[Click eStock] "Pungsan, Trump Copper Tariffs Actually Beneficial"

Daishin Securities selected Poongsan as its top pick, analyzing that the low dependence on exports to the U.S. in the non-ferrous metal business sector will limit the impact of tariffs. The investment opinion was maintained as 'Buy' with a target price of 88,000 KRW.

Poongsan's consolidated sales for the fourth quarter of last year increased by about 10% year-on-year to 1.23 trillion KRW, while operating profit fell 41.6% to 33.9 billion KRW, falling short of market expectations. Tae-hwan Lee, a researcher at Daishin Securities, explained the background of the poor performance, stating, "Both the non-ferrous metal sector (due to rising copper prices and increased sales volume) and the defense sector (concentrated domestic and export ammunition sales in Q4) had favorable performance environments, but approximately 60 billion KRW in one-time costs (including 48 billion KRW in consolidated performance bonuses) occurred."

Following U.S. President Donald Trump's announcement of a 25% tariff on steel and aluminum, and his directive to investigate copper, this trade environment is seen as an opportunity for Poongsan. The researcher noted, "There is no U.S. sales proportion in Poongsan's domestic production items in the non-ferrous metal sector, and production through its subsidiary PMX (U.S. corporation) is understood to mostly source raw materials within the U.S. region," adding, "The tariff issue is considered a positive factor for the company." Poongsan has presented a plan for 2025 with sales of 3.8 trillion KRW (2.54 trillion KRW in non-ferrous metals, 1.26 trillion KRW in defense) and a pre-tax profit of 280 billion KRW.

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