[Edaily Reporter Shin Ha-yeon ] On the 11th, independent research firm Value Finder analyzed that JEONJINBIO CO., LTD.(110020)is expanding its business structure—currently centered on capsule detergents—into comprehensive home care manufacturing, and expects earnings to improve next year following the launch of new automated production facilities. Diversifying the product lineup supplied to existing clients and securing new business partners are cited as key growth drivers. The firm did not provide an investment opinion or a target stock price.

Lee Chung-heon, CEO and researcher at Value Finder, explained in a report released that day, “The company is expanding its product offerings not only within laundry-related items—such as highly concentrated liquid detergents, fabric softeners, dishwashing detergents, and air fresheners and deodorizers—but also across the entire home care sector, including kitchen and bathroom cleaning products, moving beyond its capsule detergent-centered business structure.”

JEONJINBIO CO., LTD. is a household goods manufacturer that went public on the KOSDAQ market in 2018. It produces and sells capsule detergents made from natural materials, as well as air fresheners, deodorizers, pet products, and pest control products. As of the first half of this year, its revenue breakdown was 77.3% from household goods, 18.6% from pet products, 4.0% from pest control products, and 0.1% from other categories.

Building on its capabilities in original design manufacturing (ODM) for capsule detergents, the company is expanding its business scope to encompass the entire home care product category. The strategy involves broadening its product lineup from traditional laundry detergents to kitchen and bathroom cleaning products, while simultaneously increasing the range of items supplied to key clients.

The analyst noted, “The company is pursuing the expansion of Yuhan Corporation’s premium product line, the diversification of Atomy’s product offerings and production tailored to export strategies, and the expansion of supply categories for the Armed Forces Welfare Agency,” adding, “It is implementing a horizontal and vertical revenue expansion strategy aimed at simultaneously increasing sales to existing clients and the number of new business partners.”

In addition, the company plans to expand distribution channels for new pet food products. This move is interpreted as an effort to secure a stable revenue base by diversifying a business structure that has been concentrated on specific product lines.

The key to improving performance lies in the operation of new automated facilities. JEONJINBIO CO., LTD. has completed the expansion of its automated facilities by investing 1 billion won to accommodate the growth of its home care business. These facilities began commercial operation in the fourth quarter of this year, and the supply volume secured through the new facilities is projected to exceed 5 billion won annually.

The analyst explained, “The company’s commitment to high-quality manufacturing—as evidenced by obtaining Italian vegan certification, receiving the highest rating from Germany’s Dermatest, and being recognized as an outstanding company by the Atopic Dermatitis Association—is gaining prominence in the market,” adding, “We proceeded with the expansion to meet the demand for home care products, which had been confirmed in advance by our clients.”

He further predicted, “The supply capacity secured through this new investment is projected to exceed 5 billion won annually, so we expect a more pronounced improvement in performance next year compared to this year.”

In fact, JEONJINBIO CO., LTD. has been experiencing poor performance since last year. Although the company successfully returned to profitability in 2024 with revenue of 19.3 billion won and an operating profit of 1.2 billion won, last year’s revenue fell 28.9% to 13.7 billion won, and the company slipped back into the red with an operating loss of 300 million won.

Revenue for the first half of this year totaled approximately 5.8 billion won, marking only a 0.4% increase year-over-year, while the operating loss continued at about 500 million won. Disruptions in the supply of raw and auxiliary materials due to geopolitical risks, which hindered smooth product production and supply, were cited as the primary cause.

However, ValueFinder determined that this poor performance was not due to a weakening of the company’s manufacturing competitiveness. The analyst stated, “This is merely a profitability issue caused by external variables and is unrelated to the company’s unique ODM capabilities for capsule detergents across the entire process of product planning, manufacturing, and packaging,” adding, “The growth trend, including the expansion into new home care categories, continues.”

The growth of the domestic capsule detergent market is also a positive factor. According to the report, the size of the domestic capsule detergent market expanded from 67.9 billion won in 2024 to 82.2 billion won last year and is expected to reach 99.5 billion won this year. The report explains that the company can diversify its revenue streams with new home care products while maintaining the growth foundation of its existing capsule detergent business.

The major shareholder’s on-market purchases are also worth noting. Lee Tae-hoon, CEO of JEONJINBIO CO., LTD., disclosed that he had purchased the company’s shares on the open market in four separate transactions since last June. As a result, CEO Lee’s stake increased from 4.2% to 6.4%.

The analyst noted, “In line with the expansion of the business scope, the company has completed the installation of automated production facilities for home care products, and these facilities began commercial operation in the fourth quarter.” He added, “While the supply volume secured through new investments is expected to lead to improved earnings next year, the largest shareholder’s on-market purchases are continuing.”