[Click e-Stock] "Poongsan Expected to Achieve Record Operating Profit This Year"

On January 9, Hana Securities stated that Poongsan is expected to continue delivering strong results thanks to increased defense sales driven by rising copper prices, forecasting that this year's operating profit will reach an all-time high. The investment opinion remains 'Buy' with a target price of 160,000 won.

In the fourth quarter of last year, Poongsan's revenue and operating profit are expected to reach 1.5 trillion won (up 19.8% year-on-year) and 101.3 billion won (up 199.0%), respectively, with operating profit projected to exceed the market consensus of 88 billion won.

Park Seongbong, a researcher at Hana Securities, commented, "Sales volume of copper products increased slightly from the previous quarter to 47,000 tons, and the average LME copper price reached $11,092 per ton, resulting in metal-related profits of over 10 billion won. Due to the rise in copper prices, profitability at overseas copper product subsidiaries, including PMX, is expected to improve compared to the previous quarter."

With LME copper prices showing a steep upward trend, there is growing optimism about Poongsan's performance. This trend is attributed to production disruptions and strikes at major mines in Indonesia and Chile, as well as the announcement by the China Smelters Purchase Team (CSPT) of reduced refined copper production.

Researcher Park added, "Following last year, defense sales are expected to increase by 10% this year. Considering the significant metal-related profits resulting from rising copper prices, this year's operating profit is likely to far exceed the previous record set in 2024. The current price-to-book ratio (PBR) stands at 1.3 times, and given this year's strong performance and the prospect of stable and sustained growth in defense sales, valuation pressure is also limited."