Severe Cold Wave and Heavy Snow...Winter-Related Stocks Gain Strong Interest

Due to the Arctic cold wave, the lowest temperature in Seoul dropped to minus 16 degrees Celsius, prompting a cold wave warning. On the 7th, commuters hurried along a street in Yeouido, Seoul, on their way to work. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Park Jihwan] As the strongest cold wave of this winter arrives, beneficiary stocks are showing strength in the stock market. Although the stock prices of representative winter-related stocks such as heating, winter snacks, and clothing have already risen once, they are showing an additional upward trend as the full-fledged cold weather approaches. However, some analyses suggest that the rise in these stocks is not significant in the domestic stock market, which is experiencing an unprecedented bull market era with the KOSPI surpassing 3000 points.

According to the Korea Meteorological Administration on the 7th, temperatures in January this year are expected to be similar to or lower than average, and temperature fluctuations in February will be large, resulting in overall colder weather than last winter. As colder weather than usual is expected, the stock price of Korea Gas Corporation, a representative winter beneficiary stock, has risen 12.7% from December last year to recently. The stock price, which was 28,350 KRW at the end of November last year, closed at 31,950 KRW based on the previous day's closing price. Heating stocks tend to improve earnings expectations as heating demand increases with falling temperatures. Korea Gas Corporation already started its stock price rise in October, when the cold wind began, rising 10.5%.

When there is heavy snowfall in winter, stocks related to de-icing agents such as calcium chloride also attract attention. In the case of Taekyung BK, a company that produces calcium chloride materials used as de-icing agents, the stock price surged 8.6% based on the previous day's closing price since December last year. On this day as well, influenced by the heavy snow that fell in the metropolitan area the previous day, it showed a strong rise of over 11% in the early trading session. It has risen on 7 out of the last 9 trading days.

Winter sales-focused steamed bun companies are also on the rise. SPC Samlip, famous for its Samlip steamed buns, showed an 11.2% increase in November last year and has continued to rise by over 3% from December to recently.

Clothing stocks are also an industry heavily influenced by the weather. BYC, which manufactures thermal underwear, has shown a remarkable recent rise. The stock price, which was 286,500 KRW at the end of December last year, closed above 300,000 KRW the previous day. The stock price has risen 6.7% over the last five trading days.

However, experts analyze that while the domestic stock market is showing record-breaking gains recently, the rise in winter-related stocks is not as prominent as in previous years. They advise that investment should be considered based on medium- to long-term earnings trends rather than the seasonal theme of winter-related stocks. A financial investment industry official said, "Stocks benefiting from seasonality are already recognized annually in the market, and it is difficult to know whether they will show additional upward trends," adding, "It is necessary to consider investment by individual stocks based on future earnings."