Table of Contents

1. What Happened?

Chosun Refractories signed a $560 million supply contract with POSCO on September 24, 2025. The contract will run for one year, from October 1, 2025, to September 30, 2026. This represents a significant portion (14.91%) of Chosun Refractories’ 2024 annual revenue.

2. Why Does It Matter?

This deal offers a crucial opportunity for Chosun Refractories to rebound from a sluggish first half of 2025. The substantial $560 million contract is expected to boost not only revenue but also operating profit and net income. Securing a stable revenue stream also sends a positive signal to investors, potentially driving stock price momentum.

3. What’s the Likely Impact?

Positive Aspects:

  • Increased revenue and improved profitability
  • Enhanced cash flow
  • Strengthened relationship with a key client
  • Potential for upward stock price movement

Potential Risks:

  • Increased dependence on POSCO
  • Pressure on profit margins due to rising raw material prices
  • Potential for unforeseen issues during contract execution
  • Possibility of a gap between market expectations and actual profits

4. What Should Investors Do?

Investors should carefully consider the following:

  • Review the specific terms of the contract and projected profit margins.
  • Assess Chosun Refractories’ cost management capabilities.
  • Consider the likelihood of additional contracts with POSCO.
  • Analyze the performance and potential synergies of other business segments beyond refractories.