[Special Stock] Hyundai Doosan Infra, Rising Raw Material Prices Boost Mining Demand... Wings of Myeonggajaegun Rebuilding

[Asia Economy Reporter Hyungsoo Park] The stock price of Hyundai Doosan Infracore is on the rise. Expectations of improved earnings appear to be influencing the stock price.

At 9:37 a.m. on the 27th, Hyundai Doosan Infracore was trading at 11,000 KRW, up 18.03% from the previous day.

Hyundai Doosan Infracore (formerly Doosan Infracore), acquired by Hyundai Heavy Industries Group in August, announced the day before that it had recently secured orders for 138 construction equipment units, including excavators, in the Latin American markets such as Chile and Colombia.

Latin America is one of the regions with abundant underground and forest resources, leading to high demand for construction equipment. In the Latin American market, where companies from the U.S., Japan, and China have been strong, Hyundai Doosan Infracore succeeded in securing large-scale orders. The Latin American construction equipment market size is expected to reach about 27,000 units this year, a 47% increase compared to the previous year.

Hyundai Heavy Industries Group expects that the synergy effect between its existing affiliate Hyundai Construction Equipment and the newly acquired Hyundai Doosan Infracore will enable entry into the top 5 global market share. Currently, the combined market share of the two companies ranks 10th worldwide.

Hyundai Doosan Infracore has already surpassed last year's annual sales by the third quarter and is expected to achieve annual sales 82% higher than last year. Hyundai Doosan Infracore expects improved earnings due to rising raw material prices. Since the beginning of this year, along with expectations of economic recovery after COVID-19, prices of raw materials such as coal, copper, zinc, and nickel have been soaring. As orders for construction machinery pour in from raw material producing regions, business opportunities for Hyundai Doosan Infracore are also increasing.

A Hyundai Doosan Infracore official said, “When raw material prices rise, mining companies need to significantly increase extraction volumes to make large profits, so they are placing large orders for construction machinery such as excavators and dump trucks.”