KOSPI 8,700 Valuation Hinges on 4.51x PER, 4,200 Support

What the KOSPI 8,700 Thesis Means for Investors

On October 28, 2026, Maeil Business Newspaper Securities used PER and PBR analysis to estimate the KOSPI’s fair value at 8,700 points and its support level at 4,200. For investors, these figures are about more than a single index target. They underscore the need to separate earnings already reflected in current prices from forecasts that have yet to be confirmed.

The analysis presents a valuation range by examining which multiples should be applied to the KOSPI’s earnings and net assets. The upper figure assumes projected 2026 earnings will materialize, while the lower figure reflects a defensive level based on net assets. Even for the same market, conclusions can diverge sharply depending on the denominator and reference date.

At 4.51x PER, Examine the Denominator Before the Low Multiple

As of the October 26 closing price, the KOSPI’s market capitalization stood at 4,514 trillion won, while Maeil Business Newspaper Securities calculated a PER of 4.51x based on projected 2027 earnings. The multiple starts from a forecast that the combined net profit of KOSPI-listed companies will reach 1,000 trillion won over the next year. Whether the market is truly cheap ultimately depends on how much confidence investors place in that earnings forecast.

A forward PER values prices against future earnings. If net profit meets forecasts, the low multiple could support a re-rating. If earnings fall short, the denominator shrinks, raising the PER at the same market capitalization and weakening the undervaluation case. Market capitalization is known today; future net profit is not.

Valuations Are Low on Confirmed Earnings, but 8,700 Is Conditional

Based on Korea Exchange (KRX) data, the KOSPI’s trailing 12-month PER—using earnings from the second half of 2025 and the first half of 2026—is 9.11x. That is below the 2016-2025 average of 15.72x cited by Maeil Business Newspaper Securities and the 2018 multiple of 9.58x. This indicates that valuation multiples are low even when measured against earnings already reported rather than forecasts.

The 8,700-point estimate was derived by applying a 9x PER—the lowest multiple based on historical earnings—to projected 2026 net profit of 800 trillion won for KOSPI-listed companies. This is also the basis for the view that the index has 60% upside from its current level. However, full-year 2026 confirmed earnings and the index level the KOSPI may ultimately reach remain unknown. The 8,700-point figure is not a predetermined outcome but a valuation that holds only if its assumptions prove correct.

Samsung Electronics and SK Hynix Drive the Low Forward PER

• Samsung Electronics — Its PER based on next year’s projected earnings, as compiled by FnGuide, is 3.12x. For that low multiple to support an investment case, forecast earnings must translate into actual profit.
• SK Hynix — Its 12-month forward PER from the same source is 2.71x. If projected earnings hold, they support the KOSPI’s low forward PER; if forecasts deteriorate, the multiple will need to be recalculated.
• KOSPI — The low forward PERs of these two companies underpin the case for an index re-rating. Their individual multiples alone cannot guarantee that the KOSPI will reach 8,700; the combined earnings of all KOSPI-listed companies are the key benchmark.

PBR Points to a Defensive Level of 4,200

According to the Korea Exchange (KRX), the combined net assets of KOSPI-listed companies stood at 2,910 trillion won at the end of June 2026, up 21% from the end of the previous year. Maeil Business Newspaper Securities projected that total net assets would reach 3,500 trillion won by the end of 2026. The 4,200-point KOSPI support level is based on that forecast.

Conversely, the net-asset approach acts as a check on PER analysis that calculates the upper range solely from earnings forecasts. Total net assets at the end of 2026 have yet to be confirmed. The 4,200-point level is therefore not an absolute floor, but a valuation benchmark that may be useful if the 3,500 trillion won projection is met.

Three Figures Investors Should Monitor

• Confirmed full-year 2026 earnings — The first test of the 8,700-point valuation case is whether projected net profit of 800 trillion won for KOSPI-listed companies is realized.
• Net profit over the next year — The credibility of the 4.51x PER based on projected 2027 earnings depends on whether the 1,000 trillion won forecast holds.
• Total net assets at the end of 2026 — The gap between the projected 3,500 trillion won and the actual figure will determine how investors interpret the 4,200-point support level.
• Projected earnings for Samsung Electronics and SK Hynix — Investors must determine whether their low PERs of 3.12x and 2.71x, respectively, remain intact to assess the durability of the index re-rating.

Conditions Required for a KOSPI Re-Rating

In the bullish scenario, forecast earnings translate into actual earnings and net assets continue to grow. The KOSPI’s 9.11x PER based on historical earnings and 4.51x PER based on projected earnings would then work together as evidence of a low valuation.

The conditions that would invalidate this scenario are clear: actual net profit falling short of the 800 trillion won full-year projection and the 1,000 trillion won forecast for the next year, or total net assets at the end of 2026 missing the 3,500 trillion won estimate. Investors should focus next on confirmed earnings and net assets rather than index movements. Until those figures are available, 8,700 and 4,200 are not predictions but conditional valuation markers.

This article was automatically summarized and analyzed from the original news report. View Original Article (Maeil Business Newspaper Securities)