[Click e Stocks] Hyundai Steel, Expectations for Negotiation Results with Actual Demand

[Asia Economy Reporter Junho Hwang] Meritz Securities maintained its buy rating and target price of 67,000 KRW for Hyundai Steel on the 28th.

Meritz Securities highly evaluated Hyundai Steel's operating profit of 545.3 billion KRW in the second quarter, which increased by 3804.4% compared to the previous year, despite a non-operating loss of about 40 billion KRW due to a major accident. Hyundai Steel's separate operating profit was 483.7 billion KRW, which was in line with market expectations.

Meritz Securities also saw a high possibility of spread improvement for Hyundai Steel in the third quarter of this year. In particular, they expected the negotiation results for actual demand in the flat steel segment. It is anticipated that a price increase for export volumes to Hyundai Motor Company will be decided during the third quarter, and in the fourth quarter, domestic volumes for Hyundai Motor Company are likely to see another price increase following the first half. The price of thick plates for shipbuilding is also expected to be raised once more in the second half, with an increase of about 20,000 to 30,000 KRW per ton projected.

Researcher Mungyeongwon from Meritz Securities explained, "Recently, China's government has strengthened its production cut policies beyond expectations, causing steel prices in the region to rebound," adding, "Although downside risks remain on the demand side, a short-term buying response is a wise strategy."

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