Hyosung Heavy Industries (298040.KS) has broken through the 3 million won per share threshold, driven by expectations for high growth in transformer earnings. Closing above 3 million won per share is an extremely rare occurrence in Korean stock market history.
According to Korea Exchange on Monday, Hyosung Heavy Industries closed at 3.058 million won, up 118,000 won (4.01%) from the previous trading day. While the stock reached an intraday high of 3.072 million won on Friday, this marked the first time it closed above 3 million won.
The stock first crossed the 1 million won mark in July last year, earning "emperor stock" status, before surpassing 2 million won on October 30. Considering shares traded around 400,000 won at the start of last year, the price has surged more than sevenfold in a year.
Closing above 3 million won is considered extremely rare. According to Korea Exchange, Welsbridge preferred shares closed at 4.4 million won on September 24, 2009, and SG Chungnam Spinning preferred shares reached 6.2 million won on September 6, 2011. Korea Zinc (010130.KS) closed at 2 million won on December 5, 2024, amid its management control dispute with private equity firm MBK Partners.
Securities firms are raising their target prices for Hyosung Heavy Industries to above 4 million won amid the transformer industry's high growth trajectory. LS Securities raised its target price from 3.5 million won to 4.1 million won this month, while Daishin Securities increased its target from 3.3 million won to 4 million won.
The main driver is the expected expansion of ultra-high voltage transformer orders from the second quarter, which would extend lead times to more than three years. "We applied a significant valuation premium considering the company's fundamental advantages in growth-based performance versus global competitors, favorable conditions in core markets including the U.S. and Korea, and aggressive capacity expansion," said Sung Jong-hwa, analyst at LS Securities.
