[Click eStock] "Dongkuk Industries Preparing to Leap with Nickel-Plated Steel Sheets and Tungsten New Business"

Leading Investment & Securities analyzed on the 25th that Dongkuk Industries is preparing to leap forward with new businesses in nickel-plated steel sheets and tungsten.

Dongkuk Industries mainly processes and sells cold-rolled steel sheets, with major subsidiaries including Dongkuk S&C (wind power business and construction, 49.99% stake) and DK Dongsin (manufacture and sale of color steel sheets, 81.9% stake). The sales composition is 45% cold-rolled steel sheets, 27% color printed steel sheets, 16% renewable energy, and 12% construction.

Researcher Yuseongman of Leading Investment & Securities stated in the report on the same day, “Dongkuk Industries is preparing the ‘nickel-plated steel sheet’ business, a material for cylindrical battery cases used in secondary batteries, to respond to the mid- to long-term decline in demand for internal combustion engine vehicles, which are the main consumers of cold-rolled steel sheets,” and forecasted that “it will establish a capacity of about 130,000 tons in Pohang, Gyeongbuk, and start full-scale mass production from 2025.”

Researcher Yuseongman added, “Electric vehicles will replace the decline of internal combustion engine vehicles, expanding their share to 57% of the total market share by 2030,” and “due to the expansion policies for electric vehicles and carbon zero policies in major advanced countries (the US & Europe), environmental issues, and the performance development of electric vehicles, the market will rapidly expand.”

The proportion of cylindrical batteries is expected to account for about 25% of the total by 2030. The number of automakers applying cylindrical secondary batteries (Tesla, Lucid, Rivian, Volvo, Jaguar, Hyundai-Kia, BMW, etc.) is increasing, and demand is expanding to motorcycles, e-bikes, and ESS. Therefore, demand for the material related to cylindrical batteries, ‘nickel-plated steel sheets,’ is increasing, and a supply shortage is expected in 2025 due to a global capacity shortage.

Researcher Yu said, “Dongkuk Industries acquired ‘Voltech Korea,’ the only domestic ferro-tungsten company, in August last year,” and predicted that “ferro-tungsten, an alloy of iron and tungsten mainly used in defense and precision machinery parts, will benefit from the increasing defense demand.”

He continued, “The expected consolidated sales for this year are 901.4 billion KRW, and operating profit is 8.9 billion KRW, increasing by 4.7% and 655.6% respectively compared to the previous year,” and analyzed that “sales growth is slowing due to the global recession, remaining similar to last year, but some improvement is expected in operating profit.”

Furthermore, he added, “Full-scale performance growth from new businesses is expected to be possible from 2025.”