[Click eStock] "Ssangyong Cement, Dividend Expansion Expected with Market Improvement and Eco-Friendly Investment"

[Asia Economy Reporter Oh Ju-yeon] NH Investment & Securities analyzed that Ssangyong Cement is expected to expand dividends due to the improvement in the cement industry and eco-friendly investments, with a dividend yield of about 7% based on the 2021 dividend per share and current stock price.

According to NH Investment & Securities on the 10th, Ssangyong Cement's operating profit for next year is expected to increase by 16.9% to 286.8 billion KRW compared to this year. This reflects the possibility of cement price increases in the second half of 2021, deferred volume (2 million tons) due to COVID-19 and the rainy season this year, and the effect of full operation of all four recycling resource processing facilities in 2021.

Researcher Min-jae Lee stated, "The four recycling resource processing facilities completed in 2020 are expected to reduce the proportion of bituminous coal usage," and estimated that "bituminous coal usage will decrease from over 1 million tons annually to below 700,000 tons." Accordingly, it is explained that cost savings of more than 60 billion KRW in 2021 could occur due to 35 billion KRW reduction in costs from decreased bituminous coal usage, 20 billion KRW increase in recycling resource processing fee income, and 10 billion KRW reduction in depreciation expenses.

Additionally, the recycling resource processing business is expected to be an additional positive factor that can create a positive perception of "cement = eco-friendly" and also expect cost savings.

Researcher Lee added, "In the mid to long term, the proportion of recycling resources (excluding Pet-coke) is expected to increase to over 40% due to additional investments," and explained, "The amount of waste plastic that the cement industry can process annually is 2 million tons (assuming a 30% recycling resource processing rate), and it is expected that more than this will be possible with expanded investment in recycling resource processing facilities."

He continued, "Not only strengthened profit resilience but also the possibility of dividend expansion is expected, with a dividend yield of about 7% based on the 2021 dividend per share and current stock price," maintaining a buy investment opinion on Ssangyong Cement and raising the target stock price from 7,000 KRW to 8,500 KRW.

This content was produced with the assistance of AI translation services.