[Trading Trend] Tentech Preparing for IPO... Chronic Deficits Hidden Behind Top-line Growth, a Thorny Path to KOSDAQ Entry

A red light has turned on for the 2026 listing path of Tentech, an aesthetic equipment specialist that selected NH Investment & Securities as its IPO underwriter in 2021 and has been knocking on the stock market's door for several years. Although it is speeding up its external expansion backed by the popularity of its high-frequency equipment '10THERMA', severe profit volatility, structural deficit trends, and worsening cash flows are continuing. To make matters worse, with a history of receiving a large-scale administrative disposition from the Ministry of Food and Drug Safety (MFDS) and a potential billion-won penalty tied to the listing deadline, there are voices of concern over whether it will be able to easily cross the threshold of the Korea Exchange.

Sales Growth Becoming 'All Show and No Substance'… Profit Rollercoaster

Looking closely at Tentech's annual performance trends, while its top-line figures such as sales are drawing a clear upward curve every year, its actual profit generation capacity is showing a discordant path, revealing extreme volatility and structural deficit limitations.

In 2022, Tentech recorded a decent surplus, generating 11.4 billion won in sales, 1.2 billion won in operating profit, and 1.3 billion won in net profit on a consolidated basis. During the same period, on a separate basis, it seemed to be cruising stably, achieving 11.3 billion won in sales, 1.3 billion won in operating profit, and 1.2 billion won in net profit.

However, in the following year, 2023, despite consolidated sales jumping to 17 billion won, it turned to a deficit, recording an operating loss of 5.2 billion won. Profitability also worsened on a separate basis, incurring an operating loss of 5.3 billion won behind the achievement of 16.8 billion won in sales.

Afterward, in 2024, it achieved 26 billion won in consolidated sales and successfully turned a surplus with an operating profit of 200 million won, but failed to make a full profit recovery, incurring a net loss of 20 million won. At least on a separate basis, it saved face by recording 500 million won in operating profit and 90 million won in net profit.

Most recently in 2025, it turned to a deficit once again. Consolidated sales swelled to 29.2 billion won, but it shifted to a deficit by incurring an operating loss of 1.1 billion won and a net loss of 1.5 billion won again. A profit and loss structure where 'the exterior grows but nothing is left' is emerging ahead of its listing.

Damage to Operating Cash Flow and Snowballing Short-Term Borrowings

This deterioration in profitability is leading directly to a fatal damage in financial soundness indicators. In particular, a state of 'chronic cash outflow' continues, where it fails to generate cash through its own operating activities.

Tentech's operating cash flow recorded minus (-) 6.2 billion won in 2023, followed by -100 million won in 2024 and -3.1 billion won in 2025, marking three consecutive years of cash leaking outward. With cash not circulating inside the company, a vicious cycle is repeating where it entirely relies on external borrowings for its insufficient operating funds. In fact, Tentech's consolidated short-term borrowings were around 4.5 billion won at the end of 2024, but as the financial difficulties worsened, the figure skyrocketed to 8.4 billion won by the end of 2025, nearly doubling in just one year. Due to this, the debt ratio rose from 87.8% to 132.9% during the same period.

The simultaneous insolvency of major overseas subsidiaries ambitiously established to target foreign markets is also lowering the fundamentals. The Chinese subsidiary, Shandong Tentech, and the Japanese subsidiary, Tentech Japan, both fell into a state of 'complete capital impairment' as they continued to post net losses throughout 2024 and 2025. With the ongoing insolvency of its subsidiaries, Tentech had to recognize about 600 million won in impairment losses on investments in subsidiaries as a lump-sum expense in 2025 alone on its separate financial statements.

6-Month Manufacturing Suspension and a 1.28 Billion Won 'Penalty Bomb' Ticking Away

Above all, the most painful aspect of Tentech's attempt to list on the KOSDAQ in 2026 is the compliance issue and the massive penalty risk derived from it.

Tentech received an administrative disposition of a 'complete suspension of manufacturing operations' from the MFDS for violating the Medical Device Act for a long period of six months, from August 10, 2024, to February 9, 2025. For a company whose main focus is medical devices, a half-year manufacturing suspension is not only a business blow but also a point that could be evaluated as a question mark regarding management transparency and the soundness of its internal control system during the future preliminary listing review process by the Korea Exchange.

Additionally, it has been confirmed that there is a history of a massive penalty claim from an investment association, as the 'representations and warranties' clause in the Share Purchase Agreement (SPA) signed with the investment association during a past paid-in capital increase was directly violated due to this manufacturing suspension disposition.

The company hurriedly entered into a separate agreement with the investors and has barely suspended this penalty claim by setting the condition of 'completing the KOSDAQ listing within the year 2026'. However, if it fails to list by not passing the exchange's screening threshold, there is a latent issue where penalty claims totaling 1.2 billion won could pour in all at once, adding the approximately 900 million won share of other institutional investors with the same reason on top of the approximately 300 million won payable to the respective investment association.

According to the VC industry recently, E&Investment executed a project investment to acquire Tentech's old shares at 6,132 won per share (an enterprise value of about 125 billion won), and entering 2026, consistent trading has been occurring in the over-the-counter market in the range of 8,500 to 9,000 won, indicating that market interest betting on Tentech's product potential itself remains valid.

However, the dominant pointing out is that it is highly ambiguous to dispel all at once the limitations of the financial 'quantitative requirements' such as damaged cash flows and increased borrowings, along with the flaws in the 'qualitative requirements' like the history of manufacturing suspension dispositions and the massive penalty risk that will erupt upon listing failure. Market attention is focused on whether Tentech, which has drawn a line in the sand for a 2026 KOSDAQ entry, will be able to break through the deeply piled unfavorable factors and safely land in the stock market.