August 19 Listing at IPO Price of 16,500 KRW
North America's 2nd Largest Market Share Company... Benefiting from Infrastructure Investment Expansion
Stock Price Up 50% This Month
The stock price of construction machinery equipment manufacturer Jeonjin Construction Robot has been rebounding this month. It is attracting attention as a 'sold-out stock' with a small number of circulating shares, along with expectations of expanded infrastructure investment in the North American region.
According to the financial investment industry on the 28th, Jeonjin Construction Robot's stock price rose 50.2% this month. During the same period, the KOSPI fell 0.4%. The return compared to the market reached 50.6 percentage points (P). When it was listed on the KOSPI on August 19, it rose to 28,900 KRW but fell to 14,500 KRW on the 2nd. It showed a typical new stock price trend, soaring compared to the initial public offering price of 16,500 KRW on the first day of listing, then experiencing profit-taking selling. As the profit-taking selling volume was absorbed, the stock price has steadily shown an upward trend.
Jeonjin Construction Robot produces concrete pump trucks and exports them to North America, Europe, and the Middle East. A concrete pump truck is equipment that transports concrete carried by mixer trucks (remicon) to the desired location at construction sites. Currently, concrete is one of the most efficient materials in construction technology. Concrete pump trucks, which transport concrete to the right place at the right time, are essential equipment at construction sites. The export ratio accounts for 72% of total sales. Among sales by region, North America holds the largest share, accounting for 38% of total sales.
Last year, Jeonjin Construction Robot was the second-largest company in the North American concrete pump truck market by market share. It maintains its market share by emphasizing high quality at a low price, highly versatile parts, and fast after-sales service (A/S).
Seongho Kim, a researcher at Hana Securities, explained, "Currently, the North American infrastructure industry is sluggish, but U.S. Democratic presidential candidate Vice President Kamala Harris and Republican candidate former President Donald Trump have pledged to expand infrastructure investment." He added, "Donald Trump promised to build more than 10 new cities and expand infrastructure investment," and "Harris plans to promote the construction of more than 3 million new homes and expand infrastructure investment within four years."
Hana Securities expects that if infrastructure investment in North America increases from next year, demand for large concrete pump trucks for infrastructure will rise, benefiting Jeonjin Construction Robot.
Jeonjin Construction Robot's stock price is also influenced by the small amount of shares circulating in the stock market. When it was listed on the KOSPI on August 19, it chose the method of selling existing shares. The total number of issued shares is 14,592,545, but the number of shares locked in mandatory holding is 11,993,246. Only the remaining 2,599,299 shares (17.8%) are traded.
Jeonjin Construction Robot has set a plan to maintain a dividend payout ratio of at least 50%. Sungkyu Heo, a researcher at Shinhan Investment Corp., explained, "The total dividends for the next three years are estimated to be 14.9 billion KRW, 16.5 billion KRW, and 19.2 billion KRW, respectively," adding, "The dividend per share is expected to increase to 1,029 KRW, 1,134 KRW, and 1,321 KRW."
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