[At the Crossroads] Anapass ① Double Whammy: Plunging Earnings and Largest Shareholder's Forced Sale Risk

Operating Profit Plunges 86% in Q1 Due to Sharp Drop in Major Client Deliveries
Growing Market Anxiety Over Largest Shareholder’s Collateralized Loan Risk

As Anapass, a KOSDAQ-listed company, faces sluggish performance due to decreased deliveries to major clients, growing concerns are emerging in the market about the additional risk of large-scale stock-collateralized loans by its largest shareholder.

According to the Financial Supervisory Service’s electronic disclosure system on July 8, Anapass reported sales of 15.2 billion won in the first quarter of this year, down 31.6% compared to the same period last year. Operating profit plummeted by 86.5% to 480 million won.

Anapass is a fabless company that designs timing controllers (T-Con) and TED ICs, which are key driver semiconductors for display panels. The company holds a patent for its proprietary interface technology, AiPi. As of the end of the first quarter, 97.8% of the company's sales came from products targeting organic light-emitting diode (OLED) applications.

The primary reason for the decrease in first-quarter sales was the suspension of deliveries to its main clients. There are three major clients—referred to as A, B, and C—that each account for more than 10% of Anapass's sales. Among them, sales to client B, which amounted to 6.6 billion won in the first quarter of last year, dropped to 800 million won in the first quarter of this year, an 88.3% decline. Sales to client C, which recorded 1 billion won in the first quarter of last year, were completely halted. Sales to its largest client, A, also saw a slight decrease.

Although sales declined, selling and administrative expenses increased by more than 10%, further eroding operating profit. Salary expenses and general R&D expenditures in particular stood out. As is typical for fabless companies, fixed costs such as personnel expenses and core technology R&D increased, while the drop in sales volume led to shrinking margins.

While operating profit fell sharply, net profit for the period reached 3.9 billion won. This is analyzed as being a result of exchange rate gains. In the first quarter, Anapass recorded 1.87 billion won in foreign currency translation gains. Since Anapass holds dollar-denominated assets for business operations, it tends to record other income during periods of rising exchange rates.

With performance declining, the share price has also remained sluggish. In June 2024, Anapass's share price rose to the 30,000 won range, but over the past two years it has steadily declined to the 14,000 won range. Notably, even though Anapass posted strong annual operating profits of 20 billion won in both 2024 and 2025, its share price continued to fall.

One of the reasons cited in the market for Anapass’s poor share price is the stock-collateralized loans by its largest shareholder. Lee Kyungho, the CEO and largest shareholder of Anapass, has pledged most of his 14.2% stake as collateral for loans. The total amount secured by collateral is 35.6 billion won.

The loan-to-collateral maintenance ratio for these stock-collateralized loans has not been disclosed. However, considering the amount of loans and the number of shares pledged as collateral, forced selling may be triggered if Anapass’s share price falls below the 18,000 to 20,000 won level. At the current price, a large volume of forced sales could occur at any time.

According to media reports, IBEST Investment and CEO Lee Kyungho, the lender and borrower, have a relationship of vested interest, which is said to be the reason the loan keeps getting extended. However, there has been no disclosure about the specific nature of this relationship or whether forced selling is impossible, which heightens market anxiety.

Anapass did not respond to multiple requests for comment on this matter.

This content was produced with the assistance of AI translation services.