[Click eStock] "Korea Gas Corporation, Continued Mid- to Long-Term Optimism"

Engaged in the entire hydrogen production process... Recently increasing receivables are a concern
Hyundai Motor Securities "Korea Gas Corporation target price raised from 42,000 KRW to 50,000 KRW"

[Asia Economy Reporter Gong Byung-sun] Korea Gas Corporation recorded its highest third-quarter performance since 2018 this year, thanks to improvements in its overseas business results. Although accounts receivable have recently increased, securities analysts say there is still optimism from a mid- to long-term perspective.

According to Hyundai Motor Securities on the 24th, Korea Gas Corporation's sales for the third quarter of this year increased by 58.53% year-on-year to 5.3728 trillion KRW, and operating profit turned positive to 7.8 billion KRW during the same period. This sales figure exceeded the market consensus forecast by 17.48%.

The strong performance of overseas businesses influenced the results. The combined operating profit of overseas projects such as Gladstone Liquefied Natural Gas (GLNG), Prelude, Jubail, and Myanmar was close to 100 billion KRW. Considering gas prices trailing crude oil prices and OPEC's gradual production increase policy, overseas business operating profits are expected to continue strong performance until the first quarter of next year.

From the fourth quarter of next year, production, liquefaction, and storage plants (FLNG) in Mozambique are also expected to start production. Kang Dong-jin, a researcher at Hyundai Motor Securities, explained, "Mozambique is initially linked to the Northeast Asia spot price (JKM) and later reflects crude oil prices," adding, "The volume contributed by overseas businesses is continuously increasing."

Expectations from a long-term perspective are also valid. The company is expected to engage in key businesses in the production process such as hydrogen introduction, production, and utilization. In particular, it plans to build 17.1 gigawatts (GW) of overseas renewable energy facilities by 2030 and to introduce and sell green hydrogen.

Accordingly, Hyundai Motor Securities maintained its investment opinion of "Buy" on Korea Gas Corporation. The target stock price was raised from the previous 42,000 KRW to 50,000 KRW.

However, although crude oil prices have recently risen, accounts receivable caused by delayed tariff increases remain a concern. Researcher Kang said, "The increase in accounts receivable is a negative factor," but added, "At least the accounts receivable are likely to be collected, even if it takes a long time in the future."

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