[Click eStock] "POSCO Holdings, 3Q Earnings Slowdown... Target Price Down"

Shinhan Investment Corp. slightly lowered the target price for POSCO Holdings from 710,000 KRW to 700,000 KRW on the 11th. However, the investment rating was maintained at 'Buy.'

POSCO Holdings is estimated to record sales of 20.2 trillion KRW and an operating profit of 1.13 trillion KRW in the third quarter. This slightly underperforms market expectations. Although prices of key raw materials such as iron ore and coking coal declined during the second quarter, the drop in average selling price (ASP) was greater, negatively impacting earnings.

In the fourth quarter, steel shipments are expected to recover to normal levels, leading to an improvement in spreads due to price increases. Steelmakers in China, which have been unprofitable, are voluntarily reducing production, causing a decline in crude steel output in China. Supply-demand improvements, along with price hikes and overall industry profitability enhancements, are expected by the end of this year. The market expectation for fourth-quarter operating profit is 1.37 trillion KRW.

Park Kwang-rae, a researcher at Shinhan Investment Corp., stated, "With the start of commercial lithium production at the end of 2023, renewed attention on the company's new business is expected, leading to a rebound in the stock price."

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