1. What Happened?

Daejin Advanced Materials announced the issuance of 6.5 billion won in convertible bonds on August 7, 2025. The conversion price is set at 9,349 won, with a 0.0% coupon rate and a 5.5% maturity rate. Payment is scheduled for August 14, 2025. The significant difference between the current stock price (536 won as of August 6, 2025) and the conversion price is noteworthy.

2. Why Issue Convertible Bonds?

The funds raised through this bond issuance will be used for new business development, strengthening R&D, and facility investment. Daejin Advanced Materials has seen positive momentum, with a 79% year-on-year increase in sales in Q1 2025, driven by the growth of the secondary battery materials market. This funding is expected to further accelerate this growth.

3. So, What’s the Impact on the Stock Price?

In the short term, the news of the convertible bond issuance could weigh on investor sentiment, and a sharp rise in the stock price is unlikely. In the medium to long term, the efficient use of the raised funds will determine the stock’s direction. Successful deployment leading to improved earnings could create positive momentum, while inefficient use could lead to stock dilution and downward pressure.

4. What Should Investors Do?

  • Carefully monitor the company’s plans for the funds and their actual use.
  • Keep a close eye on the stock price and the gap between the conversion price and current market price.
  • Continuously monitor the company’s profitability.