[Click eStock] "L&K Bio, Concerns Eased by US Sales Growth and Full-Scale Expansion"

[Asia Economy Reporter Hyungsoo Park] NH Investment & Securities analyzed on the 23rd that L&K Bio is expected to turn a profit in the third quarter due to increased sales of Expandable Cage.

L&K Bio is a company specializing in the development and manufacturing of spinal implants. It has a full product lineup related to spinal implants, from the cervical spine at the top to the sacrum at the bottom of the spine.

Researcher Koo Wan-sung of NH Investment & Securities explained, "The U.S. market accounts for the majority of the global spinal implant market," adding, "Since research and development costs are reflected in the product unit price, the average selling price (ASP) is more than twice that of other regions."

He continued, "Most of L&K Bio's products have obtained U.S. FDA approval," and added, "Among domestic spinal implant companies, it has most successfully established itself in the U.S. market."

Researcher Koo said, "L&K Bio's trading was suspended from March last year due to an 'unqualified opinion on internal accounting control review,' but trading resumed in May this year," adding, "If it records an operating loss this year after three consecutive years of losses, it may be designated as a management item."

He also analyzed, "Starting with a turnaround in the third quarter of this year, various concerns will be resolved and performance will improve significantly," and noted, "An additional 192,880 convertible bonds are scheduled to be listed on the 23rd."

The remaining convertible shares are 69,974, and Researcher Koo judged that this phase is resolving the overhang (potential pending sell volume) issue.

Researcher Koo introduced, "The cage, a surgical material inserted between discs, has evolved to the third generation of titanium material expandable products," adding, "In the third-generation field, Globus Medical is dominant with sales of $785.36 million and a market capitalization of $4.8 billion."

He continued, "Globus holds a total of nine product approvals," and predicted, "L&K Bio received U.S. approval for three products (XT, XL, XTP) in the second half of last year, and if it obtains approval for three more products this year, it will leap to the second place in terms of product approvals following Globus."