Key Takeaways
- KT&G is developing a smokeless nicotine product absorbed through the mouth and is preparing a pilot production line.
- The pilot equipment will be supplied by Korean battery and display equipment company PNT.
- This is the first confirmed case of KT&G building related production facilities in South Korea.
- KT&G said the business is still in the early development stage, and launch plans for nicotine pouches and other products have not been finalized.
- The report said nicotine pouches do not currently have formal sales authorization in South Korea, and consumers mainly buy them through overseas direct purchases or unofficial channels.
2Firsts, April 8, 2026
According to a Korean media report, KT&G is moving forward with a smokeless nicotine product business that delivers nicotine through oral absorption rather than combustion, and is preparing a pilot production line for research and development.
KT&G is developing an oral smokeless nicotine product
The report said KT&G is developing a smokeless nicotine product designed for oral nicotine absorption, and that the pilot production equipment will be supplied by battery and display equipment company PNT. This is also the first confirmed case of KT&G building related production facilities in South Korea.
KT&G said the business remains at an early stage of development and that no final decisions have been made. The company added that it has long been preparing next-generation tobacco product categories and is reviewing a range of products beyond e-cigarettes and vapor products, including nicotine pouches, but that neither domestic nor overseas launches have been specified.
Nicotine pouches are described as a representative oral nicotine format
The report said nicotine pouches are a representative product in the oral nicotine category. They are placed between the gum and the lip, allowing nicotine to be absorbed through the oral mucosa without combustion. KT&G previously showed interest in entering the category by participating last year in the acquisition of a European nicotine pouch company.
According to the report, the manufacturing process for nicotine pouches differs from that of traditional cigarettes. It involves measuring and mixing nicotine, fillers, and flavorings, followed by granulation and drying, before a fixed amount is filled into small pouches. A key part of the process is designing the filler so that nicotine is released at a controlled rate when it contacts saliva.
PNT will supply pilot equipment, while domestic rollout still depends on Korean regulation
The report said this production process shares some similarities with battery manufacturing, including continuous processes such as mixing, coating, drying, and transferring, and that such production can be implemented through roll-to-roll technology. PNT is a Korean company known for its strength in roll-to-roll technology. While about 90.00% of its business is tied to battery equipment, it also provides roll-to-roll process solutions to industries such as pharmaceuticals and medical equipment.
The report said the cooperation with KT&G could also mark PNT’s entry into new sectors such as food, healthcare, and consumer goods, and that if KT&G moves into commercialization, the partnership could later lead to mass-production equipment orders.
Global nicotine pouch competition is intensifying and KT&G has already joined overseas M&A activity
The report said competition in the global tobacco market is intensifying around nicotine pouches. Philip Morris International owns the Zyn nicotine pouch brand, which holds a 74.00% share of the U.S. market. British American Tobacco is targeting Europe and the United States with its Velo brand.
The report also said this shift is already being reflected in performance. Philip Morris’ smoke-free business now accounts for more than 40.00% of total revenue. Nicotine pouch shipment volume reached 196.00 million cans in the fourth quarter of 2025, up 19.00% year on year, while cigarette sales fell 1.50% over the same period.
KT&G is also preparing to enter the market. The report said the company last year participated with U.S. tobacco company Altria in the acquisition of Swedish and Norwegian nicotine pouch companies ASF AB and ASF AS. The acquisition amount was about SEK 1.76 billion (approximately USD 40.50 million, based on 1 SEK ≈ 0.023 USD), in a deal valued at about KRW 270.00 billion.
Domestic sales in South Korea still depend on regulatory changes
The report said KT&G’s oral nicotine business is aligned with the broader global market expansion trend, but that in South Korea the speed of progress will depend on whether the legal and regulatory framework is revised. Under Korea’s Tobacco Business Act, nicotine pouches may only be sold by authorized businesses. The report said there is currently no formal sales authorization, and consumers are purchasing these products mainly through overseas direct purchases or unofficial channels.
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