[Click eStock] "LIG Nex1, Undervalued Compared to Order Momentum... Target Price Up"

On the 20th, KB Securities raised the target price of LIG Nex1 from 200,000 KRW to 245,000 KRW, an increase of 22.5%. The investment rating was also upgraded from ‘Hold’ to ‘Buy’. Since the stock price has fallen excessively since July, increasing its valuation appeal, and recent large-scale orders have continued, it is expected to act as a driving force for a rebound.

Cheongung II launcher [Image source=Yonhap News]

Jung Dong-ik, a researcher at KB Securities, analyzed, "LIG Nex1's stock price rose to 249,000 KRW on July 17 but dropped 32% to 168,700 KRW on the 9th," adding, "This decline is twice the KOSPI's 16.6% drop during the same period." Analyst Jung noted, "The stock price decline was particularly large compared to other defense companies," and assessed that "the stock price has fallen excessively."

He predicted, "The stock price burden relative to the company's intrinsic value has decreased, and with the increasing likelihood of large-scale orders from Iraq materializing, market concerns about sustained orders can also be dispelled."

According to the Middle East defense media Defence Arabic on the 9th, the Iraqi government is expected to sign a contract for the introduction of LIG Nex1's Cheongung II. The contract size is reported to be $2.56 billion (approximately 3.4 trillion KRW). If the export to Iraq is successful, the number of countries operating Cheongung II will increase to four, including South Korea, the United Arab Emirates (UAE), and Saudi Arabia.

Analyst Jung stated, "Major domestic media outlets have also reported the same, so the credibility of the new order news from Iraq is considered high," and forecasted, "If it leads to an actual order, Iraqi sales will begin from 2026."

He added, "Cheongung II has established itself as a representative Western mid-range air defense system alongside the US Patriot system," and expressed expectations that "as the number of user countries increases, it will positively impact additional sales through new acquisitions or additional purchases by existing countries."