharmaceutical industry. But this shouldn’t be the case, especially given the size and growth prospects of the South Korean drug industry.

The South Korean pharma market is one of the largest in Asia, estimated to be worth US$18.6 billion in 2013. It’s projected to exceed US$24 billion by 2020. Global economic uncertainty hasn’t affected this sector much because of an aging global population and the simple fact that the world needs healthcare.

Due to greater prevalence of disease, the for long-term care, and a higher population density, the Korean government has stepped in to ensure the healthy growth of its pharma industry. Authorities have worked to make a transparent and efficient system for faster approval of drugs and medical devices.

In the forefront of this industry, InvestAsian is proud to present Samjin Pharmaceutical (KRX:005500) to be considered for your investment.

 

Samjin: One of Korea’s Oldest Drug Companies

Established in the early 1970’s, Samjin stock has been through many hard times. But they’ve only made the company stronger.

Samjin provides all that it can to help extend the healthy life of its population. The company aims to “striving for a better future on the basis of human dignity.” It has a great deal of research and development aimed at making advances in the field of medical equipment.

The firm is involved in the research, development, manufacturing, and selling of drugs and medical devices to hospitals and stores. Samjin does business both overseas and domestically and has many patented drugs.

 

 

Strong Fundamentals and an Impressive Track Record

A company would not be able to survive through thick and thin without having very strong fundamentals. Samjin will have no problems paying back debt with a current ratio of over 2. It’s seen a constant increase in its sales, EPS, and dividends paid for the past 5 years.

Samjin is one of few companies in the market expecting a rise in both their net profit and net profit margins. Projecting a margin of 13% from its previous 10%, Samjin stock should have an even better time in today’s economy.

Its performance can also be seen in the returns that it makes for investors. Coming in on top of all the competition, Samjin boasts an impressive ROI of 15%, ROE of 17%, and an ROA of 10%- not bad for the pharmaceutical sector. It has a P/E ratio of 13.44 and a dividend yield of 2.39%.

Selling at a steep discount to last year, InvestAsian rates Samjin stock a buy.

Want to invest in Korean stocks? You might also want to look at our analysis of Leeno Industrial and Guemhwa. Both of these companies are highly undervalued.

About Reid Kirchenbauer

Reid Kirchenbauer is the Founder of InvestAsian. He's experienced with trading stocks and buying property in Thailand, Cambodia, and elsewhere. He's been featured in publications such as Forbes, Nomad Capitalist, Property Report, and Seeking Alpha. Download his free investment guide by clicking here.

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