Construction Stocks Benefit Most
By Yoon Ja-young
Staff Reporter
Those who invested in shares related with Lee Myung-bak's canal project in January this year could have made over a 750 percent investment return.
Six stocks deemed to benefit from the former Seoul mayor's cross-nation canal plan rose 765 percent on average from the beginning of this year as of Dec. 18. Lee has pledged to build a canal across the country, despite opposition from a number of environmentalist NGOs.
Among these ``Lee Myung-bak shares'' are Sammok Precision, Tuksu Engineering & Construction, Dongshin Construction, Ee-Hwa Construction, Samho Development, and Home Center.
Ee-Hwa Construction, which specializes in civil engineering and construction, is leading the pack of these shares, rising 1,300 percent from the beginning of this year. It recorded 478 million won in operating profit from 32.8 billion won in total sales as of Sept. 30. It surged near 1,500 percent from the 1,835 won bottom price it recorded on Jan. 24.
Samho Development rose over 1,100 percent, and Tuksu Engineering & Construction and Dongshin Construction all rose over 700 percent from January. These shares hit their daily limit on Tuesday, the day before the presidential election. The stock market was closed on election day.
Though betting money on stocks related to Lee Myung-bak would have returned a handsome bonus, analysts didn't recommend such a dangerous wager.
These stocks took a roller-coaster ride through the year at the fluctuations of Lee. The shares plummeted after Kim Kyung-joon, Lee's former business partner involved in a financial fraud case, arrived Seoul from the United States. After the prosecution cleared suspicions that the former Seoul mayor had collaborated with Kim, however, the stocks started skyrocketing again.
The Korea Exchange, the stock market operator, said early this month that it is monitoring Lee Myung-bak stocks for irregular trading, as these had been showing speculative rises. Executives of Ee-Hwa Construction also sold off their stake massively, reflecting that they consider the recent hike irregular.