Interview with Kang Junmo, CEO of ADM Korea
Scheduled KOSDAQ Listing in Early June... Aggressive Expansion into Asian Markets
[Asia Economy Reporter Minwoo Lee] "We will actively target the Asian market with industry-leading solidity."
This is the ambition of Kang Junmo, CEO of ADM Korea, ahead of the company's upcoming listing on the KOSDAQ market next month. The plan is to leverage the capabilities that have established ADM Korea as the top clinical research organization (CRO) in South Korea and expand them into overseas markets. CEO Kang emphasized, "ADM Korea is the first purely domestically capitalized CRO company to announce its intention to go public. We plan to aggressively target domestic and international companies aiming to enter the East Asian market and establish ourselves as a global CRO company."
CEO Kang cited the company's solid internal foundation as ADM Korea's strength. Last year, the current ratio on a separate basis was 344.7%, more than double the industry average of 126.0%. The current ratio is calculated by dividing a company's 'current assets' that can be converted to cash within one year by its 'current liabilities' due within one year. Generally, a current ratio above 150% is considered financially stable. Based on debt-free management, the company also secured approximately 14.7 billion KRW in retained earnings. CEO Kang explained, "The CRO business is a type of service business with a high proportion of labor costs. If price competition occurs in a 'dumping' manner with similar workforce sizes, sales and other external growth may occur, but the company's internal solidity is difficult to maintain. We have consistently competed solely on quality, which has allowed us to gain both trust from major clients and financial stability."
The company's performance is also on a smooth trajectory. Last year's sales reached 13.1 billion KRW, an increase of about 28.6% from 10.2 billion KRW the previous year. Of this, sales to the top 10 domestic pharmaceutical companies accounted for 42%, reflecting strong industry trust. During the same period, operating profit surged more than fourfold from 850 million KRW to 3.53 billion KRW. The operating profit margin also jumped from 8.3% to 26.9%.
Following the capital raised through this listing, the company plans to actively target overseas markets. The Asian market, which has been prepared early on, is the top priority. In China and Japan, ADM Korea formed collaborations with companies ranked 3rd to 4th in their respective industries as early as 2015. In 2019, the company incorporated Vietnam's top CRO as an affiliate through equity acquisition and also established a branch in Thailand. Starting this year, ADM Korea plans to build clinical trial infrastructure in 10 Asian regions including India, the Philippines, and Singapore over the next three years. CEO Kang stated, "South Korea ranks 8th globally and 2nd in Asia in clinical competitiveness, with Seoul ranked 1st among cities, reflecting our rising status. We will expand our presence by meeting the demand of domestic and overseas pharmaceutical companies from the US and Europe aiming to enter Asia, leveraging the competitiveness we have built in the domestic market."
Meanwhile, ADM Korea plans to conduct institutional investor demand forecasting on the 17th and 18th, followed by a general subscription period from the 25th to the 26th. The company will then be listed on the KOSDAQ market early next month. The expected public offering price range is 2,900 KRW to 3,300 KRW, with the anticipated amount to be raised between 13.05 billion KRW and 14.85 billion KRW. Hana Financial Investment is the lead underwriter.
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