[Featured Stock] GS Construction Slightly Rises Despite 10-Month Business Suspension 추진

Image source=Yonhap News

Despite news that a total of 10 months of business suspension is being pursued due to the collapse accident in the underground parking lot of Geomdan Apartment in Incheon, GS Construction is showing a slight upward trend.

As of 9:29 a.m. on the 28th, GS Construction was traded at 14,040 KRW, up 0.29% compared to the previous trading day. On the same day, GS Construction dropped to 13,440 KRW but then reversed to an increase.

The day before, the Ministry of Land, Infrastructure and Transport decided to pursue an 8-month business suspension by the minister's authority against the GS Construction consortium, the contractor of Geomdan Apartment, and its subcontractors due to poor construction. Additionally, due to inadequate safety inspections, the Ministry plans to request Seoul City to impose a 2-month business suspension on this consortium. If the Administrative Sanctions Committee decides on the 8-month suspension by the minister's authority and Seoul City accepts the Ministry's request for a 2-month suspension, a total of 10 months of business suspension will be enforced.

However, securities firms judged that this decision has resolved the maximum risk to the stock price. Donghyun Shin, a researcher at Hyundai Motor Securities, explained, "The additional reconstruction site risk, which was the main cause of the sharp stock price drop, has been resolved, so the decline will be limited compared to before," and regarding performance, "Although the 10-month business suspension raises concerns about new projects, the impact on short-term performance will be limited."