With an economy named the most innovative in the world by Bloomberg, South Korea has witnessed immense growth since the 1960s. While the country is often hailed for its tech and automotive sector, its advances in the fields of construction and other forms of engineering have gone mostly unnoticed.
South Korea’s government realizes the strength of its industrial sector in general and has taken steps to not make Korean engineering more globally renowned as a brand, but to develop its ability in these fields even further.
Despite recently becoming one of the world’s top 5 nations in overseas construction, boasting total orders of over US$700 billion, Korea experienced a staggering 30% drop in orders back in 2015. Many attribute this decline to the global economic situation and the price of oil being cut in half, but the South Korean government is taking chances. Earlier this year, the Korean Ministry of Land, Infrastructure, and Transport held a meeting to promote overseas construction, the first of its kind.
The meeting concluded with the allocation of US$2 billion to support Korean companies bidding for construction orders overseas, with a special focus on Iran and collaboration with the Asia Infrastructure Investment Bank (AIIB).
Growing at an impressive pace except for last year, South Korea’s construction industry features a few interesting companies that are doing well and will continue to do so. InvestAsian would like to present the most attractive construction company coming out of South Korea today – SEBO Manufacturing Engineering Corp (KOSDAQ:011560).
Invest in Korean Manufacturing and Engineering with SEBO
A medium sized firm engaged mostly in the construction business, SEBO has 5 business segments that offer a one stop solution to anything construction related. It’s most significant revenue contributing segments are the construction facilities division, high technology facilities division, and overseas division.
SEBO’s services include the manufacturing of custom made parts, installation, and maintenance. Not only does it service homes and office buildings, but it also provides its services to factories and manufacturing plants. SEBO has a strong international customer base all around ASEAN including in Vietnam, the Philippines, and India.
Comfortable Growth, Very Attractive Valuations
There are two reasons why investing in SEBO is the right choice. It is a company with great returns on top of its sound fundamentals.
Despite the global economic downturn, SEBO has managed to keep its profits in the green, although slightly less. Its net profit margin of 4.07% is still above the industry average. Strong financial performance translates directly into high returns for its investors. With ROI and ROE both above 13%, SEBO is indeed handsomely rewarding its shareholders.
Not only is the performance of the company exemplary, the fundamentals are also sound. With a current ratio of over 2 and absolutely no long term debt, the company is in a great place to expand aggressively should it ever see the need to. Selling at 6,400.00 KRW, with a P/E ratio of 5.13, SEBO is a great buy.