The Return of the 'Fine Dust' Season... Who Are the Beneficiaries?

On the 15th, the first working day after the Lunar New Year holiday, citizens are walking to work at Gwanghwamun Intersection in Jongno-gu, Seoul. Photo by Mun Honam munonam@

[Asia Economy Reporter Park Ji-hwan] Interest in beneficiary stocks is growing ahead of the spring yellow dust season, when fine dust becomes rampant. Traditional beneficiary stocks related to fine dust include 'masks' as well as manufacturers of 'air purifiers' and 'ventilation purifiers.'

At 9:05 a.m. on the 15th, Winix, a representative manufacturer of air purifiers, was traded at 26,900 KRW, up 1,150 KRW (4.43%) from the previous trading day. The stock price, which was 23,700 KRW at the end of last year, has risen 13.5% since the beginning of this year. At the same time, SPG, a manufacturer of air purifier motors, recorded 9,100 KRW, up 160 KRW (1.79%). It has risen 9.51% since the beginning of the year.

In addition to fine dust, the trend of staying at home due to COVID-19 has led to increased interest in manufacturers of ventilation purifiers that improve indoor air quality. The stock price of Hats, a manufacturer of dust collection devices that collect and filter dust in indoor air, has shown a clear upward trend, rising 29.8% from 8,320 KRW at the end of last year to 10,800 KRW. Baek Joon-gi, a researcher at NH Investment & Securities, said, "Interest in indoor air quality due to respiratory infectious diseases and fine dust is unlikely to be a short-term issue, and many new products related to indoor air quality such as ventilation purifiers are expected to be released this year."

The rise in fine dust-related stocks is interpreted as being due to the expectation that fine dust deterioration will repeatedly occur this spring. On the 14th, the government implemented an emergency fine dust reduction measure for the first time this year as high concentrations of fine dust occurred. This was due to the sustained high concentration of ultrafine dust (PM2.5) exceeding 50㎍/㎥, mainly in the metropolitan and Chungcheong areas. There is also analysis that the reactivation of factories in China, the world's factory, has a significant impact. Last year, shutdowns occurred due to the spread of COVID-19, but this year, the Chinese economy is operating almost normally, increasing the likelihood of repeated fine dust effects.

However, mask-related companies, which are representative stocks for the spring season, are expected to benefit less this time since their stock prices rose sharply last year amid the spread of COVID-19. In fact, mask companies such as Welcron and Monalisa have shown weakness, with their stock prices falling 13.1% and 6.45%, respectively, since the beginning of the year.