Expectations for Increased Demand in Indoor Activities Like Online Delivery as People Refrain from Outdoor Activities
[Asia Economy Reporter Minwoo Lee] As fear of the Chinese "Wuhan pneumonia (novel coronavirus)" spreads, corrugated cardboard and game-related stocks are showing strength unexpectedly. This is due to expectations that outdoor activities will decrease amid infection concerns, while online delivery and shopping will become more active.
According to the Korea Exchange on the 23rd, Shindaeyang Paper, which produces packaging materials, recorded its highest price in three months at 71,800 won in early trading. As of 9:30 a.m., it maintained the mid-69,000 won range. After hitting the lowest price of 55,700 won three months ago in November last year and hovering around the 50,000 won range, the stock price surged more than 20% from the 21st. As of 11 a.m., packaging company Seungil was trading at 122,000 won, up 19.51% from the previous day.
The spread of fear over Wuhan pneumonia appears to reflect expectations that, as during the past "MERS (Middle East Respiratory Syndrome)" outbreak, people will refrain from outdoor activities. Instead of going outside, the demand for online delivery boxes has surged, attracting investors' attention to corrugated cardboard manufacturers.
Other industries related to indoor activities are also being affected by this atmosphere. Household goods are representative. Mask manufacturer Monalisa hit the upper limit price the previous day. At 9:20 a.m. on the same day, it was trading at 6,850 won, up 14.72% from the previous day. It once recorded a 52-week high of 7,180 won.
There is also a forecast that game stocks could benefit. This is based on expectations that more people will enjoy games indoors rather than outdoor activities. Wemade (7.16%), Pearl Abyss (4.15%), and Webzen (2.51%) are showing upward trends.
Choi Seonghwan, CEO of Research Allem, said, "As the fear of Wuhan pneumonia grows to the extent that the World Health Organization (WHO) is paying attention, concerns about outdoor activities are increasing," adding, "Along with the surge in online delivery demand and the decline in raw material prices, the strength of the corrugated cardboard sector is expected to continue for the time being."
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