[Click eStock] “SG, Focus on Ukraine Reconstruction Stocks Following US Presidential Election Results”

On the 7th, SK Securities analyzed that SG's performance improvement is expected through participation in the Ukraine reconstruction project as the possibility of an early end to the Ukraine war expands following Trump's election in the 47th U.S. presidential election. No investment opinion or target price was provided.

Heo Seon-jae, a researcher at SK Securities, explained, "SG is the No. 1 asphalt concrete (Ascon) company in Korea and is expected to generate significant profits through participation in the Ukraine reconstruction project. It has already secured orders worth a total of 35 billion KRW from two local Ascon producers in Ukraine last year and January this year, and in July announced a joint plan with POSCO International to promote road restoration projects."

Ascon hardens below a certain temperature and lacks product differentiation, making overseas expansion difficult and known as a domestic market-oriented business. In preparation, SG filed a patent for ‘Eco Steel Ascon’ in Ukraine in May last year. Eco Steel Ascon is an eco-friendly, low-cost, and high-strength product produced by recycling slag, a steel byproduct, effectively solving Ukraine’s slag disposal problem, a major steel-producing country.

Researcher Heo stated, "After conducting a road demonstration paving test in the fourth quarter of this year, large-scale orders and revenue recognition are expected to begin in the first quarter of next year," adding, "In the mid to long term, the goal is to generate Eco Steel Ascon sales at least at the trillion KRW level in Ukraine."

He added, "The Ukraine reconstruction project is only part of the company's overseas expansion plan; the essence of growth lies in penetrating new markets such as Ukraine, India, and Indonesia through Eco Steel Ascon," and explained, "Since Ascon-related regulations were eased for the first time in four years starting February this year, domestic performance is also expected to recover."

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