[Click e-Stock] "Osang Healthcare Expected to Transform into a Healthcare Platform Company"

On June 10, KB Securities analyzed that Osang Healthcare is expected to transform into a healthcare platform company based on its diagnostic kits. The firm did not provide an investment opinion or target price.

Founded in 1996, Osang Healthcare operates in various in vitro diagnostic medical device businesses, including biochemical diagnostics, molecular diagnostics, and immunodiagnostics. Its main diagnostic products include personal blood glucose meters, HbA1c analyzers, COVID-19 diagnostic kits, and influenza diagnostic kits.

In the first quarter, Osang Healthcare recorded sales of 32.1 billion KRW and operating profit of 4.1 billion KRW. Compared to the same period last year, sales increased by 55.3%, and the company turned to an operating profit. Lim Sangguk, a researcher at KB Securities, stated, "Exports of combo kits that can simultaneously diagnose COVID-19 and influenza A&B were the main driver of strong performance," adding, "This is expected to lead to further growth this year."

The development of continuous glucose monitoring (CGM) devices is expected to serve as the next growth momentum. He explained, "Unlike personal blood glucose meters, CGMs are digital glucose monitors that attach sensors to the abdomen or upper arm to analyze blood glucose trends and patterns," and emphasized, "If future technological advancements, generative AI, and telemedicine are combined, the application could expand beyond diabetes patients to other diseases, marking the beginning of a revolutionary paradigm shift in the healthcare market."

He continued, "Combo kits capable of simultaneously diagnosing COVID-19 and influenza A&B are expected to drive performance growth for several years," and added, "Considering price competitiveness, US-China relations, and the opportunity costs associated with top-tier global medical device company A's in-house development, Osang Healthcare's exclusive sales rights in the US are expected to continue for the time being."

He further explained, "The fact that the company continues to invest in research and development and capacity expansion to secure future growth, rather than relying solely on one-off special results from COVID-19, differentiates it as a competitive strength compared to other domestic competitors."