[Click e-Stock] "LIG Nex1's Earnings Meet Consensus Despite Weak Share Price"

On October 27, Hana Securities stated that for LIG Nex1, costs such as development expenses deferred in the first half of this year will be reflected in the second half. In particular, considering the seasonality of concentrated domestic orders in the fourth quarter, there is also a possibility of provisioning. The company expects the annual operating profit trend to be high in the first half and lower in the second half. The target price is maintained at 562,000 won, with a 'Buy' investment rating.

For the third quarter of this year, LIG Nex1 is expected to post sales of 1 trillion won (up 35.1% year-on-year) and operating profit of 73.8 billion won (up 42.1%), in line with market expectations. Domestic sales are estimated to grow by 28.1% due to increased revenue recognition from the accumulated order backlog, while exports are projected to grow by 62.7% as Cheongung (M-SAM) sales expand, particularly in the Middle East.

Chae Woonsam, a researcher at Hana Securities, commented, "Operating profit will increase in line with the expansion of sales, and the scale of high-margin exports is also expected to expand compared to last year." He added, "However, due to increased costs such as development expenses and labor costs, the operating leverage effect will be limited."

In the fourth quarter, sales are expected to reach 1.2 trillion won (up 3.3%), driven by increased sales recognition in the Middle East. Operating profit is projected to increase to 74.1 billion won (up 20.1%), supported by the expansion of high-margin export sales, even though there is a tendency for provisions for losses to rise during periods of concentrated new domestic order contracts.

Chae also explained, "As in the past, it will be difficult for operating profit in the second half to surpass that of the first half, but in 2026, export sales are expected to grow more rapidly, leading to strong profit growth. As of the second quarter, the order backlog stood at 23.5 trillion won, equivalent to approximately 5.7 years' worth of sales."

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