[Click eStock] "Korea Zinc, 2Q Operating Profit Increase... Nickel Refining Investment Expected in Second Half"

On the 3rd, NH Investment & Securities maintained a buy rating and a target price of 700,000 KRW for Korea Zinc, stating that despite the decline in zinc prices, operating profit increased due to price rises such as higher smelting charges (TC).

Korea Zinc's sales in the second quarter of this year recorded 2.469 trillion KRW, down 2.3% from the previous quarter, and operating profit increased by 6.8% to 156 billion KRW, in line with consensus estimates.

Lee Jae-kwang, a researcher at NH Investment & Securities, explained, "The current zinc price level of 2,500 USD is close to the marginal production cost of mines, so the price decline is limited, and prices are likely to rise if demand improves due to China's economic stimulus in the second half of the year." He added, "Normalization of annual production lines and increased production due to copper expansion are also expected."

He also said, "There is a plan to start construction of a nickel smelter in the second half of the year, but specific details have not been announced." He added, "Considering the nickel sulfate production capacity of the affiliate Kemco, a scale of 20,000 to 30,000 tons is expected, and applying the current nickel price, sales are projected to be around 600 billion to 900 billion KRW."

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