KOSDAQMachinery137080

Narae Nanotech

₩6,180▲ 1.15%2026-10-02 close

Market Cap

₩64.9B

Turnover

₩31,311,740

Volume

5,141 shares

Shares out.

10.7M

PER

1.1×

PBR

0.6×

EPS

₩5,820

Dividend Yield

0.00%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close

Report overview

Back to Profit After 12 Quarters, Durability in Question

Narae NanoTech returned to operating profit in the first quarter of 2026 after twelve consecutive loss-making quarters and stayed profitable in the second quarter, but its heavy reliance on the display order cycle and the pace at which its new semiconductor business takes hold will shape results going forward.

1
The company posted consecutive operating profits in the first and second quarters of 2026, exiting the loss-making stretch that had persisted since 2023.
2
Full-year 2025 net income surged to roughly KRW 40 billion even as the company remained in an operating loss, reflecting a large non-operating gain booked in the fourth quarter.
3
As of the first quarter of 2026, the display segment accounted for 84.63% of revenue and exports made up 89.9%, underscoring heavy dependence on a small customer base and overseas sales.
4
Renewed large-scale OLED line investment by China's CSOT and BOE, along with expansion into semiconductor panel-level-packaging coating and drying equipment, are cited as the drivers behind the company's recent earnings improvement.
5
As a small-cap stock with a market capitalization in the KRW 0.1 trillion range, the company pays no dividend, limiting income-oriented investment appeal.

Business structure

Founded in 1995, Narae NanoTech is a display automation equipment maker that has led the domestic equipment market with photoresist coaters and polyimide (PI) coaters for LCD and OLED processes, built on its coating, curing, and bonding technology.

As of the first quarter of 2026, revenue was split with the display segment at 84.63%, the battery segment at 11.00%, the semiconductor segment at 0.36%, and new businesses at 0.06%, showing a clear tilt toward display.

Export revenue made up 89.9% of the total, reflecting heavy reliance on overseas markets, while the largest customer accounted for 55% of sales and the second-largest for 24.07%, indicating a highly concentrated customer base.

The company has a track record of supplying coating and drying equipment to global display makers including LG Display, China's BOE, and HKC.

More recently, it has extended its coating expertise into semiconductor back-end panel-level packaging (PLP) and begun supplying coating and drying equipment to major overseas customers in that space.

It is also pursuing diversification into battery electrode process equipment, next-generation automotive displays, perovskite solar cells, and smart windows.

Competitors include Korean display and semiconductor equipment makers such as DMS, ICD, Avaco, Sunic System, Philoptics, and Future Company, many of which have also been mentioned as potential beneficiaries of new Chinese display makers' investment orders.

The company listed on KOSDAQ in February 2022 and subsequently endured several years of weak earnings amid a broader pullback in display investment.

Earnings trend

Quarterly revenue · Operating profit

₩20.2B-₩2.8B25Q2₩10.2B-₩2B25Q3₩15.8B₩400M25Q4₩17.3B₩700M26Q1₩20.7B₩3B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩88B₩2B2022₩52.9B-₩15B2023₩40.4B-₩22.1B2024₩54.5B-₩8.8B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩20.2B	-₩2.8B	−14.0%
2025Q3	₩10.2B	-₩2B	−20.1%
2025Q4	₩15.8B	₩400M	2.3%
2026Q1	₩17.3B	₩700M	3.8%
2026Q2	₩20.7B	₩3B	14.5%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩88B	₩2B	₩2.5B	2.2%	2.3%	71.8%
2023	₩52.9B	-₩15B	-₩13.3B	−28.3%	−14.2%	85.0%
2024	₩40.4B	-₩22.1B	-₩17.1B	−54.7%	−22.4%	126.9%
2025	₩54.5B	-₩8.8B	₩40B	−16.2%	34.3%	70.8%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-23

Earnings analysis

Looking at annual results, the company posted revenue of KRW 88.0 billion with operating profit of KRW 2.0 billion and net income of KRW 2.5 billion in 2022, but swung to losses in 2023 as revenue fell to KRW 52.9 billion, producing an operating loss of KRW 15.0 billion and a net loss of KRW 13.3 billion.

In 2024, revenue contracted further to KRW 40.4 billion, the operating loss widened to KRW 22.1 billion, and the net loss reached KRW 17.1 billion, marking the trough of the downturn. In 2025, revenue rebounded to KRW 54.5 billion, yet the operating loss persisted at KRW 8.8 billion.

