[After CB Issuance] Just 3 Months Apart... Divergent Expressions Among AceTech CB Investors

[Asia Economy Reporter Yoo Hyun-seok] Investors who invested in Ace Tech's convertible bonds (CB) are showing mixed reactions. As the conversion request period approaches, the conversion prices of CBs issued just three months apart differ by nearly three times. Early investors in the CB are likely to gain substantial profits, while latecomers are expected to see disappointing returns.

According to the financial investment industry on the 20th, Ace Tech issued the 34th series CB worth a total of 35 billion KRW last May, planning to use 9.2 billion KRW for operating funds such as raw material purchase payments and 25.8 billion KRW for debt repayment including private bonds and other borrowings. The nominal interest rate and maturity interest rate are both 0%, and the bond maturity date is May 26, 2023.

The conversion price was set at 8,825 KRW, with the conversion request period from May 26 to April 26, 2023. The issuance recipients included A-One Asset Management, Tiger Asset Management, NH Hedge Asset Management, Suseong Asset Management, Kiwoom Securities, Han Woo-dong, Kim Nam-soon, Jang In-geun, Do Hyun-man, and Han Jae-il.

At the time of issuance, Ace Tech's stock price hovered around 7,000 to 8,000 KRW (before reflecting the rights offering). However, the stock price began to surge from July, attributed to expectations of benefits from 5G investments. Ace Tech is a telecommunications equipment company manufacturing antennas, filters, and base station system equipment.

Expectations that global telecom companies would resume 5G (mobile communication) investments from this year were reflected. The stock price rose to around 35,000 KRW in September last year. Although the stock price has recently stalled, it still maintains the 26,000 KRW range.

With the stock price soaring, the expectations of the 34th series CB investors are also rising. Currently, the conversion price of the 34th series Ace Tech CB has been adjusted to 8,732 KRW. The closing price of Ace Tech yesterday was 26,250 KRW. If the stock price is maintained until May, investors can record a return of about 200%.

On the other hand, investors who invested in CBs issued three months later are expected to feel disappointed. In August last year, Ace Tech issued the 37th series CB worth 25 billion KRW. The nominal interest rate and maturity interest rate were 0.0% and 2.0%, respectively. The conversion request period is from August 21 to July 21, 2023.

At the time of issuance, Ace Tech's stock price had already surged. The issuance price was 29,407 KRW. The issuance price was adjusted twice: from 29,470 KRW to 23,631 KRW in October last year, and then to 23,557 KRW in December of the same year. However, it is currently not much different from the current stock price. If the stock price is maintained until August, investors can gain about a 10% profit.

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