Strong SME 'NBST' Specializing in Anti-Counterfeit Labels Ultimately Enters Rehabilitation Proceedings... Liquidity Crisis Behind Spectacular Growth

Bolstered by the global popularity of K-brands such as K-pop, K-beauty, and K-food, strong SME NBST (CEO Cho In-seok), which had been drawing industry attention for its anti-counterfeit security solutions, has ultimately failed to overcome its liquidity crisis and filed for corporate rehabilitation proceedings with the court. The court has issued a comprehensive injunction to prevent compulsory execution by creditors.

Armed with Unrivaled Technology... Riding High While Leading K-Brand Value Up

Established in 2017, NBST is a specialized security company that has grown rapidly on the back of its genuine certification label 'G-Tag', optimized for preventing forgery and falsification. It applied multi-layer security material technologies such as 'Galaxy' and 'Aurora', whose colors and images change depending on the smartphone flash or the angle of light. By combining IT-based distribution tracking systems (G-Code, G-Check), it successfully established a triple security structure in the market where consumers, distribution managers, and brand companies can all verify authenticity.

In particular, NBST invested aggressively in research and development (R&D). It formed industry-academia-research cooperation with the Korea Research Institute of Chemical Technology (KRICT) and the Ulsan National Institute of Science and Technology (UNIST) to continuously advance its technology, and tackled challenges head-on by establishing a production plant early on in Guangzhou, China, which is considered the largest hotbed for counterfeit goods.

It also expanded its business areas. Beyond cosmetics and K-pop merchandise, it diversified its portfolio into medical devices and various consumer goods, such as the stick-on thermometer 'Pamper Band' supplied for the quarantine of army soldiers. As a result, it was designated as a Government Performance ASSured (G-PASS) company by the Public Procurement Service and as an Export Promising SME by the Ministry of SMEs and Startups, and its innovativeness was recognized externally by winning the '2025 Second Half Digital Innovation Award'.

This competitiveness led to a dazzling increase in performance. The results, which were 7.9 billion won in revenue and 300 million won in operating profit in 2019, jumped steeply to 9.3 billion won in revenue and 1.7 billion won in operating profit in 2021. Up until 2021, its financial structure was solid enough to hold retained earnings of around 2 billion won. To respond to overflowing demand, in early 2024, it signed a contract for a large-scale R&D center and factory site of 2,000 pyeong in the Cheonan Northern BIT Industrial Complex—about five times the size of its existing facilities—aiming for a quantum jump.

Declining Performance and Looming Debt Bills... Ultimately 'Surrendering' to the Liquidity Crisis

However, behind the rosy prospects and massive expansion plans, the shadow of a liquidity crisis was casting deeply. Performance began to decline in 2022, shifting to a deficit with 6.5 billion won in revenue and an operating loss of 560 million won. The deterioration in performance worsened the following year, with revenue halving to 4.3 billion won in 2023 and the operating loss significantly expanding to 1.8 billion won.

The capital soundness, the backbone of the company, also collapsed rapidly. The retained earnings, which exceeded 2 billion won in 2021, completely evaporated within three years, and as of the end of 2024, a deficit of 4.1 billion won was generated, damaging its financial status irreversibly.

The direct catalyst for the rehabilitation filing was the uncontrollably inflated pressure to repay borrowings. Starting in 2023, as the maturities of convertible bonds and long-term borrowings sequentially arrived, current liabilities began to increase rapidly. To make matters worse, interest expenses, which were around 120 million won annually in 2020, surged to 560 million won by the end of 2024, leaving the company facing a severe financial shortage where interest expenses exceeded gross profit.

Arriving at a time when cash-generating capacity had hit rock bottom due to accumulated deficits, the massive debt and snowballing interest choked the company, and it ultimately failed to overcome the short-term liquidity crisis.

Ultimately unable to withstand the accumulated deficits and financial pressure, NBST filed for rehabilitation proceedings with the court. The 3rd Division of the Suwon Rehabilitation Court announced a comprehensive injunction against the debtor, NBST Co., Ltd., as of March 19, 2026.

Following this decision, all rehabilitation creditors and secured creditors of NBST are prohibited from proceeding with compulsory execution, provisional seizure, provisional injunction, and auction procedures based on rehabilitation claims until the final decision on the commencement of the rehabilitation proceedings is made. With a promising strong SME that repeatedly innovated to protect the value of K-brands in the global market now pushed to the edge of a cliff, unable to overcome the wall of financial deterioration, the industry's attention is focused on the court's future decision on the commencement of rehabilitation and the debt restructuring process.