[Click eStock] "Subsidiary Value Fluctuation... POSCO Holdings, Target Price Down"

On the 15th, Eugene Investment & Securities downgraded the target price of POSCO Holdings by 6.5% to 440,000 KRW, stating that "the change in the value of subsidiaries was taken into account." The buy rating was maintained. The closing price on the previous day was 364,500 KRW.

On the same day, researcher Lee Yoo-jin of Eugene Investment & Securities stated, "Consolidated earnings for the third quarter of this year are expected to record sales of 18.7 trillion KRW and operating profit of 851.5 billion KRW (operating margin of 4.6%).

The researcher said, "The operating profit of the operating company POSCO is expected to increase by 38.3 billion KRW from the previous quarter to 456.7 billion KRW. Despite the decline in raw material prices, the average selling price (ASP) fell even more," adding, "Looking at the overlapping listed subsidiaries, except for POSCO International, similar or sluggish performance is expected. Due to the initial operation of lithium subsidiaries (Pilbara Lithium Solutions, POSCO Argentina), losses are anticipated in the eco-friendly future materials sector."

However, POSCO Holdings was recommended as the top preferred stock in the industry for gradual buying. Next year, the ban on expansion in China is expected to provide significant potential for stock price increase.

Researcher Lee said, "Following China's interest rate cuts and stimulus announcements, Chinese steel stocks have recently been strong," adding, "Especially with energy facility efficiency regulations and a ban on facility replacement making supply expansion impossible, if additional stimulus measures expected to be announced at this month's National People's Congress (NPC, equivalent to Korea's National Assembly) are implemented, infrastructure and government investment expansion could reduce imports from China."

He further noted, "However, there will likely be a lag of about two quarters before recent price increases in China are reflected in Korea," and added, "The secondary battery sector is also expected to see renewed growth due to changes in European policies, a decline in Tesla's share in the U.S., and a reduced risk of repeal of the Inflation Reduction Act (IRA)."

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