In the domestic stock market, cosmetics-related stocks are gaining attention, with Aestec, a 'global player' in UV protection ingredients, showing strong performance. The sunscreen market is expanding in line with recent climate change and anti-aging trends. According to global research firm Research and Market, the UV protection materials market is expected to grow at an average annual rate of 7.5%, from $11.4 billion in 2021 to $17.6 billion in 2027.
As of 2:05 PM on the 29th, Aestec was trading at 48,900 KRW, up 3,300 KRW (7.24%) from the previous trading day.
Aestec is the only domestic manufacturer of organic UV protection ingredients. Sunscreen ingredients are broadly divided into organic and inorganic UV filters. Aestec's main products are organic UV protection ingredients, which offer better sensory feel and a wider range of formulation applications compared to inorganic types. Aestec's DHHB uses alkaline raw materials, simplifying the process compared to BASF's DHHB and reducing costs by about 40%, securing price competitiveness.
According to an analysis report by Korea Investment & Securities, "As sunscreens have become essential consumer goods, the diversification of sunscreen formulations such as sprays and sticks has been achieved," adding, "They are also increasingly applied in makeup and skincare products, which is expected to benefit organic UV protection ingredients." The report further stated, "Aestec's core competitiveness lies in its ability to supply raw materials with high safety and photostability based on its existing active pharmaceutical ingredient development technology, offering high quality and price competitiveness."
Aestec is focusing on supplying two of the top global customers in the organic UV protection ingredient market. It has signed a long-term exclusive contract with DSM and has been increasing its sales proportion since last year. Following the mutual exclusive supply contract with DSM starting in May 2024 and existing contract deliveries to German company A, Aestec has proactively expanded its production capacity. It plans to start construction of a second plant using funds raised from its public offering. Next year, it aims to secure production capacity four times greater than the current level.
DS Investment & Securities researcher Cho Dae-hyung explained, "Aestec's DHHB is expected to benefit as it can replace Avobenzone, which has recently faced safety concerns, highlighting the need for alternatives."
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