Sewon Metal Signs Win-Win Partnership Agreement with Samyang Specialty Steel… Targeting Niche Markets with Specialized Products

SeAH Besteel, a leading maker of specialty steel represented by CEOs Yoon Ki-soo and Lee Tae-sung, has begun strengthening cooperation with client companies to develop and expand sales of specialized steel products. This move is seen as a strategy to respond to Hyundai Steel’s entry into the specialty steel market and to broaden its supply channels to global OEMs.

On the 18th, SeAH Besteel announced that it had signed a mutual growth and cooperation agreement with Sewon Metal Co., Ltd., a hot forging parts manufacturer, and Samyang Specialty Steel Co., Ltd., a major specialty steel distributor.

SeAH Besteel plans to proactively meet customer needs through the development of optimized products for specific applications. To this end, the company has selected six specialized steel product categories: ultra-clean bearing steel, low-deformation heat-treated steel, wear-resistant steel, high-impact toughness steel, low anisotropy steel, and defect-free bars—and is focusing its capabilities on their development.

Since the operation of Hyundai Steel’s specialty steel plant in Dangjin, existing players in the market have grown increasingly concerned about heightened competition. Many fear that Hyundai Motor Group’s vertical integration strategy could further shrink domestic market share for non-affiliated suppliers.

The recent agreement between SeAH Besteel and its client companies is viewed as an effort to overcome such challenges. By developing specialized products and establishing a strong brand presence, SeAH is expected to aggressively pursue niche market opportunities.

Currently, over 20% of the specialty steel used by domestic automakers comes from SeAH Besteel’s independently developed materials. Based on this competitive edge, the company is expanding its reach in overseas markets by signing contracts with OEM suppliers to global automotive manufacturers.

This year’s performance outlook is also positive.

Park Jong-guk, a researcher at Kiwoom Securities, projected in a recent report that SeAH Besteel will post solid earnings in the second quarter, continuing its momentum from Q1. He estimated consolidated revenue at KRW 764.4 billion and operating profit at KRW 53.3 billion, up 27.1% and 15.5% year-over-year, respectively.

For Q3, he forecasted consolidated revenue of KRW 687.9 billion and operating profit of KRW 43.3 billion, reflecting year-over-year growth of 11.1% and 4.6%.“

The ongoing recovery in sales volumes since Q1 and price hikes implemented in Q2 likely drove the improved results,” said Park.

Samyang Specialty Steel, which signed the mutual growth agreement with SeAH Besteel, is Korea’s largest specialty steel distributor, established in 1966. It has long been a top-performing dealership and trusted partner of SeAH Besteel.

Founded in 1995, Sewon Metal is a specialist in hot forging, producing parts for automobiles, ships, and industrial machinery. The company is a recognized leader in forging technology and exports 55% of its sales to global automotive manufacturers. In 2015, it received the Minister of Trade, Industry and Energy Award in the materials and components sector.

Source: EBN News Center (https://www.ebn.co.kr)