1. Why Did Costexis Dispose of its Treasury Stock?

Costexis disposed of 442,778 shares (5.68% of total outstanding shares) of its treasury stock to raise funds for convertible bond issuance. This is interpreted as a strategic move to improve its financial structure and expand its future business.

2. Sluggish Q1 Earnings, but Positive Factors Remain

Costexis recorded sluggish earnings in Q1 2025 due to seasonal factors, rising raw material prices, and other factors. However, the potential benefits from the growth of the 5G and electric vehicle markets, the competitiveness of its self-developed KCMC heat dissipation material, and the KRW 2 billion order backlog are factors that raise expectations for future growth. The recent change in the largest shareholder (from Han Kyu-jin to Han Tae-seong) and subsequent changes in management strategy should also be noted.

3. Treasury Stock Disposal: Opportunity or Crisis?

In the short term, there is a possibility of stock dilution due to the increase in the number of outstanding shares. However, from a long-term perspective, securing financial stability through the raised funds, expanding business related to 5G and electric vehicles, and investing in R&D are expected to strengthen corporate competitiveness and secure growth momentum.

4. Investor Action Plan

  • Monitor fund usage plans: Investors should closely monitor how Costexis utilizes the raised funds. Efficient fund execution is key to long-term growth.
  • Check convertible bond issuance conditions: Carefully review the interest rate, maturity, and conversion conditions of convertible bonds to assess the possibility of increased financial burden on the company.
  • Monitor market conditions: Continuously monitor the impact of external factors such as growth trends in the 5G and electric vehicle markets, and fluctuations in raw material prices and exchange rates.
  • Analyze management strategy changes after the change in the largest shareholder: Analyzing the new management’s strategic direction and execution capabilities is an important factor in investment decisions.