[Edaily Reporter KIM SAE-MI ] Noul Co., Ltd.(376930)Although the company is proceeding with a 5-to-1 stock consolidation following its designation as a “monitored stock” due to a share price below 1,000 won, the risk of delisting is expected to persist. This is because, even after the stock consolidation, the market capitalization remains unchanged, and capital impairment and operating losses before corporate income tax (OBL) continue to be factors contributing to its designation as a monitored stock.

Even

if it escapes

penny stock status through a 5-for-1 consolidation… the next hurdle is market capitalization

According to the Korea Exchange on the 27th, Noul Co., Ltd. was designated as a “monitored stock” on the 13th due to its stock price falling below the minimum threshold (penny stock). This was because its stock price remained below 1,000 won for 30 consecutive trading days. Following designation as a monitored stock, the company may face delisting if it fails to recover to a price of 1,000 won or higher for 45 consecutive trading days within 90 trading days.

Previously, on June 2, Noul Co., Ltd. decided to conduct a stock consolidation, combining five common shares into one. Upon consolidation, the number of issued shares will decrease from 51,291,323 to approximately 10,258,264. Noul Co., Ltd. stated that the purpose of the stock consolidation was to “stabilize the stock price and enhance corporate value by maintaining an appropriate number of shares in circulation.”

On the 19th, the last trading day before the consolidation, the closing price was 334 won. Applying a simple 5-to-1 conversion ratio, the post-consolidation price would be approximately 1,670 won. If the stock price maintains this level after the consolidation, the company could avoid the issue of a share price below 1,000 won.

The company also acknowledged that it took into account the strengthened listing maintenance requirements during the decision-making process for the consolidation. Noul Co., Ltd. stated, “This stock consolidation was pursued to maintain an appropriate number of shares in circulation and adjust the price per share, thereby laying the groundwork for increased trading activity and enhanced corporate value,” adding, “Concerns raised in the market regarding the strengthened listing maintenance requirements in connection with the stock consolidation were also considered as part of the company’s comprehensive review of relevant regulations and market conditions.”

However, the official added, “We do not view the stock consolidation itself as a fundamental solution to the risk of being designated a ‘monitored stock,’” noting, “We believe that ultimately, increasing corporate value through business growth and improved profitability is of the utmost importance.”

The issue is that a stock consolidation does not necessarily increase market capitalization. Based on a share price of 334 won and the number of shares outstanding prior to the consolidation, Noul Co., Ltd.’s market capitalization is approximately 17.1 billion won. Following the 5-to-1 consolidation, while the price per share will increase by about five times, the number of shares will decrease to one-fifth; therefore, unless there is a change in the stock price, the market capitalization will remain unchanged.

The KOSDAQ market capitalization threshold for companies under market capitalization monitoring was raised to 20 billion won last month and will be further increased to 30 billion won starting next January. The current market capitalization of 17.1 billion won falls short of even the current 20 billion won threshold. To meet the 30 billion won requirement taking effect next year, the market capitalization would need to increase by approximately 75% from its current level.

Noul Co., Ltd. also recognizes this as a major risk. A Noul Co., Ltd. official stated, “The company recognizes the listing maintenance requirements related to market capitalization as a major risk and is continuously monitoring them,” adding, “We are also reviewing various measures to stabilize our financial structure, but it is difficult to discuss specific plans that have not yet been finalized.”

Risks of Negative Equity and Legal Losses… Prospects for Securing Additional Funds

Not only the stock price but also the financial structure poses a burden. As of the end of the first half of this year, on a standalone basis, paid-in capital stood at 25.6 billion won and total capital at 16.4 billion won; based on a simple calculation, the negative equity ratio is approximately 35.9%. The remaining equity buffer—based on a 50% capital impairment threshold—is approximately 3.6 billion won. Given that the standalone net loss for the first half of this year reached 9.1 billion won, the trend in the capital impairment ratio at year-end will be critical if losses continue in the second half.

The company has acknowledged this. Noul Co., Ltd. official stated, “Based on the standalone financial statements as of the end of the first half of 2026, the capital erosion ratio stands at approximately 36 percent,” but added, “The year-end capital erosion ratio may vary depending on second-half revenue, profit and loss, cost management, exchange rates, and other changes in equity, so it is difficult to predict a specific level with certainty at this point.”

A statutory loss is another risk related to being designated as a “monitored stock,” which could materialize depending on this year’s performance. Noul Co., Ltd.’s statutory loss for 2025 amounted to 20 billion won, equivalent to 78.37% of its equity. The deferral of the statutory loss requirement under the Technology Growth Exemption ended in 2024. According to KOSDAQ listing regulations, a company meets the criteria for designation as a “monitored stock” if it incurs statutory losses exceeding 50% of its equity in two out of the most recent three fiscal years and also incurs a statutory loss in the most recent fiscal year.

Noul Co., Ltd.’s pre-tax loss on a consolidated basis for the first half of this year was 9.3 billion won, representing 56.9% of its equity of 16.4 billion won at the end of the half-year. If the statutory loss ratio for the full year exceeds 50% of equity again, it would mark the second fiscal year out of the most recent three to exceed 50%, following last year, making this a situation that requires caution.

One of Noul Co., Ltd.’s challenges is to reduce this year’s annual statutory loss ratio to 50% or less of its equity. However, we were unable to obtain a definitive answer from the company regarding this matter. A Noul Co., Ltd. official stated, “At this point, it is difficult to say with certainty that the annual statutory loss ratio will fall below a specific level.”

The possibility of additional fundraising remains open. A Noul Co., Ltd. official noted, “We are keeping various funding options open—including attracting strategic and financial investments—and reviewing them from multiple angles to manage financial risks such as capital impairment and statutory losses, as well as to ensure medium- to long-term growth,” but drew a line by adding, “At present, we are not operating our business plan on the premise of an additional paid-in capital increase or the issuance of convertible bonds (CBs).”

Ultimately, a stock consolidation alone is unlikely to resolve the three risks associated with being designated a “monitored stock”—insufficient market capitalization, capital impairment, and statutory losses—because these issues must be supported by an increase in corporate value. The extent to which Noul Co., Ltd. can reduce its losses through revenue growth and cost reductions in the second half of the year is expected to determine the company’s future risk of delisting.