As Shin Ramyun and Buldak spicy ramyeon have recently formed a two-top structure in the ramyeon market, OTOKI has moved to build a new plant in Anyang and begun reorganizing its business. In the industry, the mood is that OTOKI, whose growth momentum is relatively weak, is seen as seeking a new breakthrough. It reads as a strategy to expand the business portfolio with a focus on home meal replacements (HMR) and sauces.
According to the Financial Supervisory Service's electronic disclosure system on Apr. 6, OTOKI recently disclosed a "plan to enhance corporate value." The plan presented as key strategies ▲ completion of the new Anyang plant and a U.S. local plant in 2027 ▲ strengthening research and development (R&D) for new products and sales activities at home and abroad ▲ expanding overseas sales focused on the United States and Southeast Asia ▲ establishing a mid- to long-term policy on dividends. Among these, construction of the new Anyang plant is cited as a key pillar that can both restructure production bases and indicate the future direction of the business.
The current ramyeon market structure is effectively locked in. In Korea, Nongshim's Shin Ramyun has long held the No. 1 spot, while overseas, Samyang Foods' Buldak spicy ramyeon has established itself as a global hit. The assessment is that it is structurally difficult for OTOKI to compete on ramyeon alone.
In fact, OTOKI's sales last year were 3.6745 trillion won, up 3.8% from the previous year, but operating profit fell for a third straight year to 177.3 billion won. Net profit also fell to 72.1 billion won, about half the level of the year before. With rising costs and increased selling, general and administrative expenses overlapping, the top line grew but profitability weakened.
In this situation, the industry interprets OTOKI's construction of the new Anyang plant not as a simple capacity increase, but as an investment aimed at a "change in production method." The plan is to design it as an "urban-type plant" to respond to demand in the Seoul metropolitan area and quickly produce and supply small-volume products such as HMR and sauces, for which demand is relatively high in the region.
A food industry official said, "Ramyeon is centered on mass production, but HMR and sauces are items that must respond quickly to changing trends," adding, "The intention is to build a small-lot, multi-item production system near the Seoul metropolitan area."
This change in the production system also aligns with the strategy to expand the business portfolio. OTOKI is expanding its product lineup with a focus on HMR and sauces in addition to items with high market share such as curry, 3-minute ready meals, and sesame oil. A representative example is strengthening the frozen and ready-to-eat lineup under its own brand "Oz Kitchen." In the industry, this is seen as a move to gradually increase the share of non-ramyeon businesses.
An OTOKI official said, "It is true that ramyeon has a large share on a single-item basis, but ramyeon accounts for about 30% of total sales," adding, "We operate our portfolio based on a diverse range of products such as curry, ketchup, and mayonnaise."
Currently, OTOKI is pushing to strengthen its domestic production responsiveness through the Anyang plant and to expand its overseas production bases, including building a plant in California in the United States. At home, it aims to boost responsiveness for products such as HMR and sauces through an urban-type plant, while abroad, it seeks to expand the market through local production. In the industry, this is seen as a strategy to simultaneously pursue product responsiveness and market expansion through a "dual production base" centered on the domestic Anyang plant and the U.S. production base.
A food industry official said, "It is a natural trend for food companies to target small-volume products such as HMR and sauces or to expand into overseas markets," while noting, "The investment effect will also begin in earnest only if they deliver results in new product lines and categories."
Seo Yong-gu, a professor in the School of Business at Sookmyung Women's University, said, "It is time to secure a new growth engine like the success case that shook the market, such as Samyang Foods' Buldak spicy ramyeon," adding, "As the domestic market has entered a low-growth phase, what matters is whether they can roll out a 'hit product' in the HMR and sauce markets and overseas."