[Asia Economy Reporter Jang Hyowon] The Ministry of Land, Infrastructure and Transport announced that it aims to achieve overseas orders worth $50 billion (approximately 65.44 trillion KRW) annually during President Yoon Suk-yeol's term, centered on 'K-Smart Infrastructure.' In this context, railway-related stocks, considered the most important elements for economic development and restoration of key facilities, are gaining attention.
On the 18th, the Ministry of Land, Infrastructure and Transport announced in the new government’s work plan that it will foster 'K-Smart Infrastructure,' which combines mobility and smart technologies with infrastructure projects such as railways, airports, and urban development, as a national strategic industry.
In particular, it plans to actively utilize opportunities such as the Middle Eastern oil-producing countries benefiting from high oil prices and the reconstruction of Ukraine and Iraq, targeting markets in a 'Team Korea' format where the private sector leads and the public sector supports.
Minister Won said, "President Yoon will push to empower overseas orders through summit diplomacy." The Ministry of Land, Infrastructure and Transport plans to strengthen support such as high-level diplomacy, expansion of export financing, and increased G2G investments by public enterprises, and will review regulatory relaxation measures applied to overseas construction sites and plans to expand public enterprise investments.
According to industry insiders, the second half of the year is expected to have a more favorable overseas order environment compared to the first half due to recent consecutive orders and rising international oil prices. Overseas orders, especially projects in the Middle East, are determined by international oil prices, so more orders can be expected than before. In addition to the Middle East, orders for various projects such as railways, ports, and plants are being made worldwide.
Also, the Ministry of Land, Infrastructure and Transport plans to form a 'Ukraine Reconstruction Council' this month, involving the government, public enterprises, and industry. The scale of the reconstruction project is estimated at $750 billion (approximately 972 trillion KRW).
According to related industries, last month Russia attacked railway facilities, recognizing the strategic importance of railways for military frontline transport and the national economy. Forbes reports that the UK will allocate up to ?10 million to repair Ukrainian railways.
Given that reconstruction projects are expected to focus on restoring damaged railways, companies such as Hyundai Corporation, Hyundai Rotem, Da-Ai TAI, and Daeho AL are attracting attention.
Hyundai Corporation and Hyundai Rotem supplied 90 high-speed electric trains to the Ukrainian Railway Authority in 2010. They will be responsible for maintenance services and contract extensions for the ordered trains until 2027. The two companies are also known to participate in the Ukrainian high-speed rail project jointly with the Export-Import Bank and the Korea Trade Insurance Corporation. Hyundai Rotem has been recognized for its business capabilities by repairing local high-speed trains despite the Ukraine crisis.
Da-Ai TAI is a company engaged in railway signal control systems. Based on its independently developed Centralized Traffic Control (CTC) technology, it is responsible for building and maintaining domestic railway control systems.
Daeho AL produces aluminum coils and sheets, supplying industrial materials such as secondary batteries and automotive parts. Daeho AL is a first-tier partner of Hyundai Rotem, and it is known that if Hyundai Rotem wins orders, there is a high possibility of orders for passenger car supplies produced through primary aluminum processing.
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