Corporate Logo(source: poongsan.co.kr)
On August 4, Hana Securities maintained its “Buy” rating on materials and defense company Poongsan (103140), while raising its target price to 160,000 won from 80,000 won. The revision reflects expectations for an earnings rebound in the second half of the year, driven by the normalization of defense exports and a recovery in the metals segment, despite recent declines in export volume and weak performance in the metal division.
Poongsan’s previous closing price was 135,500 won.
In the second quarter of this year, Poongsan posted consolidated revenue of 1.3 trillion won, up 4.9% year-on-year, while operating profit declined 42% to 93.6 billion won. The figure fell short of the market consensus of 113 billion won.
In a report, Park Sung-bong, an analyst at Hana Securities, stated, “Sales volume of fabricated copper products increased, mainly driven by demand in the automotive and energy storage system (ESS) sectors. With the average London Metal Exchange (LME) copper price reaching 9,524 dollars per ton in Q2, the company generated approximately 2.5 billion won in metal-related profits.” He added, “Despite a decline in sports ammunition exports to the U.S. due to tariff-related uncertainty, overall defense revenue reached 345.4 billion won, supported by expanded exports of other military products and solid domestic sales.”
Park continued, “Compared to the same period last year, a greater share of domestic sales and a reduced portion of high-margin products led to a decline in the defense segment's profit margin from 28% to 21%. Additionally, approximately 15 billion won in costs related to statutory wage adjustments and further expenses at a U.S. subsidiary due to tariff issues negatively impacted consolidated operating earnings.”
Looking ahead to the third quarter, copper prices are unlikely to rise, given the build-up of inventories in the U.S. amid concerns about potential U.S. tariffs on copper. Park forecast, “While domestic defense demand may rise slightly, exports are expected to decline significantly, resulting in a projected operating profit of 63.5 billion won in Q3, down 14.6% from a year earlier.”
Nonetheless, he emphasized, “With the defense division now accounting for more than half of the company’s total profit, steady growth in defense sales remains likely. In the short term, copper prices are expected to remain stable, and in the longer term, continued expansion in the defense business is a valid growth driver.”
*[KOSPI] Poongsan(103140), a subsidiary of the Poongsan Group, is divided into the new business sector(production of copper and copper alloy products) and the defense business sector(production of military ammunition, precision forging, etc.). The market capitalization is 3.792 trillion won (as of August 1, 2025, closing price).
Corporate Logo(source: poongsan.co.kr)
On August 4, Hana Securities maintained its “Buy” rating on materials and defense company Poongsan (103140), while raising its target price to 160,000 won from 80,000 won. The revision reflects expectations for an earnings rebound in the second half of the year, driven by the normalization of defense exports and a recovery in the metals segment, despite recent declines in export volume and weak performance in the metal division.
Poongsan’s previous closing price was 135,500 won.
In the second quarter of this year, Poongsan posted consolidated revenue of 1.3 trillion won, up 4.9% year-on-year, while operating profit declined 42% to 93.6 billion won. The figure fell short of the market consensus of 113 billion won.
In a report, Park Sung-bong, an analyst at Hana Securities, stated, “Sales volume of fabricated copper products increased, mainly driven by demand in the automotive and energy storage system (ESS) sectors. With the average London Metal Exchange (LME) copper price reaching 9,524 dollars per ton in Q2, the company generated approximately 2.5 billion won in metal-related profits.” He added, “Despite a decline in sports ammunition exports to the U.S. due to tariff-related uncertainty, overall defense revenue reached 345.4 billion won, supported by expanded exports of other military products and solid domestic sales.”
Park continued, “Compared to the same period last year, a greater share of domestic sales and a reduced portion of high-margin products led to a decline in the defense segment's profit margin from 28% to 21%. Additionally, approximately 15 billion won in costs related to statutory wage adjustments and further expenses at a U.S. subsidiary due to tariff issues negatively impacted consolidated operating earnings.”
Looking ahead to the third quarter, copper prices are unlikely to rise, given the build-up of inventories in the U.S. amid concerns about potential U.S. tariffs on copper. Park forecast, “While domestic defense demand may rise slightly, exports are expected to decline significantly, resulting in a projected operating profit of 63.5 billion won in Q3, down 14.6% from a year earlier.”
Nonetheless, he emphasized, “With the defense division now accounting for more than half of the company’s total profit, steady growth in defense sales remains likely. In the short term, copper prices are expected to remain stable, and in the longer term, continued expansion in the defense business is a valid growth driver.”
*[KOSPI] Poongsan(103140), a subsidiary of the Poongsan Group, is divided into the new business sector(production of copper and copper alloy products) and the defense business sector(production of military ammunition, precision forging, etc.). The market capitalization is 3.792 trillion won (as of August 1, 2025, closing price).