1. What is Polaris Seowon’s Warrant Exercise?

The exercise of 840,757 warrants will result in the issuance of new shares, representing 1.22% of the market capitalization. The exercise price is 1,085 KRW, which is lower than the current stock price (1,351 KRW). This suggests investors exercised the warrants anticipating future stock price appreciation.

2. Why Were the Warrants Exercised Now?

Since the current stock price is higher than the exercise price, it’s likely investors exercised the warrants for profit-taking. Expectations for Polaris Seowon’s business expansion could also be a contributing factor.

3. How Will the Warrant Exercise Impact the Stock Price?

  • Short-term impact: Potential downward pressure on stock price due to an increase in outstanding shares. Dilution of existing shareholders’ equity.
  • Long-term impact: Improved financial stability due to capital inflow, enabling business expansion and R&D investment. Potential for stock price increase if fundamentals improve.

4. What Actions Should Investors Take?

Rather than reacting to short-term stock price volatility, it’s crucial for investors to carefully analyze Polaris Seowon’s fundamentals, including the automotive industry recovery rate, raw material price stabilization, and profitability improvement of the AI business, and make investment decisions from a long-term perspective. Macroeconomic variables and the dilution effect should also be considered.