Robotis Hits All-Time High Ahead of Physical Spin-Off... Benefits from Humanoid Robot Boom

Stock Price Declined After March 18 Physical Spin-off Decision
Foreign Investors Seized the Buying Opportunity
Share Price Rebounded on Expectations for Actuator Division Growth

Robotis has once again set a new all-time high. As the humanoid robot market expands, there are growing expectations that Robotis, which manufactures actuators considered key components, will also experience concurrent growth.

According to the financial investment industry on May 21, Robotis’s share price rose by 52.3% over the two months since March 18. During the same period, the KOSDAQ index fell by 3.8%.

Foreign investors have driven the stock price up by purchasing 46.1 billion KRW worth of Robotis shares over the past month. The average purchase price per share for foreign investors was 48,529 KRW, resulting in an evaluated return of 27.1%.

Robotis produces the actuator 'Dynamixel,' which integrates functions such as motors, reducers, controllers, and communication required for robot joints and mobility devices into a single module. Robotis, which also develops autonomous robots, held a board meeting on March 18 and resolved to proceed with a physical spin-off. The company decided to establish Roboitz by separating the autonomous robot business division.

This decision was made in consideration of the fact that although revenue is generated from the actuator business division, a significant portion of development costs is concentrated in the autonomous robot division. By establishing a new company through a simple physical spin-off, it is expected that the actuator division will be able to turn a profit. The newly established Roboitz plans to attract investment capital needed for research and development and to cultivate an image suitable for B2C (business-to-consumer) services.

Due to the strong negative perception of physical spin-offs in the domestic stock market, Robotis’s share price, which had been above 40,000 KRW, fell to around 29,000 KRW.

Stock market experts advised that the price decline was excessive, given that the core business division remained within the existing company, and suggested that this was a buying opportunity. Jo Eunae, a researcher at LS Securities, stated, "The main business is the actuator division, and since the physical spin-off of the autonomous robot division has little impact on fundamentals, the sharp price drop presents a good investment opportunity," adding, "We expect Robotis actuators to benefit from the growth of the global humanoid robot industry."

The stock price, which began to rebound in mid-April, has surged sharply this month. The expectation of benefiting from the growth of the humanoid robot market has started to be reflected in the share price. First-quarter earnings also helped stimulate investor sentiment. In the first quarter of this year, Robotis recorded consolidated sales of 10.2 billion KRW and an operating profit of 800 million KRW. Compared to the same period last year, sales increased by 22.6%, and operating profit turned positive. Choi Jaeho, a researcher at Hana Securities, commented, "The turnaround to profitability happened faster than expected," and explained, "Growth in actuator exports was driven by increased demand from overseas clients and the acquisition of new customers."

Kim Seongrae, a researcher at Hanwha Investment & Securities, said, "Robotis’s actuators proved their technological prowess by being used as core components in the 'Aloha Project,' which proposed a methodology for robot development based on imitation learning," and predicted, "With the physical spin-off of the autonomous robot division, which has been running at a loss due to high development costs, profitability centered on the actuator business will improve more rapidly."

Previously, starting in November last year, Robotis has been collaborating with the Massachusetts Institute of Technology (MIT) to develop advanced robot technology based on physical artificial intelligence (AI). Physical AI refers to technology that enables robots to replicate precise physical force like humans, and it has recently become a focal point in the robotics industry. Last month, Robotis launched the humanoid robot 'AI Walker' based on physical AI and made its first delivery to LG Electronics. LG Electronics, the second-largest shareholder of Robotis, is developing a household humanoid robot. Robotis is expected to supply actuators and manipulators for this project.