[BizLeader] SW Steel Tech "Second Plant Expansion After Listing... Doubling Production Capacity"

Surpassing 100 Billion KRW in Sales in 7 Years with High-Performance Deck Plates
Aiming for KOSDAQ Listing in November as a Comprehensive Building Materials Company

Sungkyun Hong, CEO of SW Steel Tech.

Leading innovator in deck plate technology, SW Steel Tech, is knocking on the door of the KOSDAQ market. After listing, SW Steel Tech plans to invest the public offering funds in expanding its second factory, aiming to double its production volume by the year after next.

SW Steel Tech, established in July 2015, is a comprehensive building materials company. Its main business area is the manufacturing of high-performance deck plates. Deck plates are metal processed assembly structural materials used when pouring concrete for building floor slabs. Compared to the plywood formwork method, they offer advantages such as saving time, labor, construction costs, and ensuring safety.

Hong Sung-kyun, CEO of SW Steel Tech, said, "Due to the many advantages of the deck plate method, the number of construction sites utilizing deck plates is gradually increasing," adding, "Therefore, even if the construction market is not favorable, the replacement demand for plywood formwork methods is expected to steadily grow." In fact, the sales volume of major deck plate companies has increased by an average of 13.5% annually over the past three years.

SW Steel Tech's main products include ▲Standard Deck Plate TG DECK ▲Detachable Deck Plate GREEN DECK ▲Insulation Integrated Deck Plate HEAT DECK. Only three companies in the industry, including SW Steel Tech, have established a portfolio of these three types of high-performance deck plates.

CEO Hong stated, "Especially, HEAT DECK is a patented adhesive product, unlike the bolt-fastening method mass-produced by other companies, which enhances competitiveness," and added, "Using this product allows omission of the detachment process, shortening construction time and reducing costs, and it is safe for hot work, so demand continues to increase."

SW Steel Tech's performance has been rapidly increasing every year. As of the end of last year, SW Steel Tech's sales reached 100.1 billion KRW, a 49% increase from 67.3 billion KRW the previous year. The company surpassed the 100 billion KRW mark within seven years of its establishment. In the first half of this year, sales were 63.4 billion KRW and operating profit was 7.4 billion KRW, growing 31% and 159% respectively compared to the same period last year.

CEO Hong attributes the outstanding growth compared to the industry average to strong sales capabilities. He explained, "More than 85% of the sales department staff at SW Steel Tech majored in architectural or civil engineering, enabling customized technical sales," adding, "This is why we can achieve the industry's highest sales per person."

Based on this sales strength, SW Steel Tech secured major high-quality construction companies as clients by registering as a partner with 87 out of 89 companies using deck plates among the top 100 major construction firms as of last year.

SW Steel Tech's sales approach differs from other companies by signing distribution contracts with dealerships. Typically, deck plate companies receive orders directly from construction companies and deliver products. However, SW Steel Tech contracts with dealerships nationwide that can supply small-scale construction sites, generating large-scale distribution sales. CEO Hong said, "While other companies have distribution sales at about 5-10%, we trade with 98 out of approximately 130 nationwide distribution points, making 40-50% of total sales from distribution," and explained, "The deck plate industry is heavily influenced by the steel market, affecting profitability, but we can secure relatively stable margins."

After listing, SW Steel Tech plans to invest the public offering funds in expanding its second factory located in the Dongchungju Industrial Complex. The maximum production capacity of the first factory is currently 300,000㎡ per month. The second factory is expected to have a maximum production capacity of 200,000㎡ per month. CEO Hong said, "The second factory will produce not only the existing integrated decks but also patented Bodeck, insulation-attached Bodeck currently under development, and detachable Bodeck," adding, "Once the factory starts operation in the second half of next year, sales volume will also increase."

Meanwhile, SW Steel Tech plans to offer 7 million new shares in this public offering. The expected offering price is 1,200 to 1,500 KRW per share, with a total offering amount of 8.4 to 10.5 billion KRW. The demand forecast will be conducted over five days from the 23rd to the 27th, followed by a general subscription on November 1st and 2nd, aiming for a KOSDAQ listing on November 10th. The listing is underwritten by KB Securities.