1. What Happened?

Iljin Diamond reported consolidated revenue of KRW 68.05 billion, an operating loss of KRW 4.197 billion, and net income of KRW 3.785 billion, a decrease compared to the same period last year. The poor performance of its subsidiary, Iljin Hysolus, significantly impacted the overall results.

2. Why Did This Happen?

Analyzing each business segment, the industrial diamond sector faces challenges from low-priced competition from Chinese manufacturers, while Iljin Hysolus struggles with the downturn in the hydrogen vehicle market. The new secondary battery materials business is still in its early stages. Financially, despite a low debt-to-equity ratio, substantial capital expenditures have resulted in cash outflows, potentially leading to future financial burdens. Furthermore, the company’s profitability is highly susceptible to exchange rate fluctuations.

3. What’s the Outlook?

In the short term, Iljin Hysolus’s recovery and the performance of the secondary battery materials business will significantly influence the stock price. Long-term prospects hinge on the growth potential of the hydrogen business and the company’s ability to adapt to changes in the macroeconomic environment.

4. What Should Investors Do?

Short-term investors should closely monitor Iljin Hysolus’s competitiveness recovery, the initial performance of the new business, and the company’s exchange rate risk management strategies. Long-term investors should consider the growth potential of the secondary battery materials business, the long-term prospects of the hydrogen business, and the company’s adaptability to macroeconomic changes when making investment decisions.