[Biz Leader] Kang Deokhyun, CEO of RS Automation: "Meeting Global Demand by Internalizing Core Physical AI Technologies"

The Only Company in Korea to Internalize a Physical AI-Based Motion Control Full Stack
Strengthening R&D and Production Capacity to Match Expanding Downstream Markets

Kang Deokhyun, CEO of RS Automation. Provided by RS Automation

"RS Automation is transforming from a simple manufacturing company into a 'Physical AI platform specialist.' The company is now fully prepared to ride the explosive growth wave of its downstream industries."

Kang Deokhyun, CEO of RS Automation, shared this perspective on the company's current situation during an interview with The Asia Business Daily on the 27th.

RS Automation develops and supplies core components and control solutions for robots and smart factories using its proprietary Physical AI technology. Its main business areas include motion control, sensors, Physical AI platforms, and power control solutions.

The company has established a 'motion control full stack' by vertically integrating controllers, servo drives, encoders, and smart tuning software with its own technology. Recently, it has been working on developing an integrated drive module (smart actuator) that combines motors, drives, encoders, and AI algorithms. This technology is gaining attention as a key component in industries that require high-precision control, such as humanoids and defense robots.

CEO Kang stated, "RS Automation's greatest strength is that it is the only company in Korea to have internalized the 'Physical AI-based motion control full stack.' We can provide an integrated supply from the upper-level controller to the servo drive, motor, and sensors, allowing us to optimize product performance, cost, delivery, and customization."

The company's main downstream industries are humanoid robots and smart manufacturing, defense, and AI data center power infrastructure. Recently, these sectors have entered a phase where the commercialization of Physical AI and humanoids, as well as the rapid growth of data center power infrastructure, are occurring simultaneously. The expansion of downstream demand is expected to drive RS Automation's mid- to long-term revenue growth.

He added, "RS Automation is strengthening its position as a supplier of robot bodies and drive systems in the humanoid and defense sectors, and as a key module supplier for power infrastructure in the data center sector, by offering a package of full-stack motion control, sensor localization, and power control."

RS Automation is currently conducting a rights offering to raise approximately 40 billion won. The funds will be allocated as follows: 45% (about 18 billion won) for R&D, 20% (8 billion won) for facility investment, 19.9% (about 7.9 billion won) for working capital, and 15.1% (6 billion won) for debt repayment. This is not just simple fundraising, but a strategic investment aimed at expanding the market with a focus on Physical AI and humanoids.

First, R&D will focus on developing an AI control software platform, edge computing-based drives, and on-machine and humanoid drive modules. Facility investment will be used to expand production capacity, strengthen cybersecurity infrastructure, and improve production efficiency. Working capital will be used to accelerate global expansion, including expanding operations at the Americas subsidiary.

After the rights offering, the key point to watch for RS Automation is the 'expansion of global strategic partnerships.' Since 2022, RS Automation has been jointly developing next-generation smart motor controllers (SMCs) with Rockwell Automation, the top industrial automation company in the United States, under a five-year, 63 billion won supply contract. The company has recently been recognized by global clients for its top-level security and reliability, and upon commercialization, the overseas sales ratio is expected to rise from the current 40% to over 60%.

Additionally, the commercialization of integrated drive modules for humanoids is also anticipated. CEO Kang said, "If the integrated drive module is commercialized in 2027, there is a high possibility that we will become a key component supplier in the humanoid industry. In particular, the integrated drive module with capacitive encoders, servo drives, and frameless motors is being designed as the 'standard joint drive unit' for defense robots, which aligns with the government's vision of becoming the number one nation in Physical AI, so we expect to benefit from this."

He further stated, "In the defense sector, mass production of domestically developed capacitive encoders is entering full swing, and in the data center sector, sales of power control devices are expected to continue growing. RS Automation aims to quadruple its overseas sales in North America, Europe, India, and other regions by 2030, utilizing the funds secured through this rights offering."