[Click eStock] "Korea Gas Corporation, Recovering Intrinsic Value Hidden by Donghae Gas Field"

Daishin Securities analyzed on the 3rd that Korea Gas Corporation is recovering its intrinsic value, which had been overshadowed by the Donghae gas field.

Heo Min-ho, a researcher at Daishin Securities, stated in a report on the same day, "The triggers for Korea Gas Corporation's stock price are the company's investment participation in the Donghae gas field project, gas discoveries, and the collection of outstanding receivables," adding, "Although it is impossible to predict the company's investment participation and the amount of gas discovered in the Donghae gas field, the stock price seems to be reflecting these factors in advance."

He continued, "Over time, it will become clear whether these were excessive expectations or properly reflected in advance, but from an analyst's perspective, it is difficult to incorporate this into the valuation," and explained, "However, given the government's favorable gas pricing policy, recent stabilization of oil prices and exchange rates at lower levels, and expectations of interest rate cuts, it is reasonable to anticipate a stock price revaluation due to no increase in outstanding receivables in Q4 this year and a gradual decrease in outstanding receivables after 2025."

He forecasted, "Outstanding receivables are expected to shrink from 15.8 trillion won at the end of last year to 14.4 trillion won at the end of 2024, 14.2 trillion won at the end of 2025, and 13.9 trillion won at the end of 2026," and added, "If oil prices do not rise above the assumed levels in the future, additional collection of outstanding receivables is also possible."

He further predicted, "Considering only the impact of macroeconomic changes, even accounting for a 91 billion won decrease in operating profit and equity-method income from overseas projects due to the decline in applied oil prices in 2025, pre-tax profit is expected to improve by 40 billion won and cash flow by 293 billion won (including the collection of 253 billion won in outstanding receivables)."