Kiwoom Securities evaluated on the 8th that Kumho Petrochemical's operating profit in the third quarter of this year was 625.3 billion won, up 192.5% from the same period last year, exceeding the market expectation (572.9 billion won).
General-purpose rubber and phenol derivatives maintained solid profitability, and Kumho Polychem was added to consolidated earnings from 3Q. It is analyzed that this is because the energy sector's performance improved at the same time as the SMP rose.
The investment opinion remained 'buy'and the target price remained at 310,000 won, respectively.
Kiwoom Securities said, “The synthetic rubber division’s operating profit was 222.5 billion won, up 147.8% from the same period last year”.
Kiwoom Securities continued, "The operating profit of the phenol derivatives division was 267.2 billion won, up 288.9% from the same period last year. Although the profitability of phenol and acetone was somewhat sluggish, it was due to the re-increase in the price of BPA and epoxy resin."
Kumho Petrochemical recorded an operating profit of 29.7 billion won in the EPDM and TPV business, turning to the black on a large scale compared to the same period last year.
Kiwoom Securities said, “This is due to the improvement in spreads due to strong product demand and weak ethylene and propylene prices amid continued supply tightness. It is attributable to increased profits in the energy sector due to limited regular maintenance and maintenance.”
Considering Kumho Petrochemical's separate dividend payout guidance, the dividend yield based on the current share price is projected to exceed 7%.
Kiwoom Securities said, “The average export price in the third quarter was $4741 per ton, up 4.4% from the previous quarter and 116.4% from the same period last year.”
Reporter Lee Dong-hoon usinvestmentidea2020@gmail.com
