“I’m moving to a big house thanks to you”…ants ‘cheer’ as it surges 343%.

“Thanks to Lunicon (Lunit + Unicorn), I feel like I can move to a bigger house토토사이트.” (Individual investor in Lunit)

Medical artificial intelligence (AI) diagnostics company Lunit’s stock price has been on a tear. Recently, Lunit’s stock discussion boards have been filled with “earnings certificates”. Lunit, which was humiliated by institutional demand forecasts when it listed on the KOSDAQ market last year, is on its way to writing a “reversal story” in about a year.

According to financial information firm F&G, Lunit was the most viewed stock by the ‘buy side’ (entities that directly invest and manage funds) among the stock reports released in the last two weeks from March 18 to 31. A report titled “Still in a Bargain Sale” by Kim Min-jung, a researcher at DS Investment & Securities, is typical. Kim set a target price of 137,000 won, 63% higher than the previous day’s closing price, and issued an investment recommendation of ‘buy’.

As such, Lunit has attracted a lot of attention from institutional investors such as pension funds, insurance companies, and investment managers. However, when it went public, it was ignored. Lunit’s pre-IPO demand forecast for institutions in July last year showed a 7.1 to 1 competition ratio, leading to the company to set its initial public offering price at 30,000 won, 32% below the lower end of the price band (44,000 to 49,000 won).

The slump didn’t last long. Lunit’s stock price, which has been stumbling since its listing, has been trending upwards since October last year. Based on the previous day’s closing price, the stock is up about 181% so far this year. It has surged 343% from its post-listing low of 18,900 won on October 13 last year. As of the previous day’s close, the company’s market capitalization was 1.34 trillion won, making it the first Korean healthcare company to join the “trillion club. Investors have even coined a new phrase, “lunicon,” which combines “unicorn” and “lunit” to refer to startups with an enterprise value of more than 1 trillion won.

What is the background of the sudden reversal of the mood, with stocks that were ignored by institutions rising to the center of the market? It is a combination of various favorable factors, but in the big picture, it is analyzed that ‘mid- to long-term expectations for the AI market’ is the common denominator.

The acceleration of non-face-to-face contact through COVID-19, the development of AI technology, and the aging population have recently focused attention on the digital healthcare industry, and related stocks have risen sharply since the beginning of the year. This is reflected in the observation that the business environment will become easier as the government has announced that it will create a “new regulatory system” and deregulate the innovative medical device market. In addition, Lunit’s core business, ‘diagnostic auxiliary services,’ is relatively free from regulations, which also increased its investment appeal, analysts said.

This is partly due to the market’s favorable assessment of the company’s performance in the global market. Lunit’s business is mainly divided into Lunit Insight, a diagnostic support service, and Lunit Scope, a biomarker for anticancer drugs. Among them, Lunit Insight has partnered with large global imaging diagnostic companies such as GE, Philips, and Holozyme. Han Song-hyeop, a researcher at Daeshin Securities, analyzed, “With 80% of its sales coming from overseas, it can benefit from export support measures.” “With the new government’s deregulation, it is likely that Lunit Insight’s domestic acquisition will be accelerated.”

It’s not just hopes of deregulation and growth that are driving the stock higher. The numbers speak for themselves. In the first quarter of this year, Lunit posted consolidated revenue of 11 billion won. The company posted a loss of 2.3 billion won in operating profit, but the deficit was significantly reduced compared to a loss of 13.4 billion won in the same period last year.

“The company achieved 79% of last year’s total sales of 13.9 billion won in just one quarter,” said Jung Jae-won, a researcher at Shinhan Investment & Securities. “The reason behind the strong performance is the growth of its global business expansion. The number of overseas institutions that have adopted ‘Lunit Insight,’ a major source of revenue, is increasing.” According to the brokerage’s research center, in the three and a half years since Lunit launched the product in 2019, more than 2,000 institutions have adopted it, more than 80% of which are international.

Global index inclusion is also good news for the stock. Lunit was recently added to the Morgan Stanley Capital International (MSCI) Global Small Cap Index. The MSCI is influential because it is tracked by global funds across the globe, so a new addition to the index is usually seen by the market as a good sign for the stock’s supply and demand.

Nvidia, the world’s No. 1 graphics processing unit (GPU) maker, is also benefiting from a surprise earnings report. Earlier, Nvidia said it expected Q2 revenue to reach a record $11 billion, far exceeding Wall Street expectations of $7.2 billion. Nvidia’s stock has soared since the earnings report. It’s up a whopping 180% this year. It also became the first semiconductor company to join the $1 trillion market capitalization club. In the meantime, AI technology utilization companies such as Lunit are being mentioned as Nvidia’s related stocks that have participated in the AI boom early and are reaping significant profits.

Researcher Kim Min-jung said, “Typical drug development companies calculate their enterprise value based on the revenue that will be generated after the drug is released. Lunit also needs to pay attention to its future value,” said Kim. “It is expected that commercial sales of both Lunit Insight and Lunit Scope will be on track by 2027.” “While Lunit’s share price has risen sharply recently, we believe it is still undervalued relative to its global peers,” said Jung.