During a meeting on the 7th at the SC Engineering headquarters in Gangseo-gu, Seoul, CEO Kim Ki-woong said, "Currently, the stock price of SC Engineering does not reflect the value of its subsidiary SC Engineering at all and remains undervalued."
SC Engineering, a KOSPI-listed company and a specialized EPC (Engineering, Procurement, and Construction) corporation with 54 years of history, handed over management rights to EV Advanced Materials in January this year. CEO Kim was appointed as the new representative director with the change in management.
Currently, CEO Kim is fully focused on maximizing corporate value through restructuring core businesses. This comes from the judgment that the corporate value is significantly undervalued compared to the potential the company holds. As of the closing price on the 9th, the stock price of SC Engineering was 1,332 won, with a market capitalization of about 46.7 billion won.
CEO Kim noted, "Last year, we recorded the highest order achievements in history, including winning the construction project for the largest hydrogen production plant in the country," adding, "However, in the stock market, we have been unable to escape the undervaluation state, failing to meet shareholder expectations."
The existing core business of SC Engineering, EPC, fluctuates significantly depending on economic conditions. CEO Kim stated, "Due to this characteristic, the market tends to give a very low valuation to EPC companies," and added, "The way to maximize SC Engineering's valuation is ultimately to utilize the value of its 100% subsidiary SC Engineering."
SC Engineering plans to restructure its business focusing on SC Engineering. SC Engineering is a bio collagen medical device company that produces joint injection products 'Cartizol' based on bio collagen raw materials and facial filler 'Terrafill.'
SC Engineering incorporated SC Engineering as a subsidiary in 2021. The sales of SC Engineering, which were 7.2 billion won at that time, have more than doubled to 18.2 billion won last year.
CEO Kim remarked, "There are not many companies among bio corporations that are genuinely making money, but SC Engineering is a company that is making profits," adding, "Considering the growth potential and technological capabilities of SC Engineering, I believe it can at least reach the market capitalization of medical device companies operating similar businesses."
CEO Kim said that the newly prepared Geumgok plant in Namyangju, Gyeonggi Province, aims to start operations by the end of next year and will lead SC Engineering's future growth. The Geumgok plant is expected to require a total investment of 55 billion won, with 30 billion won for the construction and 25 billion won for facility investments.
He stated, "Currently, the quantity produced at the SC Engineering Seongsu factory is sold 100%, but supply cannot keep up with demand," adding, "The production capacity of the Geumgok plant will be more than five times that of the Seoul factory."
According to the company, SC Engineering has secured a minimum order quantity (MOQ) of about 125 billion won in overseas markets by collaborating with numerous partners, including China’s Cihua Pharmaceutical. CEO Kim reported that the company has also built a stable expansion base through a joint marketing system with LG CHEM, Dongkook Pharmaceutical, and KOLON in the domestic market.
CEO Kim stated that he will focus on increasing sales and operating profit by expanding the company volume in the short term. He remarked, "I am confident that I can increase the current market capitalization (46.7 billion won) by over ten times," adding, "I will consider shareholder returns after first growing the company size."