Tego Science Issues 27 Billion Won Convertible Bonds for Clinical Funding But Faces Dilution Risk as Stock Price Falls Below Conversion Price

Tego Science issued 27 billion won in unregistered private convertible bonds in May 2025 to secure funds for R&D and domestic and international clinical trials.
The conversion price is 17,713 won, significantly higher than the current stock price of 6,900 won, making conversion unlikely. However, if converted, 1,524,304 shares representing 18.8% of total outstanding shares would be issued, posing dilution risk.
Additionally, the company granted a call option to a third party designated by the issuer, allowing acquisition of up to 609,722 shares, further potential dilution.
The company holds 102,268 treasury shares, equivalent to 1.3% of outstanding shares, but has no plans to dispose or cancel them.
On a consolidated basis, the debt ratio surged from 5.7% in the prior year to 55.3% due to the bond issuance, and the company recorded a net loss of 7 billion won, increasing financial burden.
The raised funds remain unused in short-term financial instruments, indicating a time lag before deployment into clinical trials.
[AI Summary]Tego Science secured R&D funding through a large convertible bond issuance, but the low stock price relative to the conversion price reduces dilution risk. However, high debt and operating losses persist. The performance of clinical investments will be a key factor for the stock price.