[Click eStock] "Pungsan, Defense Annual Sales Likely to Surpass 1 Trillion Won... Target Price 56,000 Won"

Daishin Securities newly set the target price for Poongsan at 56,000 KRW on the 11th.

Poongsan, which produces non-ferrous metal material products and defense supplies, is expected to record sales of 1.0615 trillion KRW (consolidated basis) in the second quarter, down 8.6% year-on-year, and operating profit of 84.9 billion KRW, down 5.3%. This exceeds market expectations.

Sales volume in the non-ferrous metal segment is estimated to have slightly recovered to around 45,000 tons compared to the previous quarter. Although the defense sector is expected to see a slight decline in profitability due to decreased export sales compared to the previous quarter, it is still expected to maintain an operating profit margin of over 10%. In particular, the defense sector is likely to surpass annual sales of 1 trillion KRW for the first time ever, driven by ammunition demand.

Poongsan's business is broadly divided into two segments: the non-ferrous metal business, which processes copper, and the defense business, which produces ammunition products.

Lee Taehwan, a researcher at Daishin Securities, said, "Historically, the non-ferrous metal segment has contributed significantly to sales and profits, but recently the defense sector has expanded its export markets to the US and the Middle East in addition to stable military supply demand." He evaluated, "With the war between Ukraine and Russia, global ammunition demand has increased, driving structural performance improvement and re-rating."

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