In an interview with E-Daily on the 14th, Cho Yong-cheol, CEO of IlshinStone, stated, “We are well aware that a stock split alone does not increase the company’s intrinsic corporate value,” adding, “Stock prices must ultimately be driven by performance.”
On August 5, IlshinStone’s stock price fell below 1,000 won for 25 consecutive trading days, raising concerns that it would be designated as a “monitored stock,” and it was officially designated as such on August 13. Subsequently, trading was suspended starting September 3 to facilitate a 5-for-1 par value consolidation and resumed on the 1st following a re-listing. CEO Cho stated, “The company was not designated as a ‘monitored stock’ because it was repeatedly posting losses or had suspended operations,” adding, “It is regrettable that the market has not fully recognized the fact that we have maintained our core business and consistently generated operating profits even amid a challenging construction market.”
In fact, despite a decline in revenue, IlshinStone has posted operating profits for three consecutive fiscal years. Last year, the company recorded revenue of 54.5 billion won and an operating profit of 700 million won. Although it posted a net loss, it maintained a profit at the operating level. Revenue, which stood at 137.7 billion won in 2022, has declined for three consecutive years since then. While revenue at that time included a one-time large-scale project worth approximately 150 billion won, the subsequent completion of that project, coupled with the construction market downturn, led to the decline.
CEO Cho explained, “We estimate that the current size of the domestic stone market has shrunk to about 40% of its 2022 level,” adding, “This was largely due to the slump in Chonbang industries rather than a simple weakening of the company’s sales capabilities.” He continued, “Recently, orders have increased, particularly from top-tier construction firms, leading to a year-over-year rise in our order backlog,” and predicted, “The stone construction sector is expected to see a gradual recovery starting in 2027.”
The ceramics business is identified as the key to a turnaround in performance. In response to declining demand for natural stone, the company introduced “Infinity,” a premium Italian porcelain big-slab brand, and is expanding its product lineup by adding the new brand “Gentile.” The company believes the risks associated with this business transition are lower than entering a completely unfamiliar field, as it can leverage its existing stone processing and installation capabilities and existing client base.
Ceramic sales grew to account for approximately 40% of the distribution division’s revenue last year. Based on projects for which contracts have been signed or that have been adopted in apartment model homes, the estimated volume is 3 to 4 times the company’s ceramic sales over the past year.
CEO Cho stated, “Due to the nature of construction projects, there is a time lag between signing a contract and the revenue being recognized,” adding, “We expect revenue recognition to begin in earnest in the second half of 2027, and we anticipate that ceramic sales will grow to 2.5 to 4 times their current level starting in 2028.”
The company is also increasing the proportion of high-value-added products to improve profitability. It plans to target the high-end residential and commercial markets through its premium natural stone brand “Il Sole” and expand its business scope with “CosmoLight,” an eco-friendly artificial stone free of silica, as well as sound-absorbing materials from Italy’s Caimi.
CEO Cho emphasized, “In the global market, premium stone priced at over $100 per square meter accounts for more than 20% of the total market, but its share in the domestic market is only about 2–3 percent,” adding, “Rather than focusing on price competition, we must transform our profit structure by prioritizing high-margin products that emphasize design, quality, and eco-friendliness.”
The company will also expand its sales model from a business-to-business (B2B) focus to business-to-consumer (B2C). The strategy involves increasing consumer touchpoints by leveraging showrooms in Gangnam and Busan as hubs, while expanding its dealer network to directly capture demand for interior design and remodeling.
The company has set targets of 110 billion won in revenue and 5.5 billion won in operating profit by 2030. Its policy is not merely to recover past revenue levels but to improve the quality of profits by increasing the proportion of ceramics and premium materials.
CEO Cho stated, “The value of our real estate holdings alone—including approximately 60,000 pyeong of land and a factory in Icheon, as well as a quarry of about 40,000 pyeong in Pocheon—is estimated at over 100 billion won, yet our market capitalization falls short of this figure.” He added, “Rather than merely emphasizing asset value, we will address this undervaluation through the results of our business transformation and profit growth.”
