Hyundai Steel performs well

Sales of steel products from Hyundai Steel remain strong despite a slow domestic construction market, Eugene Investment and Securities noted on December 27, supporting a buy recommendation and a target price of 55,000 won (US $ 49.01).

Revenue in the fourth quarter will grow 79% year-on-year to 4.72 trillion won and operating income is up 10.9% to 331.7 billion won. Although prices will not rise, the profitability of rolled steel will remain stable. However, the domain division will suffer from declining exports and lower prices. Next year is not very optimistic as a sluggish domestic construction market and an influx of lower-priced Chinese goods will undermine its electric furnace steel business, while raw material prices will weigh on blast furnaces, analyst Bang Minjin said.

“Uncertainty looms, but it will focus on protecting its bottom line through operational adjustments. While sales of cold rolled sheet and carbon stainless steel are improving more slowly than expected, margins will be limited, ”the analyst said.