[Special Stock] The Golden Egg Launched by Trump's Tariff Bomb, Hyosil's US Factory Forecasts Big Success

Hyusteel is showing strong performance. It appears that the analysis of the company as a listed firm aligned with U.S. President Donald Trump's energy policy and domestic factory construction inducement policy is influencing the stock price. Hyusteel manufactures API-certified well pipes and pipelines used for oil and gas field development drilling. To diversify its product portfolio (entering the offshore wind substructure and large-diameter pipeline markets), Hyusteel is investing a total of 210 billion KRW to complete an SAW (Submerged Arc Welded) pipe plant with an annual production capacity of 165,000 tons by the first half of this year.

As of 9:19 AM on the 4th, Hyusteel is trading at 5,700 KRW, up 16.45% from the previous trading day.

Hana Securities analyzed Hyusteel as "precisely aligned with U.S. President Donald Trump's energy policy and domestic factory construction inducement policy."

Seongbong Park, a researcher at Hana Securities, stated, "We expect an expansion of fossil fuel development in the U.S. due to President Trump's energy policy (Drill, baby, drill)," adding, "After signing the executive order imposing a 25% tariff on steel, steel prices in the U.S., especially OCTG (Oil Country Tubular Goods) prices, surged."

The executive order takes effect from the 4th (local time). Anticipation of reduced imports has been preemptively reflected, with U.S. OCTG pipe prices rising 30.6% compared to before the signing. Researcher Park noted, "Further increases in domestic U.S. prices are possible depending on the scale of reduced steel pipe imports," and added, "If a uniform 25% tariff on Canada and Mexico is finalized, these countries could face an additional 25% tariff on top of the existing 25% steel tariff, potentially resulting in a total 50% tariff."

Recently, President Trump has accelerated approvals for various pipeline constructions, including urging the Keystone Pipeline construction. Hyusteel is expanding its production range from small-diameter pipelines produced through existing ERW (Electric Resistance Welded) pipes to large-diameter pipelines with this investment, increasing the potential for pipeline exports to the U.S.

Researcher Park analyzed, "Hyusteel is currently constructing an API steel pipe plant in the U.S., mainly producing 72,000 tons of well pipes, scheduled for completion in the first half of this year," and added, "This allows the company to avoid U.S. import restrictions." Furthermore, "The U.S. plant site was purchased with expansion in mind from the construction stage," and "An additional expansion to 180,000 tons is reportedly under consideration."

Hyusteel's cumulative operating profit for the third quarter of last year was 15.8 billion KRW, and it is estimated to reach the high 10 billion KRW range annually. Currently, Hyusteel's stock price is roughly at a price-to-earnings ratio (PER) of 8 times based on 2024 estimates. Researcher Park explained, "Despite the 25% U.S. tariff on Korean steel pipes, considering the abolition of the existing quota system and the expected price increase for energy-use pipes in the U.S., Hyusteel's PER is expected to fall to around 3 to 4 times this year," adding, "This highlights its undervaluation appeal."