[Click eStock] "Hyundai Steel Lowers Q4 Operating Profit Forecast"

Sangsangin Securities evaluated on the 28th that demand improvement for Hyundai Steel is expected in the second half of next year, with the key factor being the speed of improvement. They maintained a 'Buy' investment rating and a target price of 38,000 KRW.

Researcher Jinbeom Kim of Sangsangin Securities stated, "The stock price of Hyundai Steel depends on expectations of additional stimulus measures in China and the speed of earnings recovery due to the domestic construction market recovery."

Hyundai Steel's operating profit for the third quarter fell 77.5% year-on-year to 51.5 billion KRW, missing the consensus estimate of 97.1 billion KRW. Researcher Kim lowered the fourth quarter operating profit estimate from 147.7 billion KRW to 81.4 billion KRW.

He pointed out, "We expected demand improvement for long products in the second half due to domestic public sector construction and government stimulus measures, but demand weakness in the construction sector continues due to construction cost burdens and ongoing economic recession."

He added, "This year's rebar sales volume is expected to be around 7 to 8 million tons, falling short of the average sales volume of 9.5 million tons over the past 10 years. The steel industry's worsening demand weakness has already been reflected in the stock price, and since a turnaround in the market trend is expected next year, a buy perspective remains valid."