Can Rainbow Dreaming of Boston Dynamics Achieve Its Dream on KOSDAQ?

[Asia Economy Reporter Park Hyungsoo] Rainbow Robotics, a research team that developed Korea's first humanoid bipedal robot ‘Hubo (HUBO)’, is set to be listed on the KOSDAQ market next month.

Expectations for the growth potential of walking robots have increased as Hyundai Motor Group acquired Boston Dynamics to strengthen its future capabilities. Rainbow Robotics, with a public offering price range bottom line of about 100 billion KRW, is attracting attention in this year's IPO market.

According to the Financial Supervisory Service on the 19th, Rainbow Robotics plans to offer 2.65 million shares for its initial public offering (IPO). The expected public offering price is 7,000 to 9,000 KRW per share, with a total offering amount ranging from 18.6 billion to 23.9 billion KRW. After conducting demand forecasting targeting institutional investors, the public offering price will be finalized. Subscription for general investors will be held from the 25th to the 26th, and the company will be listed on the KOSDAQ market on the 3rd of next month. The lead underwriters are Mirae Asset Daewoo and Daishin Securities.

Rainbow Robotics, founded in 2011 by Professor Oh Junho, a distinguished professor at the Korea Advanced Institute of Science and Technology (KAIST), is a robotics platform specialist developing bipedal robots, quadrupedal robots, collaborative robots, and astronomical mount systems. Professor Oh, who developed the humanoid robot Hubo, serves as the Chief Technology Officer (CTO) of Rainbow Robotics.

Rainbow Robotics has supplied its developed bipedal robots to numerous domestic and international research institutions, universities, and companies, including the Massachusetts Institute of Technology (MIT), Google, and the U.S. Naval Research Laboratory. The company’s technology was validated by winning a competition hosted by the U.S. Defense Advanced Research Projects Agency (DARPA) in 2015.

Rainbow Robotics ranks among the top five in the field of bipedal robot technology. Boston Dynamics, recognized for its world-class technology, was acquired by Hyundai Motor Group last month for 880 million USD.

Boston Dynamics developed the quadrupedal robot ‘BigDog’ in 2005 with 10 million USD funding from DARPA, an advanced research agency under the U.S. Department of Defense. BigDog is expected to transport defense supplies in rough terrains or hazardous areas where vehicles have difficulty operating.

Kim Minseon, a researcher at Kiwoom Securities, explained, "Hyundai Motor Group has a strong foundation in finished vehicles, parts manufacturing, and logistics, so the utilization of humanoid robots will be high. Synergy effects can be expected between Boston Dynamics’ technology and Hyundai Motor Group’s autonomous vehicle perception technology development."

With Hyundai Motor Group’s acquisition of Boston Dynamics, interest in the growth potential of the walking robot market has increased. Although Rainbow Robotics’ sales scale is small and it has yet to escape losses, its growth potential is recognized. As of the third quarter of last year, cumulative sales reached 3.8 billion KRW, with an operating loss of 840 million KRW. Rainbow Robotics expects its sales to exceed 10 billion KRW this year and to turn operating profit positive.

The funds raised through the IPO will be used to expand automated production facilities. The company plans to invest 7.2 billion KRW to build a manufacturing plant capable of producing 2,000 collaborative robots, 10 bipedal robots, 30 quadrupedal robots, 200 beverage robots, 50 disaster site rescue robots, and 300 precision orientation mounts. Additionally, 7 billion KRW will be allocated for research and development to develop core components and improve the completeness of bipedal walking technology.

Since 2017, Rainbow Robotics has been enhancing its core technologies with government support to surpass Boston Dynamics’ technological capabilities.