Net income for that year, however, jumped sharply to KRW 40.0 billion, and the quarterly breakdown shows that fourth-quarter 2025 net income alone reached KRW 49.9 billion, effectively driving the full-year result.

Given that operating profit in that same quarter was only about KRW 0.36 billion, the surge in net income appears to stem from a large non-operating item rather than core operations.

Tracing the quarterly pattern further, operating losses of KRW 2.8 billion in the second quarter of 2025 and KRW 2.0 billion in the third quarter were followed by a return to operating profit of KRW 0.36 billion in the fourth quarter, and the profit margin widened to KRW 0.66 billion in the first quarter of 2026 and KRW 3.0 billion in the second quarter.

Net income of KRW 13.2 billion in the first quarter and KRW 2.8 billion in the second quarter of 2026 shows that positive net income has been sustained without a repeat of the fourth-quarter 2025 scale non-operating item.

This progression suggests gradually improving operating leverage alongside the revenue recovery, though the absolute size of operating profit remains modest.

Industry analysis

The display equipment industry is heavily tied to panel makers' investment cycles, and the broader equipment sector suffered through 2023 and 2024 as domestic Korean investment pulled back. More recently, signs have emerged of renewed large-scale OLED investment by Chinese display makers.

China's second-largest maker, CSOT, is placing roughly KRW 6 trillion worth of equipment orders for the 8.6-generation OLED plant it is building in Guangzhou, and Narae NanoTech has been named alongside ICD, DMS, and Avaco as a potential beneficiary of this order cycle.

Earlier, China's top maker BOE had also placed equipment orders for an 8.6-generation OLED plant in Chengdu, Sichuan, backed by roughly KRW 12 trillion of investment, and Narae NanoTech secured and signed a coating equipment supply contract as part of that project.

Growing adoption of OLED panels in premium IT products such as Apple's iPad Pro is also cited as a factor stimulating related equipment orders.

Meanwhile, the semiconductor panel-level-packaging (PLP) market remains at an early stage, with display equipment makers, including Narae NanoTech, attempting to enter using their existing coating technology.

Across the industry, diversification into semiconductors and batteries has become a common strategy amid recognition that display investment alone offers limited growth.

Outlook

The company has pointed to the expansion of its semiconductor panel-level-packaging (PLP) coating and drying equipment business as the key driver of its earnings improvement, with a company representative stating that extending its display coating expertise into the semiconductor segment has led to quarter-on-quarter improvement in results.

It has said it is collaborating with a Singapore-based firm on PLP process equipment and is also reviewing cooperation with a major Taiwanese OSAT (outsourced semiconductor assembly and test) company, with an eye toward helping establish an industry standard.

In January 2026, the company signed a single sales and supply contract for semiconductor manufacturing equipment worth about KRW 4.3 billion, equal to roughly 10.64% of recent annual revenue.

As of the date its first-quarter 2026 report was compiled, cumulative orders including carryover stood at about KRW 209.2 billion, with an order backlog of about KRW 38.2 billion.

On the display side, as Chinese makers CSOT and BOE continue investing in 8.6-generation OLED lines and Apple continues shifting premium IT products to OLED, a key question is whether the company can convert this order cycle into additional concrete contracts.

No specific, publicly disclosed annual revenue or profit guidance from the company has been confirmed, so future results may remain volatile depending on the timing of quarterly order disclosures and revenue recognition.

Valuation

PER

1.1×

PBR

0.6×

ROE

64.9%

EPS

₩5,820

BPS

₩11,732

Dividend per share

₩0

The current share price trades at a discount to book value per share, placing it in a range where the market appears to value the company conservatively on a net-asset basis.

However, net income over the most recent four quarters includes a large non-operating gain booked in the fourth quarter of 2025, so profitability metrics calculated over that window need to be interpreted with an eye to whether the gain stemmed from core operations or not.

The company has not paid a dividend in recent periods, making dividend-based investment appeal limited. Given the volatility in results over recent years, swinging between losses and modest profits, valuation metrics based on operating profit may offer a more informative trend than those based on net income.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-08-23

Bull factors

Return to Profit After Twelve Quarters, With Margin Expansion

Operating profit of KRW 0.66 billion in the first quarter of 2026 marked a return to profit after twelve consecutive loss-making quarters, and the operating profit expanded to KRW 3.0 billion in the second quarter.

Revenue has also shown a recovery, from KRW 20.2 billion in the second quarter of 2025 to KRW 20.7 billion in the second quarter of 2026, signaling that the low point may have passed.

