[Click e-Stock] "Dongbu Corporation: From Housing to Industrial Plants... Performance Growth Expected"

Shinhan Investment Corp. Sets Target Price for Dongbu Corporation at 15,000 Won

On September 16, Shinhan Investment Corp. initiated coverage on Dongbu Corporation, stating that growth is expected based on its business portfolio spanning housing and industrial plant sectors. The firm set a new target price of 15,000 won and a 'Buy' investment rating.

Senior Researcher Kim Sunmi and Researcher Kim Doyeon explained, "Although the share price turned weak due to disappointing results in the first half compared to the aggressive performance guidance at the beginning of the year, Dongbu Corporation maintains a favorable business portfolio with expansion into mid-to-small-sized housing in the Seoul metropolitan area as well as industrial plants. Therefore, expectations for a turnaround in performance remain valid." They further added, "Mid-sized firms are also expected to benefit from the domestic construction investment upcycle, which is anticipated to become visible from 2027 onward."

Dongbu Corporation’s performance in the first half of the year was somewhat disappointing, but improvement is expected on a quarterly basis from the second half onward. This is attributed to an increase in orders for industrial plants, which are quickly converted to revenue. Shinhan Investment Corp. noted, "Dongbu Corporation is targeting more than 500 billion won in orders this year, having recorded 90 billion won in the first half. With the increase in industrial plant orders, first-half plant revenue grew by 55% year-over-year."

The firm added, "As the proportion of revenue from high-value-added advanced facility projects increases, both revenue and operating profit in the plant segment are expected to grow simultaneously."

With growing orders for small-scale maintenance projects such as Moa Towns and street housing redevelopment, housing construction starts based on the company's brand 'Centreville Astarium' are also on the rise. Moreover, the company is targeting orders of approximately 1 trillion won for private participation public housing projects last year and 800 billion won this year, suggesting mid-to-long-term results will also be positive.

Shinhan Investment Corp. stated, "Fluctuations in performance were a reason for discounted share prices in the past, but with stable performance growth now confirmed, valuation improvement is expected."

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