The stock fell as low as 150,000 won before recovering to 158,800 won as of around 9:50 a.m.
LS ELECTRIC will supply switchgear to its U.S. subsidiary, which secured a contract to supply power equipment for a hyperscale data center project in the U.S. The deal is equivalent to 3.40 percent of the company's 4.97 trillion won ($3.69 billion) in consolidated revenue in 2025, according to the Korea Exchange (KRX).
Switchgear helps control and distribute electricity safely across large facilities, including data centers that require substantial power to operate. The contract runs from Oct. 16, 2026, through the end of next year.
The latest deal follows a $114.97 million order secured in April for equipment deliveries in 2026 under the same project. With the new contract covering deliveries in 2027, the two deals are worth a combined $240.2 million.
The deal also adds to LS ELECTRIC's business in the North American data center market, where growing demand for AI computing has increased the need for reliable power infrastructure. The company makes transformers, switchgear and power distribution systems used to deliver electricity to industrial facilities and data centers.
However, questions remain over whether massive investments in AI infrastructure will generate sufficient returns. Rising borrowing costs have added to those concerns, putting pressure on companies financing large-scale data center projects.
Those concerns have weighed on technology and AI-related shares in South Korea and overseas. The benchmark KOSPI plunged 7.57 percent last Thursday, as selling pressure intensified. Global chip stocks also came under pressure last week as investors reassessed the outlook for AI spending.
South Korean stocks showed signs of recovery Monday morning, with the benchmark KOSPI rising 0.31 percent or 17.75 points to 5,685.80 as of around 10:20 a.m. from last Friday's close.
LS ELECTRIC, founded in 1974, manufactures power distribution systems, transformers and industrial automation equipment. Its North American business has become an important focus as investment in data centers and electricity infrastructure increases.
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