Ajusteel

Aju Steel began as a steel distribution business in 1995 and transformed into a manufacturer in 2008 when it completed its first color-coated steel line, becoming a specialized color-coated steel producer.

Under brand names such as Texteel and Suslike, the company has been credited with developing a range of novel steel-surface design and manufacturing methods.

It supplies high-margin, premium color-coated steel for appliances to global electronics makers Samsung Electronics and LG Electronics, with color-coated steel for video appliances (TVs) accounting for 33.2% of revenue and for household appliances (refrigerators, washing machines) for 17.4%, together making up 50.6% of total sales.

With annual production capacity of about 280,000 tons, Aju Steel ranks fourth domestically in color-coated steel, in a market led by KG Steel, followed by Dongkuk CM, POSCO Steeleon, and then Aju Steel.

Overseas, its Mexican subsidiary produces roll-formed products for trailers, supplying an affiliate of Hyundai Motor's logistics network, giving the company an automotive materials line as well.

In August 2024, Dongkuk CM, the cold-rolled and color-coated steel affiliate of the Dongkuk Steel Group, decided to acquire a stake in Aju Steel, and completed the acquisition process in January 2025 after paying for both existing and newly issued shares, making Dongkuk CM the largest shareholder.

Dongkuk CM stated the acquisition made it the world's largest color-coated steel group by production volume. Following the acquisition, Aju Steel transitioned to a new CEO, Lee Hyun-sik, and Dongkuk CM's post-merger integration team has been working on improving the balance sheet and restructuring operations.

Aju Steel posted a modest annual profit in 2022, with revenue of KRW 1.056tn, operating profit of KRW 4.6bn (operating margin 0.4%), and owners' net income of KRW 1.3bn, before swinging into losses for three consecutive years.

In 2023, revenue fell to KRW 956.5bn with an operating loss of KRW 19.1bn (-2.0%) and an owners' net loss of KRW 31.4bn, and in 2024, despite revenue of KRW 999.7bn, the operating loss widened to KRW 42.4bn (-4.2%) while the owners' net loss expanded to KRW 108.2bn, the largest loss of the four years shown.

In 2025, revenue recovered to KRW 1.086tn, up 8.6% year over year, but the loss trend persisted, with an operating loss of KRW 25.6bn (-2.4%) and an owners' net loss of KRW 41.2bn.

On a quarterly basis, the operating loss of KRW 4.8bn in 2025Q2 turned into an operating profit of KRW 5.9bn in 2025Q3, before reverting to a sizable operating loss of KRW 19.9bn and an owners' net loss of KRW 21.2bn in 2025Q4.

In 2026Q1, the operating loss narrowed sharply to about KRW 0.9bn, and 2026Q2 turned operating profit positive again at KRW 1.1bn, though the owners' net loss stood at KRW 8.8bn, a notable gap likely reflecting non-operating financial costs or other below-the-line items.

Summing the most recent four quarters from 2025Q3 through 2026Q2, the owners' net loss totals roughly KRW 36.5bn, indicating profits and losses have alternated quarter to quarter without settling into a sustained profit trend.

On the cash flow side, operating cash flow turned negative again in 2025 at -KRW 19.5bn, reversing the positive flows seen in 2023 (KRW 26.7bn) and 2024 (KRW 37.0bn).

In the domestic color-coated steel market, KG Steel ranks first, Dongkuk CM second, followed by POSCO Steeleon and then Aju Steel, which holds the fourth position with roughly 280,000 tons of annual production capacity.

However, demand itself has stagnated: domestic color-coated steel sales in 2025 totaled about 1.0588 million tons, down 8.4% from the prior year. A prolonged downturn in construction and building-materials demand, key end markets for exterior cladding and elevator interior panels, is cited as a key reason.

Separately, the government has imposed provisional anti-dumping duties on Chinese galvanized and color-coated steel from June 12 to October 12, 2026, a measure the market views as likely to have a meaningful impact on distribution channels for color-coated and coated construction steel.

Even so, some market observers caution that low-priced volumes stockpiled ahead of the tariff remain in the market, so the initial effect is likely to ease downward price pressure rather than trigger a sharp price surge.

Externally, US steel tariffs are already set at a high level, and industry calls for renegotiation are seen as unlikely to be realized.

Combined with the EU's Carbon Border Adjustment Mechanism taking full effect from 2026, some observers expect that price competitiveness alone will no longer suffice for exports, with low-carbon production credentials effectively functioning as a non-tariff barrier.

Against this backdrop, Aju Steel remains a later entrant in the color-coated steel industry, while seeking to strengthen its competitive position through the economies of scale and purchasing power gained from its integration into the Dongkuk CM group.

Through its acquisition of Aju Steel, Dongkuk CM has set a mid-term goal of solidifying a 1-million-ton annual color-coated steel production system, achieving revenue of KRW 3.2tn, and an operating margin above 5% within five years.

To reach these goals, it has outlined synergies including cost reductions in production, stronger purchasing power through integrated raw-material procurement, expanded export bases in Poland and Mexico, and strengthened B2C capabilities in products such as fire doors and elevator doors.

On execution, Aju Steel disclosed that it completed installation of a galvalume pot on the CGCL line at its Gimcheon plant at the end of December 2025, and has been fully operating the CGCL line to produce galvalume (G/L) and galvanized (G/I) steel since January 1, 2026.

This is interpreted as a move to broaden the product lineup beyond its traditional color-coated steel focus into coated-steel categories.

The company has also built a low-carbon color-coated steel production line that cuts carbon emissions by 57% versus its prior process, and expects exports of low-carbon color-coated steel to increase in response to the EU's Carbon Border Adjustment Mechanism taking effect from 2026.

On the financing side, in January 2026 the company issued a small private exchangeable bond (KRW 2.89bn) backed by treasury shares to fund operations, and Dongkuk CM is reportedly reviewing balance-sheet measures at the group level, including reducing short-term borrowings, improving borrowing rates, and refinancing.

However, the pace and scale at which these plans translate into actual earnings improvement will need to be confirmed sequentially through upcoming quarterly results and disclosures.