Blog

DEEP RESEARCH · DONGJIN SEMICHEM

Dongjin Semichem: The Start of a New Era — Catalysts for Growth and Re-rating

A re-rating scenario driven by inheritance tax, the foaming-agent split-off, EUV photoresist, and CNT conductive additives

Published: 2025-10-01 · Semiconductor and battery materials company analysis · Naver Blog

Investment decisions are your own responsibility. This material is research and is not a recommendation to buy or sell.

0. Bottom line first

Dongjin Semichem is at an inflection point where governance, business structure, and technology portfolio are changing at the same time. The roughly KRW 400bn inheritance-tax burden creates a forced incentive for shareholder value, the foaming-agent split clarifies the company as an electronic-materials specialist, and EUV photoresist plus CNT conductive additives can become future growth engines.

Dongjin Semichem re-rating catalystsNon-operating events and technology commercialization point in the same direction
GovernanceAbout KRW 399.9bn inheritance tax
StrategyFoaming-agent business split
SemiconductorEUV photoresist
BatteryCNT additive and Northvolt
The question is whether the market sees a high-growth electronic and battery materials company instead of a conservative materials company.

1. Generational transition: inheritance tax as a shareholder-value incentive

Official fact: The source says founder Lee Boo-sup’s death in February 2025 opened a succession phase. His sons Lee Jun-kyu and Lee Jun-hyuk are expected to inherit 55.7% of unlisted holding company Dongjin Holdings, which owns 35.2% of listed Dongjin Semichem.

Official fact: Based on Shinyoung Securities’ analysis, Dongjin Holdings is valued at about KRW 1.2tn and expected inheritance tax is about KRW 399.9bn. The tax is to be paid over 10 years, and the source mentions roughly KRW 80bn per year in principal and interest burden.

Interpretation: This burden is not only a risk. It is an external force pushing share price, dividends, IR, and business restructuring in a shareholder-friendlier direction, because a higher share price reduces dilution when raising funds through collateral, sale, or dividends.

2. Foaming-agent split-off: clearer electronic-materials identity

Official fact: On October 1, 2025, Dongjin Semichem disclosed a physical split-off of its legacy foaming-agent business into a wholly owned subsidiary tentatively named Dongjin Inochem. The new company’s assets are about KRW 210.9bn, and the official purpose is strengthening competitiveness and focusing capability by specialized business area.

The foaming-agent business, under the UNICELL brand, was historically a global No. 1 share business for Dongjin, but it now represents less than 10% of sales. The source reads the split as both succession clarification and a move toward becoming a pure electronic-materials company.

Before

Electronic materials plus foaming agents

Legacy and growth businesses were mixed, which could blur valuation identity.

After

Pure electronic materials

The continuing company is clearer as a semiconductor, display, and battery materials company.

Succession

Role separation

Business separation is interpreted as reducing succession uncertainty.

3. Core business and moat: customer-embedded materials

  • Dongjin’s key advantage comes from deep co-development relationships with customers such as Samsung Electronics and SK hynix.
  • Materials like EUV photoresist cannot be developed by the supplier alone; they need years of testing and validation on customer production lines.
  • This creates high switching costs because chipmakers do not easily risk disruption on multi-billion-dollar lines.
  • Dongjin has an R&D history including becoming the fourth company globally to develop photoresist in 1989 and commercializing multiple core materials domestically.

4. EUV photoresist: entering a Japan-dominated market

Official fact: The source describes EUV lithography as essential for sub-7nm semiconductor production. It says the EUV photoresist market is expected to grow more than 25% annually and reach USD 1.1bn by 2030.

Official fact: Dongjin developed EUV photoresist as the first Korean company at the end of 2022 and supplied Samsung Electronics’ mass-production line. In 2023, it began mass supply of both negative and positive EUV PR for Samsung’s 14nm-class D1a DRAM process.

Interpretation: EUV PR commercialization upgrades Dongjin from a legacy-materials leader such as KrF into a cutting-edge semiconductor materials supplier. Samsung’s supply-chain diversification and accumulated production data could open expansion to other customers such as SK hynix.

5. CNT conductive additives: a second battery-materials growth axis

Official fact: Dongjin entered secondary-battery materials and focuses on carbon nanotube (CNT) conductive additives. The source describes CNT additives as key to improving EV battery energy density and charging speed.

Official fact: Dongjin signed a 10-year supply contract with European battery maker Northvolt and built a dedicated CNT slurry plant next to Northvolt’s Swedish gigafactory. At full operation, the plant is expected to generate about KRW 70bn in annual sales.

Interpretation: Battery materials are a strategic hedge against semiconductor customer concentration and industry cycles. EV battery demand is driven by different factors, so it can become a second growth engine.

6. Checklist

  • Whether dividend increases, stronger IR, or shareholder-return policies emerge during inheritance-tax funding.
  • Whether the market applies a valuation premium after the foaming-agent split clarifies the electronic-materials identity.
  • Whether EUV PR products and customers expand.
  • Whether CNT slurry plant utilization and Northvolt contract revenue ramp as planned.
  • Whether the trailing PER gap narrows versus Japanese peers: roughly 10-11x for Dongjin versus 20x for TOK and 17x for Shin-Etsu in the source.

Sources

Naver original