[Click e-Stock] "Alteogen's Market Cap Could Reach 30 Trillion Won with KOSPI Transfer"

On July 8, Hana Securities projected that if Alteogen moves its listing from KOSDAQ to the Korea Exchange (KOSPI) as requested by its second-largest shareholder, its market capitalization could reach over 30 trillion won. This figure is about 8 trillion won higher than its closing market cap of 22.2949 trillion won as of the previous day. Hana Securities raised its target price from 440,000 won to 550,000 won.

Previously, on July 7, Hyung Inwoo, CEO of Smart & Growth and the second-largest shareholder of Alteogen, stated on his blog that: ▲ listing on KOSPI could attract large-scale passive funds that track the KOSPI index to invest in Alteogen; ▲ with the resumption of short selling in March this year, when the KOSDAQ market as a whole is being shorted, it is possible to defend against share price declines more efficiently on KOSPI due to the relative shortage of funds operating in KOSDAQ; ▲ as Alteogen is the top market cap company on KOSDAQ and the gap with the second-ranked company (EcoPro BM) exceeds 10 trillion won; and ▲ considering that Alteogen is expected to generate annual operating profits of several hundred billion won from 2025 to 2026, there are no comparable companies on KOSDAQ to benchmark Alteogen’s performance, which could lead to a disadvantage in valuation. For these reasons, he demanded the company move its listing from KOSDAQ to KOSPI. As of the latest data, Hyung Inwoo and his spouse hold 2.86 million shares, representing 5.31% of the total shares outstanding.

Hana Securities stated in its report that day, "The second-largest shareholder’s request for a KOSPI listing is expected to be realized after the approval of Keytruda SC." Alteogen supplies ALT-B4, which converts Merck’s blockbuster anti-cancer drug Keytruda from an intravenous (IV) formulation to a subcutaneous (SC) formulation, to the global pharmaceutical company Merck. Competitor Halozyme has filed a lawsuit claiming that Merck infringed its hyaluronidase (MDASE) patent, and Merck has responded by filing a post-grant review (PGR) to invalidate Halozyme’s patent. The stock market expects a favorable outcome for Merck.

Hana Securities analyzed that, based on Halozyme’s past case, Alteogen could generate quarterly operating profits of several hundred billion won from royalty income, with an operating margin exceeding 50% per quarter. The patent for Alteogen’s main product, ALT-B4, is valid until 2039 (and is expected to be extended to early 2042 if all PTA, PTE, and other extension conditions are applied), leaving ample time for ALT-B4 to be monetized.

Kim Seona, an analyst at Hana Securities, commented, "If there is a market that can absorb Alteogen’s market capitalization, considering Halozyme’s business model and Samsung Biologics’ EBITDA and multiples, we can expect a market cap of over 30 trillion won at present."