Sustaining profitability for two consecutive quarters suggests the possibility of a structural improvement rather than a one-off rebound.

Potential Beneficiary of Renewed Chinese OLED Investment

As China's CSOT proceeds with roughly KRW 6 trillion of equipment orders for an 8.6-generation OLED plant and BOE continues its roughly KRW 12 trillion Chengdu plant investment, Narae NanoTech has been cited as a potential beneficiary of this order cycle, given its past coating equipment supply contract with BOE.

Apple's shift toward OLED in premium IT products is also flagged as a factor that could stimulate coating equipment orders. This remains an industry expectation, however, and confirmation of specific new contracts is still needed.

Entry Into Semiconductor PLP Business

The company has extended its coating technology into semiconductor panel-level-packaging (PLP) coating and drying equipment and has begun supplying major overseas customers.

It signed a semiconductor manufacturing equipment supply contract in January 2026, and additional cooperation with a Singapore-based firm and a Taiwanese OSAT company is under review. This could become a potential growth pillar that reduces reliance on the display segment.

Bear factors

High Customer and Segment Concentration

As of the first quarter of 2026, the display segment made up 84.63% of revenue and a single largest customer accounted for 55%, meaning results are directly tied to the ordering timing of specific customers.

Revenue from the semiconductor and new-business segments remains marginal at 0.36% and 0.06% respectively, suggesting it will take time before diversification effects show up meaningfully in results.

Non-Operating Nature of 2025 Net Income

Most of the KRW 40.0 billion in full-year 2025 net income was generated in the fourth quarter, when operating profit was only KRW 0.36 billion.

This suggests the net income surge likely stemmed from a non-operating factor rather than an improvement in core profitability, and net income-based results could decline again if a similar factor does not recur.

Still Modest Absolute Profit Levels

While operating profit expanded to KRW 3.0 billion in the second quarter of 2026, the absolute scale of profit remains modest given the sizable operating losses recorded in 2023 and 2024. If the revenue recovery fails to continue or display orders are delayed again, the return to profitability could prove fragile.

Risk factors

Order Cycle Risk

Display equipment revenue depends on panel makers' large investment decisions, and delays or cancellations in ordering could increase earnings volatility. Chinese makers' OLED investment is still at an early ordering stage, and there is a time lag before actual contracts translate into recognized revenue.

Customer and Revenue Concentration Risk

Dependence on a single largest customer for 55% of revenue means that any reduction in that customer's investment or change in the business relationship could directly affect results. With exports accounting for 89.9% of revenue, the company is also exposed to currency fluctuations and changes in overseas policy.

New Business Execution Risk

New businesses such as semiconductor PLP, battery, and automotive display equipment still account for a small share of revenue and remain at an early stage of validation. There remains a possibility that contracts with overseas companies currently under review for cooperation may not materialize or could be delayed.

What to watch next

Around November 2026 (tentative)
This is the expected timing for the third-quarter 2026 earnings disclosure, when it will be important to check whether the operating profit trend continues from the second quarter and how quickly revenue is recovering.
At the next quarterly report disclosure
Changes in cumulative order value and order backlog in future quarterly reports will show how much of the actual new contract flow from China's CSOT and BOE OLED investment cycle is being captured.
At the time of any semiconductor PLP supply contract disclosure
It will be worth checking whether cooperation with the Singapore-based firm and the Taiwanese OSAT company results in an actual supply contract, and reviewing the scale and terms of any such agreement.
At the time of any follow-up reporting on expanded Apple iPad OLED volumes
It will be important to check whether changes in utilization at panel makers' OLED iPad production lines, such as Samsung Display's, lead to follow-on coating equipment orders.

Overall view

Narae NanoTech appears to be passing through an earnings inflection point, having emerged from the deep losses of 2023 and 2024 to post consecutive operating profits in the first and second quarters of 2026.

However, the large net income booked in 2025 was heavily concentrated in a fourth-quarter non-operating gain, so the pace of the core business's profitability recovery needs to be tracked separately through the operating profit trend.

Revenue remains highly dependent on the display segment and specific customers, while new businesses such as semiconductor and battery equipment remain at an early stage with only a marginal contribution to sales.

The renewed OLED investment by China's CSOT and BOE could provide a favorable order-cycle backdrop, but the timing of actual contract signings and revenue recognition still needs to be observed. The company does not pay a dividend, and its shares trade at a discount to book value.

Going forward, quarterly earnings, order disclosures, and progress on new-business contracts are likely to be the key items to watch in assessing the direction of results.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.