[Click eStock] "Pungsan, Copper Price Increase and Demand Improvement Positive for Q3 Earnings"

[Asia Economy Reporter Eunmo Koo] SK Securities expects Poongsan to achieve strong performance in the third quarter, driven positively by rising copper prices, improved demand, and growth in the defense sector. The investment rating was maintained at 'Buy,' and the target price was raised from the previous 26,000 KRW to 29,000 KRW.

SK Securities estimated that Poongsan's consolidated sales for the third quarter of this year would increase by 14.6% year-on-year to 646.3 billion KRW, operating profit would grow by 5.1% to 33 billion KRW, and net profit would turn positive to 18 billion KRW. On the 28th, SK Securities analyst Sunwoo Kwon stated in a report, "Along with demand recovery compared to the previous quarter, the recent sharp rise in copper prices contributed positively to performance through top-line growth and inventory asset revaluation gains," adding, "The defense sector, which began recovering from the second quarter, is also expected to continue stable growth compared to the same period last year."

The copper price, which has the greatest impact on stock price and performance, rebounded after the second quarter due to expectations of stimulus measures in major countries and the resumption of production in key downstream industries. Analyst Kwon explained, "Although there is a possibility of correction due to short-term price increases, the price strength is expected to continue for the time being as supply disruptions and demand expansion persist." He also added, "Major copper mining sites have announced expansion plans and are advancing implementation timelines, but since most are scheduled for after 2022, this also reduces the burden."