[Special Stock] LS ELECTRIC Plummets 19%, Market Cap Drops by 1.15 Trillion Won Following Earnings Announcement

2Q Operating Profit Grew but Stock Price Plummeted
Seems to Have Fallen Short of Overly High Market Expectations

LS ELECTRIC plummeted. Its market capitalization evaporated by over 1 trillion won within just one hour after the market opened.

As of 10:19 AM on the 25th, LS ELECTRIC is trading at 219,500 won, down 15.58% (40,500 won) compared to the previous day. Compared to the market capitalization based on the previous day's closing price, it decreased by 1.15 trillion won. The stock hit a low of 214,500 won and is currently showing a slight rebound.

On the same day, LS ELECTRIC announced that its Q2 consolidated operating profit increased by 4.51% year-on-year to 109.6 billion won. This is a preliminary result. Sales decreased by 5.77% to 1.1324 trillion won. Although operating profit grew, the sharp drop in the stock price appears to be due to somewhat disappointing results compared to the booming industry benefiting from increased demand for artificial intelligence (AI) data centers and the heightened market expectations. The operating profit slightly exceeded the market consensus forecast of 94.6 billion won.

Earlier, HD Hyundai Electric, a peer in the same industry that announced its earnings, posted an 'earnings surprise' with an operating profit of 210 billion won, surpassing the market consensus forecast of 124.3 billion won. Along with HD Hyundai Electric and Hyosung Heavy Industries, ELECTRIC is considered one of the three major domestic power equipment companies. Due to earnings expectations, ELECTRIC's stock price rose about 19% over the past two trading days but has now given back all of those gains.