[Click eStock] "Price Increase Amid Cold Wave"…Korea Gas Corporation Target Price Up 40%

[Asia Economy Reporter Ji Yeon-jin] Hana Financial Investment maintained a buy rating on Korea Gas Corporation, stating that profit adjustments due to changes in natural gas supply costs and rising crude oil LNG prices are expected to lead to operating profits, and announced on the 14th that it raised the target stock price by 40.9% from the previous 62,000 KRW.

Operating profit for the third quarter of this year is expected to turn positive at 15.5 billion KRW. During this period, sales are expected to increase by 82.0% year-on-year to 6.2 trillion KRW. Gas sales volume improvement and increased overseas business sales due to rising crude oil prices are anticipated. The overseas business is estimated to strengthen its profit trend due to strong LNG prices and rising crude oil prices.

Natural gas inventory shortages are emerging not only in Korea but also in China and Europe. If a cold winter like last year occurs, unexpected additional increases in gas prices may be confirmed. Yujeseon, a researcher at Hana Financial Investment, said, "Although Russia's PNG can partially meet European demand, there is a possibility that supply to meet Asian power and heating demand will not be sufficient," adding, "Although it may be linked to the negative factor of increasing accounts receivable, it is highly likely that its value will be highlighted as an asset that can hedge against rising Asian LNG prices."