[Click eStock] "Zinc Price Strengthens... Korea Zinc Target Price Maintained at 710,000 Won"

[Asia Economy Reporter Ji Yeon-jin] Eugene Investment & Securities stated on the 28th that it maintains a buy rating and a target price of 710,000 KRW for Korea Zinc, citing that smelting production disruptions in China and Europe will support the strong zinc prices.

Bang Min-jin, a researcher at Eugene Investment Research, said, "Recently, due to smelting production disruptions in China and Europe, LME zinc prices have risen significantly, and zinc prices are currently at $3,400 per ton, expected to be about 11% higher in the fourth quarter compared to the previous quarter," adding, "The potential improvement in Korea Zinc's core business value next year and expectations for expansion in new growth businesses remain valid."

Korea Zinc's consolidated sales for the third quarter of this year increased by 22.2% year-on-year to 2.41 trillion KRW, and operating profit rose by 0.6% to 265.8 billion KRW. During this period, separate sales increased by 20.6% to 1.7 trillion KRW, and operating profit grew by 3.3% to 218.9 billion KRW.

Although lead shipments decreased by 11.9% year-on-year due to marine transport disruptions, external growth continued thanks to rising metal prices. The average annual shipment price of lead rose by 22.5% year-on-year, and zinc prices (+27.5%) also showed strength. Free Metal profits offset the decline in zinc smelting fee income.

However, Bang noted that future performance may be affected as customer inventories increase due to marine transport disruptions, potentially impacting Korea Zinc's shipments following the third quarter.