[Click eStock] "Hyundai Steel, Significant Performance Improvement from Q4"

[Asia Economy Reporter Park Jihwan] Samsung Securities analyzed on the 29th that Hyundai Steel succeeded in defending its earnings in the second quarter of this year, but meaningful improvement is expected from the fourth quarter. Accordingly, it presented a 'Buy' investment opinion and a target price of 25,000 KRW.

Baek Jaeseung, a researcher at Samsung Securities, stated, "The consolidated operating profit for the second quarter turned positive at 14 billion KRW," adding, "Despite weakness in flat products, the strong performance of long products and the reflection of unrealized gains from the overseas SSC business exceeded market expectations."

It was analyzed that although the sales of automotive steel sheets and ASP decline in the flat products business were inevitable due to the impact of the novel coronavirus disease (COVID-19), the long products business rather showed an expanded spread.

Although overseas SSC performance remains weak, considering that Hyundai-Kia car sales are recovering in most regions except China, gradual improvement is expected in both the parent company and overseas SSC performance due to the recovery of automotive steel sheet volume.

Researcher Baek forecasted, "Considering both sales volume and spread changes, third-quarter earnings are likely to remain at a similar level compared to the previous quarter," and added, "Substantial earnings recovery will begin in earnest from the fourth quarter."

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