[Click eStock] "LS Jeonseon Asia, Expected Best Performance This Year... Vietnam Normalization Underway"

▲Employees of LS Cable Asia in Haiphong City, Vietnam, are producing copper wire rods. (Provided by LS Cable Asia)

[Asia Economy Reporter Hwang Yoon-joo] Daishin Securities maintained a 'Buy' rating and a target price of 12,000 KRW for LS Cable Asia on the 15th, expecting the company's best performance this year.

Researcher Park Kang-ho of Daishin Securities stated, "Sales in 2022 are expected to increase by 10.2% year-on-year to 826.9 billion KRW, and operating profit is projected to rise by 16.1% to 32.8 billion KRW."

Researcher Park explained, "Operating profit is estimated to increase due to the mix effect from the Vietnamese government's strengthened renewable energy policies and the expanded proportion of power cables."

▲An employee is manufacturing power cables at LS-VINA, the Vietnamese subsidiary of LS Cable Asia. (Provided by LS Cable)

Researcher Park said, "Although delays continue in Vietnam's domestic power projects, an expansion in the improvement of performance in communication cables, including UTP, is expected," adding, "In the second half of 2022, the recovery of power projects and the LSCV (Ho Chi Minh City, Vietnam) subsidiary will record the highest performance since its establishment."

He further analyzed, "LSVINA (Hanoi) is focusing on securing large Korean power plant projects and renewable energy projects in ASEAN countries in Vietnam, which is expected to improve sales and profitability."

Researcher Park evaluated, "Vietnam is expected to see increased investment in renewable energy in 2022, replacement due to undergrounding of power cables, and expanded demand for communication cables," adding, "As the market leader with the highest share, LS Cable Asia will benefit from these effects."