Hana Financial Investment said on the 22nd that it expects SeAh Steel's operating performance to improve significantly this year, maintaining its "buy" investment opinion and target stock price of 160,000 won.
"The return on equity (ROE) is expected to reach 14.7% this year due to the recovery of U.S. exports of energy steel pipes and the expansion of domestic product spread," Hana Financial Investment said. "However, the current stock price is too undervalued as it is only three times the stock price return (PER) and 0.4 times the share price net asset ratio (PBR).".
From the second half of next year, offshore wind power orders and the momentum for easing steel import regulations in the U.S. are still valid. In the third quarter of this year, SeAH Steel's sales are expected to increase 20.2% year-on-year to 335.7 billion won and operating profit to 32.9 billion won, up 87.1%.
"It will not be too much for Seah Steel to achieve 260,000 tons, the annual export quota for energy steel pipes bound for the U.S., this year.
Its operating profit is expected to reach 40.9 billion won in the fourth quarter due to a recovery in sales due to the expansion of working days," Hana Financial Investment said.
Reporter Lee Dong-hoon usinvestmentidea2020@gmail.com
