[Asia Economy Reporter Hyungsoo Park] T플랙스 (T플랙스) is showing strong performance. Following external growth driven by increased demand in the upstream market, the stock price appears to be influenced by expectations of continued structural growth amid a favorable industrial environment.
As of 12 a.m. on the 26th, T플랙스 is trading at 4,560 KRW, up 16.92% from the previous day.
Oh Hyunjin, a researcher at Kiwoom Securities, explained, "On the demand side, the increase in semiconductor equipment investment and the recovery of the automobile market have raised the demand for stainless steel," adding, "Next year, demand growth is expected in the LNG ship market."
He continued, "In the case of LNG ships, natural gas must be liquefied and transported at low temperatures, making products such as cryogenic valves essential," and "This will increase the demand for stainless steel with high corrosion resistance."
Furthermore, he emphasized, "Stainless steel is widely used not only for valves but also for engine parts, fittings, and construction materials due to its excellent corrosion resistance and outstanding workability."
Researcher Oh also analyzed, "The favorable industrial environment will lead to improved profitability," noting, "Since the second half of last year, the rise in nickel prices, the application of product price increases, and the impact of price increases originating from China have been reflected, resulting in an operating profit margin of 5.2% in the first quarter and 9.6% in the second quarter."
He stated, "The scope of performance improvement is expected to widen in the second half of this year," adding, "The rise in nickel prices can be seen not only as a factor for increasing the selling price of stainless steel but also as a demand growth factor."
Researcher Oh expects it will also contribute to improved profitability through inventory sales.
He explained, "According to the company's guidance, this year's performance forecast is sales of 175.4 billion KRW and operating profit of 14.8 billion KRW," which represents increases of 32% and 209%, respectively, compared to last year.
With growing interest in eco-friendly materials, demand for stainless steel, which does not rust, is continuously expanding across all industrial sectors. In the domestic market, demand is steadily increasing in upstream industries such as module materials for electric vehicle batteries and cryogenic materials for LNG ships. As interest in electric vehicles grows, stainless steel materials are used in the manufacturing process of electric vehicle battery modules to protect against external shocks, heat, and vibrations.
T플랙스 has achieved sales exceeding 5 billion KRW from May 2019 for Bosch (acting as a pillar, producing stainless steel materials) for electric vehicle battery modules. In July last year, it signed its largest single export contract, supplying 300 tons to a Taiwanese company. Going forward, supply volumes are expected to increase in line with the expansion of the electric vehicle market.
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