BK Holdings, a subsidiary of the Bokwang Group, was once listed on the KOSDAQ as a semiconductor materials company, Phoenix Materials. The company changed its name in 2022 and exited the semiconductor business, shifting its focus to advertising. However, continued poor performance has seen its market capitalization shrink to below 10 billion won. The stock price is also on a downward trend, with the company increasingly leaning toward delisting.
According to the Korea Exchange, BK Holdings issued a warning on June 16 regarding its designation as a management issue due to its market capitalization falling below 15 billion won. As of July 14, the company's stock price was 383 won, with a market capitalization of approximately 9 billion won. Over the past year, the stock price has dropped by 60.7%, significantly diminishing the company's value.
BK Holdings originated as Phoenix Materials, which was listed on the KOSDAQ in 2004 and produced solder balls and metal pastes used in semiconductor packaging processes. After undergoing business restructuring, the company now primarily focuses on advertising production and media agency services. However, the results of this restructuring have been disappointing. Last year, the consolidated revenue was 7.4 billion won, a 41.4% decrease from the previous year, with an operating loss of 3.6 billion won and a net loss of 3.9 billion won. The return on equity (ROE) was recorded at -29.35%, and total assets decreased from 28.9 billion won in 2022 to 14.4 billion won last year. The ongoing poor performance has led to a decline in stock prices, with BK Holdings seeing a drop of over 60% in the past year.
During this period, the largest shareholder has attempted to stabilize the company, but efforts have been insufficient. In May, BK Holdings conducted a third-party allocation of new shares to raise operating funds, with the largest shareholder, Korea Culture Promotion, investing about 3 billion won to acquire 3.75 million new shares at 800 won each. As a result, Korea Culture Promotion's stake increased from 25.13% to 37.06%. However, the market's response has been cold, with the stock price falling to around 300 won, less than half of the issuance price (800 won).
Investors are expressing frustration, as there seems to be no clear path forward despite the largest shareholder's capital increase. A securities industry official noted, "The concerns about designation as a management issue due to market capitalization shortfall have materialized, and the delay in performance improvement following the business transition is evident. Whether there are additional measures to recover corporate value will be a key factor in maintaining the listing in the future."
* This article has been translated by AI.
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