[Click eStock] "LIG Nex1, Beginning of Performance Improvement"... Target Price Up

[Asia Economy Reporter Ji Yeon-jin] Daishin Securities announced on the 12th that it is raising the target stock price of LIG Nex1 to 67,000 KRW, reflecting that the company is at the beginning of mid- to long-term performance improvement based on a substantial order backlog.

LIG Nex1 recorded sales of 458.9 billion KRW in the third quarter of this year, an 11% increase compared to the same period last year, and operating profit of 35.5 billion KRW, a 335% increase. Compared to market expectations, sales were 2% lower, but operating profit was an earnings surprise exceeding expectations by 50%.

Sales surged domestically to 440.3 billion KRW (+15%), while exports decreased to 18.6 billion KRW (-37%). This is analyzed as balanced growth in domestic development and mass production projects, along with the beginning of revenue recognition from the increased order backlog. Operating profit significantly increased due to cost reductions in some projects and decreased fixed costs resulting from sales growth.

The company's order backlog stands at 6.7 trillion KRW, exceeding the same period last year by 16%. It is expected to increase to 7.7 trillion KRW by the end of the year. Researcher Lee Dong-heon of Daishin Securities stated, "In 2022, exports will drive growth, with about 45% of the backlog expected to be export orders," adding, "As stagnation in project progress is resolved, a full-scale increase in exports will begin, and profitability is also expected to be favorable in exports."

This content was produced with the assistance of AI translation services.