Korea Stock Market Insights

Tag: THE CUBE&

  • THE CUBE& Announces ₩7 Billion Divestment: Impact on Stock Price & Investment Opportunities

    1. What Happened?

    THE CUBE& has decided to sell its entire stake in its subsidiary, New Cube G&I, for ₩7 billion. The purpose of this divestment is to recoup investments and secure liquidity. The expected disposal date is August 22, 2026.

    2. Why the Divestment?

    THE CUBE& plans to use the funds secured through this divestment to invest in new businesses and strengthen its financial health. Currently, THE CUBE& is pursuing various new businesses, including solar energy, AI software development, and drone technology. This divestment is expected to play a crucial role in securing future growth engines by investing in these new ventures.

    3. How Will This Impact the Stock Price?

    Short-term impact: Securing ₩7 billion can positively impact the stock price in the short term. However, with the disposal date still a year away, a significant immediate surge is unlikely. Instead, the market is more likely to adopt a wait-and-see approach.
    Long-term impact: If the secured funds are utilized for investments in future growth drivers, it can lead to an increase in corporate value and, subsequently, a rise in the stock price in the long run.

    4. What Should Investors Do?

    THE CUBE&’s core business, automotive parts manufacturing, maintains stable growth, and its expansion into new businesses presents high growth potential. It’s crucial for investors to closely monitor the company’s plans for utilizing the divestment funds and to develop investment strategies based on future business progress and earnings announcements. However, it’s also essential to consider risk factors such as continued net loss on a consolidated basis and macroeconomic variables.

    What is THE CUBE&?

    THE CUBE& is a company whose core business is automotive parts manufacturing. Recently, they have also ventured into new businesses such as solar energy, AI software, and drones.

    What is New Cube G&I?

    New Cube G&I (formerly New Cube Games) is a game software developer and supplier.

    How will the ₩7 billion from the divestment be used?

    The funds will be used for investment recovery and securing liquidity, specifically for investing in new businesses and strengthening financial health.

  • THE CUBE& H1 2025 Earnings Report Analysis: Profitability Achieved, But Caution Advised

    1. What Happened? THE CUBE& H1 2025 Performance Analysis

    THE CUBE& announced its H1 2025 earnings, exceeding market expectations for revenue and achieving operating profit. However, net income remains negative.

    • Revenue: KRW 6.3B (Exceeded market expectations)
    • Operating Profit: KRW 200M (Turned to profit)
    • Net Income: KRW -600M (Net loss continues, reduced compared to the same period last year)

    2. Why These Results? Drivers of Profitability and Growth

    Key factors contributing to the operating profit turnaround are business expansion of major clients like HD Hyundai Infracore and Hyundai Motor Company, along with new business achievements such as THE CUBE&’s eco-friendly engine parts supply contract. Operating cash flow has also significantly improved.

    3. What’s Next? Potential Risks and Investment Strategy

    Despite positive factors, uncertainties such as a slowdown in the overall automotive industry, exchange rate volatility, financial burden from high investment activities, and management changes remain risk factors. The slight decline in Q2 performance compared to Q1 is particularly concerning.

    4. What Should Investors Do? Action Plan

    Investment in THE CUBE& requires a cautious approach. It’s crucial to closely monitor future earnings improvement, performance of new businesses, and the company’s ability to respond to exchange rate fluctuations and changes in the macroeconomic environment before making investment decisions.

    How did THE CUBE& perform in H1 2025?

    THE CUBE& recorded KRW 6.3B in revenue (exceeding market expectations), KRW 200M in operating profit (turning to profit), and KRW -600M in net income (net loss continues).

    What are the main growth drivers for THE CUBE&?

    Business expansion of major clients and new business achievements such as the eco-friendly engine parts supply contract.

    What should investors be aware of when considering THE CUBE&?

    Consider risk factors such as a slowdown in the automotive industry, exchange rate volatility, financial burden, and management changes.