Its shares jumped 29.84 percent to 3,220 won (US$2.35) on the junior KOSDAQ as of around 2:40 p.m., reaching the market's daily price ceiling.
The rally came after the company said it had been selected for a research project led by the Ministry of Science and ICT (MSIT) and the National IT Industry Promotion Agency (NIPA).
The project, with an investment of 70.2 billion won over five years through 2030, involves developing a software platform for physical AI, which refers to AI systems that can understand real-world conditions and use machines such as robots to take physical action.
Jeonbuk National University will lead a government-led consortium for the project, bringing together LaonPeople, NC AI, an artificial intelligence subsidiary of game developer NCSoft, and 13 other companies, universities and research institutions.
At the center of the project is the development of a physical AI foundation model for a software-defined factory (SDF), where software and AI coordinate manufacturing operations. The model will use data from sensors, robots and other equipment to monitor factory conditions and help make operational decisions.
The system is designed to detect changes on the factory floor and respond by reallocating tasks or adjusting production schedules. The broader goal is to allow AI to make and carry out more manufacturing decisions with less human intervention. The project is part of the government's broader manufacturing AI strategy, which calls for systems that can understand factory processes and autonomously control equipment and robots.
The platform will first be tested at three manufacturing companies including automotive parts producers, before trials are expanded to other industries.
LaonPeople will apply the model to automotive parts production and robotic systems. It plans to develop tools that can detect unusual conditions, predict equipment failures before they occur and improve production processes.
It also plans to combine its existing vision-language model, an AI system that can interpret both images and text, with AI agents that can use that information to make decisions and direct robots to carry out tasks.
It ultimately plans to turn the technology into an edge AI board, a piece of computing hardware installed directly in a robot or other factory equipment so AI processing can take place on the machine itself rather than relying entirely on a remote server or data center. The company plans to use the hardware to expand its business in the industrial robotics market.
Founded in 2010, LaonPeople develops AI systems that automate business and manufacturing tasks including machine-vision technology that uses cameras and AI to inspect products and detect defects.
AJP Takeaways
• LaonPeople shares hit the KOSDAQ's daily price ceiling at 3,220 won ($2.35) as of 2:41 p.m. on Sept. 3, 2026, after the South Korean artificial intelligence company was selected for a government-backed physical AI project.
• The Jeonbuk National University-led project brings together LaonPeople, NC AI and 13 other companies, universities and research institutions, with 70.2 billion won ($51.3 million) to be invested over five years through 2030.
• LaonPeople will develop physical AI technology for automotive parts production and robotic systems, including tools that detect abnormal conditions, predict equipment failures and improve manufacturing processes.
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