Blue Orca-持有 DN 汽车集团多头头寸（英）

1THIS RESEARCH REPORT EXPRESSES SOLELY OUR OPINIONS. We are biased. So are all investors. So is DN Automotive. So are the banks that raised money for the Company. If you are invested in DN Automotive, so are you. Just because we are biased does not mean that we are wrong. Use BOC Texas, LLC’s research opinions at your own risk. This report and its contents are not intended to be and do not constitute or contain any financial product advice. Investors should seek their own financial, legal and tax advice in respect of any decision regarding any securities discussed herein You should do your own research and due diligence before making any investment decisions, including with respect to the securities discussed herein. We have a long position in DN Automotive’s securities and therefore stand to realize significant gains in the event that the price of such securities appreciates. Please refer to our full disclaimer located on the last page of this report. We think the Korean stock market is the next Asian powerhouse. Korea has a surplus of publicly traded small to mid-cap companies that, despite positive trends in corporate governance and solid if unspectacular competitive advantages, do not receive the attention and interest they deserve from global investors. Although there is high domestic market participation, particularly among enthusiastic retail investors, global investors, especially in the United States, are largely unaware of the critical mass of impressive companies often trading at excessively low valuations. The Korean market can be difficult to trade, and because many company filings and press releases are only issued in Korean, several fantastic opportunities pass by unnoticed. We believe we have discovered one such hidden gem. We are long DN Automotive Corporation (“DN Automotive” or the “Company”), a Korean manufacturer specializing in vehicle vibration management systems (“VMS”) and machine tools. Despite robust underlying cash flows and improving margins, the Company languishes at a depressed valuation of 3.1x TTM P/E, in part due to the cyclical headwinds in the automotive supply and machine tools industries and in part due to a lack of awareness of its under-the-radar business. This is about to change. DN Automotive is in the process of spinning off subsidiary DN Solutions, Korea’s largest producer of machine tools, in an IPO on the Korean stock exchange, expected in May 2025. Early indications are that the IPO will value the Company’s machine tools division at a valuation up to 2x the current enterprise value of entire business. Not only would this be a substantial premium to DN Automotive’s current valuation, but investors would get a free option on the Company’s robust automotive parts business. Ultimately, we believe that the forthcoming IPO of the Company’s machine tools division offers investors a unique opportunity with 3-4x upside on a near term, defined catalyst. 1. DN Automotive’s Upcoming Spinoff of Machine Tool