[Featured Stock] Korea Gas Corporation Rises 4%... Stock Price Strength Continues After Rate Hike

Stabilizing Around 50,000 Won Followed by Upward Trend
Signal of Escaping Poor Performance... Reflecting Expectations of Financial Improvement
Rate Increase During Low Summer Energy Demand Period

Korea Gas Corporation is showing strong performance. Since the price increase in August, the stock price has continued its upward trend.

As of 1:45 PM on the 27th, Korea Gas Corporation's stock is trading at 52,500 won, up 4.37% (2,200 won) compared to the previous day. After breaking the 50,000 won mark for the first time since July 2nd the day before, the stock price has settled above 50,000 won and is gaining even more momentum.

Korea Gas Corporation has been struggling with poor earnings. Last year, it recorded an operating profit of 1.5534 trillion won but posted a net loss of 747.4 billion won. Although the increase in unpaid residential gas fees has slowed, the biggest cause of poor performance was the city gas prices still being supplied below cost.

With the recent increase in city gas prices, a positive signal has been lit for Korea Gas Corporation's earnings. Residential prices rose by 6.8% starting August 1st. Wholesale prices were also raised. This was the first increase in residential and wholesale prices in about a year since May of last year. Korea Gas Corporation emphasized that the price hike was inevitable due to deteriorating financial conditions, including a debt ratio exceeding 600% and annual interest expenses on unpaid fees surpassing 500 billion won. In particular, the August price increase appears to have been timed considering that energy demand is lowest in summer, minimizing the impact.