SK Innovation Target Price 410,000 Won... 76% Up
[Asia Economy Reporter So-yeon Park] Yuanta Securities has issued a buy rating for SK Innovation, setting a target price of 410,000 KRW, which is 76% higher than the current stock price.
According to FN Guide on the 7th, researcher Hwang Kyu-won of Yuanta Securities released a recent report stating, "Next year will be the year of battery profitability turnaround," and "The strong cycle in the refining sector that began in September this year is expected to continue into next year."
Researcher Hwang said, "With the effect of the COVID-19 vaccine accelerating the recovery of gasoline and jet fuel, global demand for petroleum products is expected to increase by 2.5 to 3.5 million b/d (barrels per day)," adding, "On the other hand, the net increase in refining capacity is expected to be only 1.2 million b/d."
He explained, "The tight supply situation is expected to raise the Singapore refining margin from $3.7 per barrel this year to about $6.8 per barrel next year," and "Moreover, the additional cost of importing crude oil from the Middle East, the OSP, is also likely to turn negative."
He continued, "This year, the electric vehicle battery division was spun off into SK On, a 100% subsidiary, and next year, the battery sector will be re-evaluated due to two issues," referring to profitability turnaround and order backlog.
The expected performance for the battery division was presented as sales of 6.3 trillion KRW, operating profit of 113.4 billion KRW, and net profit of 119.5 billion KRW. This is because deliveries of relatively high-priced products for Volkswagen ID4 and Ford F-150 batteries will begin.
Hot Picks Today
"Stocks Are Not Taxed, but Annual Crypto Gains Over 2.5 Million Won to Be Taxed Next Year... Investors Push Back"
- "Don't Throw Away Coffee Grounds" Transformed into 'High-Grade Fuel' in Just 90 Seconds [Reading Science]
- Signed Without Viewing for 1.6 Billion Won... Jamsil and Seongbuk Jeonse Prices Jump 200 Million Won in a Month [Real Estate AtoZ]
- "Groups of 5 or More Now Restricted"... Unrelenting Running Craze Leaves Citizens and Police Exhausted
- "Even With a 90 Million Won Salary and Bonuses, It Doesn’t Feel Like Much"... A Latecomer Rookie Who Beat 70 to 1 Odds [Scientists Are Disappearing] ③
The order backlog is expected to rise to over 2.4 TWh (330 trillion KRW), reaching a global top level. It is projected to increase 4.3 times from 550 GW in 2020. Researcher Hwang Kyu-won mentioned, "Following the 129 GWh establishment plan by Ford in the U.S. in 2021, a large volume is also expected from the European Ford joint venture in 2022."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
