[Click eStock] "POSCO, No Holding Company Discount... Stock Price Moves Alongside Steel Prices"

[Asia Economy Reporter Ji Yeon-jin] Kiwoom Securities predicted that the future stock price of POSCO Holdings, the holding company of POSCO which was converted to a listed company from the 2nd, will follow Chinese steel prices.

Researcher Lee Jong-hyung of Kiwoom Securities said, "Changing to POSCO Holdings does not change the corporate value, and since the value of the core subsidiary POSCO is determined by the steel industry conditions, the stock price of POSCO Holdings is also expected to follow Chinese steel prices," adding, "In the long term, the secondary battery material business such as lithium and nickel is expected to increase corporate value."

From this day, POSCO Holdings, the holding company, takes over the listing, and the newly established business company POSCO, split the day before, remains unlisted. Among the subsidiaries previously held by POSCO, only four subsidiaries including POSCO Gangpan (listed) and POSCO M-Tech (listed) are succeeded to the newly established POSCO, becoming grandchild companies, and all other subsidiaries except these four become subsidiaries of POSCO Holdings. Overseas steel subsidiaries such as Indonesia PTKP and China Zhangjiagang STS are expected to move to the newly established POSCO as subsidiaries, becoming grandchild companies of POSCO Holdings.

The researcher said, "In the domestic stock market, holding companies are generally traded at a 50-60% discount compared to net asset value (NAV) due to double counting issues from the listing of core subsidiaries," but added, "However, in the case of POSCO Holdings, since the core subsidiary POSCO remains unlisted with 100% ownership, the usual holding company valuation cannot be applied."

Meanwhile, the newly established POSCO recorded a net profit of 5.2 trillion KRW on a separate basis last year, and its total equity as of the end of the third quarter last year was 27.8 trillion KRW, with a return on equity (ROE) expected to approach 20% this year.

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