[Click eStock] Lotte Chemical Confirms Earnings Bottom... Target Price Lowered to 300,000 Won

[Asia Economy Reporter Hwang Yoon-joo] Hana Financial Investment maintained its 'Buy' rating on Lotte Chemical on the 9th, but lowered the target price from 360,000 KRW to 300,000 KRW following adjustments to the 2022 earnings estimates.

Yoon Jae-sung, a researcher at Hana Financial Investment, stated, "Operating profit for the first quarter of this year is expected to recover compared to the previous quarter, despite a 73% decrease year-on-year to 169.8 billion KRW," adding, "the regular maintenance opportunity loss that occurred last quarter will be eliminated, and inventory-related losses will also be reversed."

Researcher Yoon explained, "Considering the valuation (PBR 0.48x) that has fallen to financial crisis levels and the increasing possibility of a market rebound, as well as the visibility of expanding the secondary battery materials business, we judge this to be the true bottom of the stock price. Negative factors have already been sufficiently reflected in the stock price."

He analyzed, "It is highly likely that adjustments and integrations among battery material businesses such as aluminum foil and copper foil, which are dispersed across the entire group, will proceed as part of a long-term plan," adding, "In that process, Lotte Chemical, which has abundant financial capacity, will play a central role."

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