Paek Jongwon's US Visit Sparks Two-Day Stock Surge... Will The Born Korea’s 'K-Sauces' Continue to Thrive?

The Born Korea’s Stock Jumps Over 20% on News of Distribution Expansion, Including Sauces
Share Price Recovers Past 20,000 Won in Intraday Trading
Domestic Store Count Falls Below 3,000 in First Half
Paikdabang’s Share Reaches 62% — "Reflec

The Born Korea is garnering attention as its stock price soars on the back of its aggressive expansion in distribution businesses—including sauces—in North America and other overseas markets. These developments come five months after CEO Paek Jongwon declared this year as the starting point for the company's transformation into a global total food corporation. Despite sustained deficits due to a prolonged slump in the domestic dining-out market, the company is shifting gears by investing in new markets and initiating changes to its business structure.

Paik Jongwon, CEO of Theborn Korea, demonstrated menu examples using 11 types of TBK sauces at the restaurant "Oshigye" in Los Angeles (LA), USA, on the 12th. Provided by Theborn Korea

According to the dining industry on August 18, CEO Paek Jongwon spent about two weeks from August 2 meeting with key local food distribution companies and restaurant stakeholders across North America—including the United States and Canada—to explore opportunities for collaboration in the restaurant business. As a result, The Born Korea signed a memorandum of understanding (MOU) with Sunray Group, which operates global brand hotels such as Marriott, Hilton, and Hyatt in Canada. The company also began sales efforts to expand local distribution of The Born Korea products—including TBK sauces—and CEO Paek personally introduced menu items using the sauces to local chefs at restaurants.

Following this news, The Born Korea's stock price recorded more than a 10% increase for two consecutive days. On August 13, the closing price was 14,090 won; after news broke of CEO Paek’s visit to the US on August 14, the price rose by 12.8% to 15,890 won. On this day as well, the stock closed at 19,360 won, up 21.8% from the previous trading day. This closing price marks the highest level in about three months since May 13, and at one point during the session, the price even surpassed the 20,000 won mark.

This sharp rally is believed to reflect heightened expectations for improved performance through the expansion of distribution products such as sauces, as well as overseas business growth. The Born Korea's stock price jumped as high as 60,000 won after its initial listing in November 2024 at an issue price of 34,000 won, but subsequently plummeted to the daily lower limit for several sessions due to various controversies and lackluster results, hitting as low as 12,700 won by July 30.

Paek Jongmin, CEO of Theborn Korea, Yonhap News Agency

The Born Korea is seeking to reposition itself as a total food corporation in the mid-to-long term. Immediately after the shareholders’ meeting in March, CEO Paek announced during a press event that he had set this year as "year one" for the company’s leap toward becoming a global total food company, with plans to expand overseas business and initiate new ventures based on its franchise operations. At that time, he stated, “We will focus on targeting overseas markets for global expansion,” and explained plans for business exchanges with local companies in regions such as the Americas, Southeast Asia, and Europe based on global B2B sauce sales. He predicted that performance would start to become visible around the middle of this year.

The Born Korea plans to continue investing in distribution products and overseas market entry in the near term, with an emphasis on business structure transformation and expansion to enhance competitiveness. However, most industry watchers expect that it will take considerable time for such a representative food service company to achieve a substantial transformation into a total food company. The company aims to reduce the share of franchise operations to around 50%–60% of total sales by expanding its distribution business and overseas revenue. As of the first half of this year, franchises accounted for 93.8% of total sales, while the distribution business made up 4.3%.

Another urgent task for The Born Korea is to address the lackluster results caused by the prolonged domestic restaurant market slump and various controversies. The company posted consolidated revenue of 83.2 billion won in the second quarter of this year, up 12.2% from 74.2 billion won in the same period last year. Operating losses were recorded at 5.6 billion won. Although this represents a 75.2% reduction in losses compared to the second quarter of last year, the company is still running a deficit. Cumulative revenue for the first half of the year was 162.8 billion won, down 11.9% from the same period last year, while operating losses were 9.8 billion won, narrowing from 16.3 billion won in the first half of last year.

The number of The Born Korea’s domestic stores is decreasing, while reliance on Paikdabang continues to rise. As of the end of June this year, The Born Korea operated 25 restaurant brands—including Paikdabang—with a total of 2,984 domestic stores. This is the first time since the company’s listing in November 2024 that the number of domestic stores dropped below 3,000. The share of Paikdabang and Paikdabang Bread Lab increased from 52.2% in 2023 to 55.8% in 2024, surpassed 59.5% last year, and rose to 60.6% in the first quarter of this year and up to 61.7% by the end of the first half.

A company representative explained, “The prolonged slump in the dining-out market has been deeper than expected, and the current situation—where low-priced coffee businesses are performing well while dining brands struggle—is directly reflected in the numbers. For other dining brands besides Paikdabang, we are testing delivery-focused stores and searching for survival strategies.”

Meanwhile, the recent surge in trading is expected to increase The Born Korea’s number of minority shareholders and trading volume. As of the end of June this year, The Born Korea counted 52,831 minority shareholders, holding 26.7% of the shares. At the end of 2024, there were 85,422 minority shareholders with a holding ratio of 24.5%, meaning the number of shareholders has decreased by over 30,000, while the ratio has risen slightly. In the first month after listing, the monthly trading volume reached 2 million, but the monthly average for the first half of this year was about 380,000.

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