[Click eStock] Kumho Petrochemical, Synthetic Rubber Market Improves... Target Price Raised to 210,000 Won

On the 10th, Korea Investment & Securities raised the target price for Shinsegae by 17% to 210,000 KRW, reflecting improvements in the synthetic rubber market conditions. The investment rating was maintained at 'Buy.'

Choi Go-woon, a researcher at Korea Investment & Securities, stated in a report on the same day, "We are raising the target price by 17%, from the previous 180,000 KRW to 210,000 KRW, reflecting the potential for an increase in synthetic rubber spreads. We recommend buying not only because of its stable profit generation in the challenging chemical industry but also because it is the most proactive company in shareholder returns."

On the 9th, Kumho Petrochemical closed trading at 156,400 KRW.

Kumho Petrochemical's second-quarter sales are estimated at 1.8 trillion KRW, with an operating profit of 95 billion KRW. The operating profit is expected to exceed the consensus by 11%.

Researcher Choi Go-woon said, "With the most important synthetic rubber performance improving, it will show a clear profit turnaround following the first quarter. The operating profit from synthetic rubber is expected to increase significantly to 37 billion KRW."

He also expects the improvement trend in synthetic rubber operating profit to continue into the second half of the year. Researcher Choi Go-woon analyzed, "Operating profit from synthetic rubber will increase for two consecutive quarters, clearly indicating a market turnaround. Considering the recovery in front-end tire demand, limited capacity expansion, and overall natural rubber supply shortages, this spread improvement is expected to continue in the second half."