Moody's Upgrades Hyundai Steel Credit Rating from 'Baa3 to Baa2'... "Will Maintain Profitability"

[Asia Economy Reporter Gong Byung-sun] The international credit rating agency Moody's has upgraded Hyundai Steel's credit rating. Despite the slowdown in the steel industry, Hyundai Steel is expected to maintain a robust level of profitability.

On the 17th, Moody's announced that it had upgraded Hyundai Steel's corporate credit rating from 'Baa3' to 'Baa2'. The rating outlook was maintained as 'stable'.

Moody's stated, "Although Hyundai Steel's profits are expected to slow down over the next 1 to 2 years compared to last year due to the steel industry's downturn, they will still maintain a fairly robust level. The ability to pass on raw material price increases to selling prices has improved compared to the past, and the restructuring of underperforming business sectors in recent years has also contributed to maintaining profitability."

Furthermore, Moody's said, "A significant portion of the free cash flow will be used to reduce borrowings. Considering Hyundai Steel's solid cash flow, moderate capital expenditures, and dividend payments, it is expected to generate a substantial level of free cash flow over the next 1 to 2 years." It also evaluated that Hyundai Steel has the capacity to sell non-core assets for further debt reduction.

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