Lig Defense&Aerospace Co., Ltd. (079550)

**Business Overview** LIG Defense & Aerospace, established in 1998, is a leading comprehensive defense company in South Korea, which changed its name from LIG Nex1 to its current name in March 2026. The company's main business involves the development and mass production of advanced weapon systems across various defense sectors, including Precision Guided Munitions (PGM), Intelligence, Surveillance, and Reconnaissance (ISR), Avionics/Electronic Warfare (AEW), and Command, Control, Communications, Computers, and Intelligence (C4I). Key products include the Cheongung-II (KM-SAM), a medium-range surface-to-air guided missile known as the 'Korean Patriot'; the Hyungung (ATGM), an anti-tank guided missile; the Haegung (K-SAAM), a ship-to-air guided missile; and AESA radar for the FA-50 light attack aircraft. As of Q3 2025, the Precision Guided Munitions (PGM) segment is the primary business segment, accounting for approximately 47.5% of total revenue. Major customers include domestic government agencies such as the Defense Acquisition Program Administration (DAPA) and the Agency for Defense Development (ADD). The company is expanding its overseas exports, primarily to Middle Eastern countries such as the United Arab Emirates (UAE), Saudi Arabia, and Iraq. **Core Competitiveness** LIG Defense & Aerospace possesses unique domestic technological capabilities and a de facto monopolistic position in the development of advanced guided weapons and torpedoes, such as the Cheongung-II. By internalizing key missile technologies, including seekers and guidance control systems, the company has established high entry barriers. As of the end of 2025, its substantial order backlog of KRW 26.23 trillion provides revenue visibility for the next 7-8 years. The high proportion of high-profitability export contracts within this backlog is expected to lead to structural improvements in profit margins. Furthermore, the company maintains a competitive edge in the global market through efficient production costs relative to its high technological capabilities and its ability to develop customized solutions for clients. It is also securing future growth engines by expanding its business portfolio into unmanned systems and space sectors. **Performance Analysis** LIG Defense & Aerospace has recorded robust revenue growth in recent years. Revenue consistently grew from KRW 2.2208 trillion in 2022 to KRW 2.3086 trillion in 2023 (up 3.95% year-over-year), KRW 3.2763 trillion in 2024 (up 42.09% year-over-year), and KRW 4.3069 trillion in 2025 (up 31.45% year-over-year). Operating income also significantly increased from KRW 179.1 billion in 2022 to KRW 319.4 billion in 2025, with a notable 43.06% increase year-over-year in 2025. In Q1 2026, revenue reached KRW 1.1679 trillion and operating income was KRW 171.1 billion, marking strong performance with year-over-year increases of 28.7% and 56.1%, respectively. The operating profit margin was 8.06% in 2022, 8.07% in 2023, 6.82% in 2024, and 7.42% in 2025, showing significant improvement to 14.65% in Q1 2026. **Financial Soundness** Examining the company's financial soundness, the debt-to-equity ratio has been on an upward trend, increasing from 222.16% in 2022 to 446.35% in 2025. The current ratio slightly decreased from 95.97% in 2022 to 90.45% in 2025 but has remained above 90%. Return on Equity (ROE) rose from 13.15% in 2022 to 16.63% in 2023 and 16.83% in 2024, then recorded 16.09% in 2025, maintaining sound profitability. **Outlook** LIG Defense & Aerospace is expected to achieve sustained growth amidst an expanding defense industry market and an unstable global security environment. In particular, the urgent increase in missile demand in the Middle East and the proven combat performance of the Cheongung-II are expected to positively impact future export expansion. Furthermore, the company plans to diversify its business portfolio and emerge as a global comprehensive defense company by strengthening its unmanned systems capabilities through the acquisition of Ghost Robotics, a specialist in quadrupedal robots, and by investing in future defense sectors such as satellite systems and next-generation airborne weapon systems.