1. What are Daehan Optoelectronics’ Warrant Exercises?

Daehan Optoelectronics is issuing 1,712,386 new shares due to warrant exercises. The exercise price is 1,130 KRW, and the listing dates are October 10th and 20th, 2025. This represents approximately 1.33% of the market capitalization.

2. Why the Warrant Exercises and What is the Impact?

As the current stock price (1,517 KRW) exceeds the exercise price (1,130 KRW), warrant holders are likely to exercise their rights for profit-taking. However, the new share issuance can lead to stock dilution, putting downward pressure on the stock price in the short term.

3. How is Daehan Optoelectronics’ Financial Status?

  • Decline in Sales: Sales in the first half of 2025 decreased by 8.17% compared to the same period last year, primarily due to declining domestic sales. However, overseas sales are showing growth.
  • Operating Loss: Despite efforts to improve profitability, the company remains in an operating loss.
  • Efforts to Improve Financial Health: A rights issue in February 2025 raised capital and lowered the debt ratio.
  • Going Concern Uncertainty: Net loss and excess current liabilities raise concerns about the company’s ability to continue as a going concern.

4. What Should Investors Do?

  • Cautious Approach: Investors should consider the financial risks and uncertainties carefully before making investment decisions.
  • Further Monitoring: Closely monitor earnings announcements, overseas market performance, and efforts to improve financial structure.
  • Sell or Hold: It is recommended to sell or hold existing shares until there are clear signs of fundamental improvement. Avoid rushing into bargain hunting based on short-term price drops.