1. What Happened? Overview of Playwith’s Convertible Bond Exercise
On September 19, 2025, Playwith announced the exercise of convertible bonds for 143,740 shares. This represents 1.64% of the current market capitalization, with a conversion price of 4,522 KRW. The converted shares are scheduled to be listed sequentially on October 1 and 10, 2025.
2. Why Does it Matter? Impact Analysis of the Convertible Bond Exercise
The exercise of convertible bonds can lead to short-term downward pressure on the stock price due to the increased number of shares. However, it can also lead to improved financial structure through debt reduction and capital increase. The key point is that the current stock price (5,250 KRW) is higher than the conversion price (4,522 KRW). This implies the possibility of profit-taking through the exercise of convertible bonds, and investors should be wary of potential selling pressure.
3. So What? Investment Implications and Action Plan
- Short-term Investors: Be cautious of increased stock price volatility due to the influx of converted shares. Careful investment decisions are necessary, considering the possibility of short-term price declines.
- Long-term Investors: Focus on the positive impact of the improved financial structure. However, continuous monitoring of Playwith’s fundamentals is crucial, particularly focusing on improvements in operating profit.
4. Playwith Company Analysis
Playwith is a game developer that services online games such as Rohan Online and Seal Online, and mobile games like Seal M and Rohan 2. Despite recent growth in mobile game sales, the company continues to experience operating losses, with high royalties, payment fees, and intangible asset amortization expenses acting as major risk factors.
Frequently Asked Questions (FAQ)
What are convertible bonds?
Convertible bonds (CBs) are a type of bond that gives the holder the right to convert the bond into a predetermined number of shares of the issuer’s common stock at a specified price (conversion price) within a particular period.
How does the exercise of convertible bonds affect stock prices?
In the short term, it can put downward pressure on stock prices due to increased share supply. However, in the long term, it can positively impact the financial structure by reducing debt and increasing capital.
What should I be aware of when investing in Playwith?
Be mindful of increased short-term stock price volatility, and continuously monitor the company’s fundamentals, particularly the improvement in operating profit and the success of new game releases.
