Robot Stocks Rally Again on Government Investment

Robot-related stocks continue to show strength as the government announced its plan to increase the robot industry budget next year. Last Friday, strong upward momentum was observed, reflecting expectations for improved performance from Robotiis. Additionally, issues related to LG Electronics' Bear Robotics came to the forefront, with LG Electronics rising 6%, drawing significant market attention.

With the Consumer Price Index (CPI) and Producer Price Index (PPI) announcements this week, an event that could impact growth stocks is anticipated, suggesting a cautious approach is needed. In particular, foreign investors are showing a trend of selling robot-related stocks, and some rising stocks are seeing profit-taking with upper shadows, indicating that a short-term reduction in holdings should also be considered.

The government has announced plans to invest over 2 trillion won each in humanoid robots and physical AI demonstration projects by 2030, raising policy expectations. However, it is important to approach component companies with confirmed performance conservatively rather than finished product companies that have not yet shown results. Companies with technological capabilities such as SPG, Robotiis, and Hyundai Mobis are noteworthy.

Reports have emerged that Bear Robotics, in which LG Electronics has management rights, is pursuing a Nasdaq listing. With rumors circulating that Bank of America has been selected as the lead underwriter, expectations are forming in the market that this is not just a simple rumor. The similarity to past cases like Samsung Electronics and Rainbow Robotics, where strategic investments by large corporations led to listings, is also mentioned.

LG Electronics holds a 56.9% stake in Bear Robotics, so if the listing is successful and the company's value is re-evaluated, LG Electronics' stake value is also expected to be significantly re-evaluated. The LG Group has been strengthening its robot-related momentum for the past 5-6 years, demonstrating the group's commitment to the robot business.

Issues such as overlapping listings of subsidiaries need to be carefully considered. Since the robot business's contribution to overall corporate performance is still minimal, performance risks remain. While not bad news for investors, a cautious approach is necessary.

The Korean robot industry needs to target areas that China cannot easily catch up with, one of which is the actuator and precision reducer sector. In particular, there is a technological gap of 5 to 10 years between China and Korea in the precision reducer segment, indicating that the mid-to-long-term competitiveness of domestic robot-related companies is valid.

Robotiis showed very strong performance in the second quarter, with high sales growth rates of around 150% in both the North American and Chinese markets. Its operating profit is also evaluated to have a high likelihood of continuous improvement. However, as the stock price has reached a major resistance level, caution is advised for short-term purchases.

For investors holding Robotiis shares, it would be a wise strategy to consider realizing profits due to the short-term surge and investing additional gains only with spare funds. Production capacity is expected to double next year through expansion, and full-scale performance improvement is anticipated from next year. Therefore, a mid- to long-term approach is recommended.