HLB Issues ₩20 Billion in Convertible Bonds: What Happened?
HLB announced on September 24, 2025, that it would issue ₩20 billion in private placement convertible bonds (CBs). Key terms include a coupon rate of 1.0%, a maturity rate of 4.0%, and a conversion price of ₩38,822. Payment is scheduled for October 2, 2025.
Why the CB Issuance?
HLB aims to secure funds for the development of new drugs, including rivoceranib, through this CB issuance. This is expected to contribute to accelerating R&D and ensuring stable business operations.
So, What’s the Impact on the Stock Price?
- Positive Impacts:
- Securing operating funds positively impacts new drug development and business activities.
- Expected diversification of investors and improvement of financial structure.
- Current stock price (₩1,797) significantly lower than the conversion price (₩38,822), mitigating immediate dilution concerns.
- Potential Negative Impacts:
- Possibility of stock dilution if the stock price rises and CBs are converted.
- Interest expense burden with a coupon rate of 1.0% and a maturity rate of 4.0%.
- Continued uncertainty about the success of the bio business.
What Should Investors Do?
Consider HLB’s new drug development performance and future stock price trends rather than just the CB issuance itself.
- Continuously monitor updates on rivoceranib’s FDA approval.
- Monitor stock price movements relative to the conversion price (₩38,822).
- Keep an eye on interest rate trends.
- Check the performance of other business segments, such as healthcare and shipping.
This analysis is not investment advice. Investment decisions should be based on your own judgment.