[Special Stock] GS Global Increases Coal Mine Stake... Global Coal Shortage 'Can't Turn on Air Conditioner'

[Asia Economy Reporter Hyungsoo Park] GS Global is showing strong performance. Amid the sharp rise in various raw material prices due to the Ukraine war, news of a large-scale power outage caused by coal shortages in India appears to have influenced the stock price.

At 10:55 AM on the 22nd, GS Global was trading at 4,360 KRW, up 16.27% from the previous day.

Due to power shortages, power supply was cut off for 8 hours in major states such as Punjab and Uttar Pradesh in northern India, and Andhra Pradesh in the south. India relies on coal-fired power generation for 70% of its electricity, and power shortages are occurring due to coal supply shortages.

With the outbreak of the Ukraine war causing a sharp rise in prices of oil and raw materials, India is facing great difficulties in procuring coal. Since March, temperatures have exceeded 40 degrees Celsius, causing a surge in air conditioner demand and worsening the power shortage. The average temperature in March was the highest since 1901.

According to the Bank of Korea, the Producer Price Index for March (provisional, 2015 level 100) was 116.46, up 1.3% from the previous month (114.95). This marks a rise for three consecutive months. Compared to a year ago, it is 8.8% higher, continuing an upward trend for 16 months.

Looking at the month-on-month price index changes by sector, manufactured goods, which have the largest weight in the index calculation, rose 2.3%. Among manufactured goods, coal and petroleum products (15.6%) recorded the highest increase in 1 year and 9 months since June 2020 (21.3%), and chemical products (2.8%) recorded the highest increase in 11 months since April 2021 (3.4%).

GS Global, based on over half a century of accumulated business know-how and domestic and international networks, is expanding its value chain beyond simple trading in resource sectors such as coal and biomass, including equity investment in the Indonesian BSSR coal mine with Off-take rights. It is expanding its profit scale through diversification of handled items such as cement, palm oil, and biodiesel.