[Featured Stock] SeAH Steel Holdings Hits 52-Week Low... Stock Drops Amid Weak Steel Pipe Market

Continued Decline with 52-Week Low Recorded
Concerns over Global Market Conditions and US Inventory Issues
Strong Q2 Performance Affected by Provisions

SeAH Steel recorded a 52-week low. It appears to have been affected by the sluggish global steel pipe industry.

As of 10:16 AM on the 22nd, SeAH Steel is trading at 116,500 KRW, down 0.60% (700 KRW) from the previous day. This is below the 52-week low of 116,700 KRW recorded on the 13th. SeAH Steel's stock price, which started this year at 137,600 KRW, has been continuously declining sharply.

Researcher Lee Yoo-jin of Eugene Investment & Securities said, "While an increase in hydrocarbon energy investment following Trump's election could be seen as positive for SeAH Steel, the activities of resource development companies are not limited to policies alone," adding, "According to the Dallas Fed Energy Survey as of June, resource development companies and oilfield service providers responded that additional production would be difficult due to mergers and acquisitions and increased drilling costs." The researcher added, "Domestic steel pipe inventory in the U.S. is expected to have a greater impact on the industry, and since domestic steel pipes are largely for construction, earnings forecasts are expected to remain low for the time being."

SeAH Steel posted sales of 439.5 billion KRW and an operating profit of 36 billion KRW in the second quarter. Although the performance was good, it was analyzed that the impact of provisions was significant. It was noted that the reversal of provisions for damages related to collusion by Korea Gas Corporation appeared as a selling and administrative expense reversal. Excluding the provisions, the results are evaluated to be in line with the consensus (market average forecast).

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