[Click eStock] "Kyungdong Navien Resumes Gas Boiler Supply in China"

[Asia Economy Reporter Hyungsoo Park] ResearchAlum predicted on the 10th that Kyungdong Navien will benefit from the surge in demand for gas boilers in China.

Researcher Jaeyoung Lee of ResearchAlum explained, "In 2017, when the Chinese government placed the largest orders for gas boilers, Kyungdong Navien's gas boiler sales in China were around 130,000 to 140,000 units."

He added, "It is estimated that there were orders of about 3 million units annually," and "from 2018 to 2019, orders decreased to around 2 million units, leading to a decline in Kyungdong Navien's sales in China."

This year, demand for gas boilers in China is expected to recover to the 2017 level. The researcher emphasized, "The project was delayed due to a shortage of natural gas supply in China," and "the pipeline for importing Russian natural gas was completed last December."

Furthermore, he analyzed, "Kyungdong Navien expanded its factory in 2018 to produce 300,000 gas boilers annually," and "all trial operations were completed last year, and full-scale operations will begin this year."

Domestically, from April, condensing boilers will be mandatorily distributed in four regions nationwide. Condensing boilers have a sales price 50% to 120% higher than regular gas boilers. The domestic penetration rate of condensing boilers is only about 25%.

It is estimated that this year’s consolidated financial statements will show sales of 894.6 billion KRW, a 15.1% increase from the previous year, and operating profit of 55.5 billion KRW, a 38.3% increase.