Coway enjoys growth on solid sales in Malaysia

Coway's P-series air conditioner / Captured from Coway Malaysia website

Home appliance maker and rental company Coway is expecting a robust first quarter, as its business in Malaysia is driving overall profitability growth in its overseas operations.

As of Monday, brokerages expect Coway to post 1.3 trillion won ($873 million) in sales and 233.4 billion won in operating profit for the first quarter, up 10.6 percent and 10.5 percent, respectively.

The balanced growth in both sales and operating profit is expected to be driven not only by its domestic business but also by its overseas operations, particularly the Malaysia market.

According to the company, its Malaysian unit posted 373 billion won in sales and 56.2 billion won in operating profit during the fourth quarter of last year, achieving 20.9 percent and 6.8 percent year-on-year growth, respectively.

Meritz Securities analyst Park Jong-dae expected the company’s Malaysia unit will post around 20 percent year-on-year revenue growth in the first quarter, highlighting that air conditioner sales have been rising quickly.

Coway’s core business includes the rental of water purifiers, air purifiers and other home appliances. In Malaysia, where water infrastructure was relatively underdeveloped in the past, the company quickly gained a foothold by offering regular filter replacement and maintenance services through its rental coordinators.

Building on its water purifier business, air conditioners have emerged as a new growth driver.

Coway entered the Malaysian market in 2023. Due to local climate conditions, air conditioner penetration is high in Malaysia, but the company had to compete with established players, including Samsung Electronics and LG Electronics. Coway differentiated itself through its rental and care service model, offering consumers a more cost-efficient option.

The company also focused on wall-mounted air conditioners tailored to local demand, which helped streamline its product lineup and improve cost efficiency.

“Coway’s Malaysian air conditioner sales are growing by more than 30 percent year-on-year, and the brand is considered to have higher recognition than LG Electronics in the local market,” Park said.

Coway posted 4.96 trillion won in sales last year, of which 1.4 trillion won came from its Malaysia unit, accounting for approximately 28 percent. While its Thailand unit accounts for a smaller share, it is also expected to post around 30 percent revenue growth, indicating that overseas operations are driving the company’s overall top-line expansion.

“Coway Malaysia has established itself as an integrated wellness brand beyond water purifiers and air purifiers, backed by a successful localization strategy,” a company official said. “Leveraging brand reputation and service infrastructure built through water purifier business, the company is accelerating its expansion into new product categories.”