SeAH Besteel Q1 Earnings Outlook Up... Securities Firms Also Raise Target Price

[Asia Economy Reporter Jang Hyowon] As SeAH Besteel is expected to achieve strong performance in the first quarter of this year, securities firms are raising their target stock prices.

On the 20th, BNK Investment & Securities raised SeAH Besteel's target stock price by 3,500 KRW (19.4%) from the previous 18,000 KRW to 21,500 KRW. Earlier, on the 18th, Hyundai Motor Securities also set a target price of 20,800 KRW, raising it by 43.6% from the previous 14,500 KRW. On the 8th, Shinhan Financial Investment also adjusted the target price upward by 23.5% to 21,000 KRW.

As of the closing price on the 19th, SeAH Besteel closed at 16,900 KRW, up 1.81% from the previous day. This means there is about 23-27% upside potential remaining to reach the target prices set by securities firms.

SeAH Besteel Gunsan Plant.

The reason securities firms have collectively raised their target prices is the expectation that SeAH Besteel will post strong earnings in the first quarter of this year. According to financial information provider FnGuide, the consensus operating profit for SeAH Besteel in Q1 is expected to be 26.5 billion KRW, a 145.4% increase compared to the same period last year.

SeAH Besteel is a company specializing in the production and sale of carbon alloy special steel. Its subsidiaries include SeAH Cheongwon Special Steel, which mainly operates in stainless special steel, and SeAH Aerospace & Defense Materials, making it a steel specialist company.

In the first quarter, it is expected to record the highest quarterly performance since the second half of 2018, driven by improvements in separate profit and loss due to the strong performance of the special steel core business and improved results from its subsidiary Changwon Special Steel.

Hyunwook Park, a researcher at Hyundai Motor Securities, analyzed, "The reason for the expected significant improvement in performance is the anticipated recovery in demand from front industries such as construction, machinery, and heavy equipment, as well as stabilization in automobile sales, which had decreased last year. Additionally, the price increase of special steel, the main product, supported by the global steel price strength, will also contribute."

Along with the recovery of the special steel core business, the improved performance of non-steel subsidiaries such as Changwon Special Steel and Aerospace & Defense Materials is expected to further stabilize the business portfolio.

Hyuntae Kim, a researcher at BNK Investment & Securities, stated, "Aerospace & Defense Materials maintained solid performance with an operating profit of 1.9 billion KRW even in the fourth quarter of last year. It is expected that the profit contribution will increase further as the aerospace industry conditions improve."

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