[Click eStock] Korea Aerospace Industries, Multiple Contracts Possible Within the Year... Target Price Raised

Meritz Securities raised the target price for Korea Aerospace Industries to 72,000 KRW on the 30th, citing the possibility of multiple contracts within the year. The investment rating was maintained as 'Buy.'

Jiho Lee, a researcher at Meritz Securities, stated, "Korea Aerospace Industries holds numerous pipelines within Southeast Asia, making it a noteworthy time as its presence in the region is expected to expand in the mid to long term. The target price was raised to reflect the increase in earnings per share (EPS) due to the change in the timing of the fair value assessment."

He added, "Recently, China is accelerating its military modernization timeline and has taken unprecedented steps such as officially demanding the United States to halt the armament of Taiwan. The possibility of an early contract for the Philippines' FA-50 seems to reflect this situation, and there is also a potential acceleration in weapons demand across Southeast Asia."

Korea Aerospace Industries recorded third-quarter sales of 907.2 billion KRW, down 9.9% year-on-year, and operating profit of 76.3 billion KRW, up 16.7% during the same period, generally meeting consensus expectations.

Researcher Jiho Lee analyzed, "Despite a decline in the aircraft parts segment due to the fall in the exchange rate in September, solid results were recorded based on major export projects (FA-50 for Poland and Malaysia, T-50 4th batch for Thailand). The fourth quarter is expected to continue performance growth as it is a seasonal peak, but a slight downturn in the aircraft parts segment is inevitable due to the ongoing Boeing strike."

Although the stock price has stagnated this year due to the absence of new orders in the finished aircraft export sector, it is expected to show a positive trend with multiple orders emerging from the end of this year to early next year.

Researcher Jiho Lee said, "As orders that had been relatively sluggish so far appear, the stock price is also likely to show a positive trend."