1. IA Corp (038880) H1 2025: What Happened?

IA Corp’s H1 2025 consolidated revenue was KRW 23.723 billion, a 9.0% decrease year-over-year. Increased competition and a slow recovery in the global automotive market are cited as primary reasons. While the operating loss narrowed to KRW -1.711 billion compared to the previous year, the net loss widened to KRW -9.902 billion due to losses from investments in associates and increased financial costs related to convertible bonds. The debt-to-equity ratio increased to 94%, while the current ratio improved to 84.3%.

2. Key Event Analysis: Why These Results?

  • Funding: Raised approximately KRW 167.4 billion through rights offerings and convertible bond issuances in January and February 2025, securing resources for financial restructuring and new business investments.
  • Management Restructuring: Change in major shareholder (DC Corp) and CEO (Dong-Cheol Choi) raises expectations for new growth strategies and improved management efficiency.
  • Building Sale: Sale of the Munjeong-dong building demonstrates efforts to improve financial structure and secure liquidity.

3. Investment Strategy: What’s Next?

IA Corp is securing new growth engines in cloud solutions and seeking change through management restructuring. However, risks remain, including sluggish performance in the core business, high debt-to-equity ratio, and uncertainties surrounding new ventures. A long-term perspective is recommended, closely monitoring the execution of business strategies, profitability improvements, and stabilization of the financial structure. The current investment opinion is ‘Neutral’.

4. Action Plan for Investors

If considering investing in IA Corp, the following action plan is recommended:
1. Verify the growth and profitability indicators of the cloud solutions business.
2. Monitor the competitiveness enhancement and performance improvement of the automotive electronics business.
3. Check the financial structure improvement trend and debt-to-equity ratio management status.
4. Evaluate the management’s ability to execute business strategies and their performance.