[Click eStock] Hyundai Steel Still Undervalued with Strong Performance This Year, Target Price Up 17%

[Asia Economy Reporter Lee Seon-ae] NH Investment & Securities announced on the 20th that Hyundai Steel is still undervalued despite expectations of improved earnings, maintaining a 'Buy' rating and raising the target price by 17% to 55,000 KRW.

Hyundai Steel's consolidated operating profit for the fourth quarter is expected to fall short of market expectations due to increased labor costs in 2020 and losses related to asset sales. However, strong performance is anticipated this year due to expected price increases for automotive steel sheets and higher sales volume of cold-rolled steel.

Hyundai Steel's consolidated sales for this year are expected to grow 13.3% year-on-year to 20.5773 trillion KRW. Operating profit is projected to increase 476.6% during the same period to 605.3 billion KRW, and net profit is expected to turn positive at 114 billion KRW.

Byun Jong-man, a researcher at NH Investment & Securities, explained, "Supported by the global economic recovery, the upward trend in international steel prices is expected to contribute to earnings," adding, "The company is establishing an ESG (Environmental, Social, and Governance)-focused management system and plans to expand supply of eco-friendly automotive materials and hydrogen production capacity in the long term."