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As Iran war depletes Lockheed stockpiles, markets bet LIG Nex1’s missiles could fill gap

Published: 03 Mar. 2026, 19:20

CHO YONG-JUN
[email protected]

LIG Nex1's medium-range surface-to-air missile, the Cheongung, is launched near the West Sea in 2024. [JOINT CHIEFS OF STAFF]

As the United States and Gulf states rapidly deplete their missile stockpiles at the height of the Iran war, Korean defense firms are emerging as alternative suppliers of more cost-effective air defense systems.

Iran’s retaliatory missile and drone attacks following the joint U.S. and Israeli attack on Iran on Saturday impressed upon neighboring nations the urgent need to fortify air defenses, as multiple missile interceptors are often required to nullify a single incoming attack.

But with Lockheed Martin’s limited supply of high-end interceptors like the Terminal High Altitude Area Defense (Thaad) and Patriot PAC-3 missile segment enhancement systems, the United States has already deployed Korea’s medium-range surface-to-air missile (M-SAM) developed by LIG Nex1 in the war, according to SBS, quoting Korean government officials.

LIG Nex1's shares skyrocketed 29.86 percent to close at 661,000 won ($448) on Tuesday with the prospect of multibillion-dollar deals in the Middle East for the Cheongung-II, also called the M-SAM II.

“The Cheongung-II and its price effectiveness and rapid delivery times will allow it to emerge as a medium-altitude air defense system capable of complementing the highly expensive and supply-constrained Patriot,” Hana Securities analyst Chae Un-sam said on Tuesday.

The Cheongung is a medium-range surface-to-air missile that was created with the aim of locally sourcing a missile system. The Block-II variation of the M-SAM was deployed by the Korean Air Force in 2020, and the manufacturer has signed deals to export the M-SAM II to the United Arab Emirates (UAE), Saudi Arabia and Iraq from 2021.

The defense firm also works with Hanwha Aerospace on the manufacture of the launchers, while Hanwha Systems is responsible for the multifunction radar fitted to the missile system.

LIG Nex1's medium-range surface-to-air missile, the Cheongung, is displayed at the Agency for Defense Development in 2020. [YONHAP]

Chae has pointed out that despite Lockheed's recent announcement of an increase in its munition production, the U.S.-based defense manufacturer is still only capable of producing 96 Thaad missiles and 600 Patriot missiles each year. Iran is known to have fired 700-plus missiles and thousands of drones at the UAE, Qatar, Bahrain and Kuwait — where U.S. bases are located — so far, requiring hundreds of antimissiles to intercept the incoming projectiles.

Eugene Investment & Securities analyst Yang Seung-yoon also pointed out that the United States had “used up most of its Thaad missiles” during its strike on Iranian nuclear sites in June of last year and said the UAE and Qatar will have run out of interceptor missiles "in a few days.”

“The fast depletion of antimissile in the Middle East is expected to fuel demand in replenishing the supply,” the analyst said Tuesday.

LIG Nex1 is expected to benefit from the situation, with the price of the M-SAM II around 50 percent of that of Patriot missiles. The company began manufacturing M-SAM missile systems for the UAE in late 2024 and is currently expected to have begun the delivery of the system. While it is unclear whether the M-SAM missiles actively intercepted Iranian missiles, usage is expected to increase as time goes on.

“Given that the system is still in its initial deployment phase, the likelihood of an immediate, full-scale combat use of the M-SAM is low, but the possibility of deployment still exists, depending on local air defense requirements,” Yang said.

LIG Nex1 declined to confirm the details of M-SAM deployment in exporting nations or whether the systems are in active use, but said that it is “aware of the current situation.”

“The company is aware of the rise in interest [in M-SAM], but we are unable to disclose further information about the matter.”

BY CHO YONG-JUN [[email protected]]