iM Securities on the 29th said LS is expected to benefit from rising copper prices and to see higher valuation (share price gains relative to earnings) from the retirement of treasury shares. It maintained a Buy rating and raised its target price to 250,000 won. LS closed the previous trading day at 189,200 won.
iM Securities explained that most of LS's subsidiaries have a very high correlation with copper prices due to their business structures. In particular, for companies such as LS Cable & System and LS I&D, product prices are linked to copper prices to some extent, so when copper prices rise, the effect of future earnings improvement becomes visible and benefits are expected.
Copper, which had been on a rising streak, reached $12,253 per ton on the 24th at the London Metal Exchange (LME). This year's copper price increase stands at 40.7%, and it is expected to mark the biggest annual rise since 2009.
Lee Sang-heon, a researcher at iM Securities, said, "Importers and manufacturers are moving preemptively to secure volumes in anticipation that the U.S. Trump administration may impose a tariff on copper next year," adding, "In this situation, short-term supply shortages caused by successive operational disruptions at mines are driving up copper prices, and as the spread of the artificial intelligence (AI) industry accelerates data center and power grid expansions worldwide, copper demand will increase in the mid to long term."
In addition, as the third amendment to the Commercial Act, centered on the principle of retiring treasury shares, has a high chance of passing in January next year, LS holds 12.5% in treasury shares.
The researcher said, "For LS, it will be inevitable to retire a significant portion of the 12.5% in treasury shares it holds," adding, "Such retirements could lay the groundwork for higher valuation."