[THE INVESTOR] Concerns over the one-off costs that might have dragged down the fourth-quarter earnings of POSCO have cleared, said NH Investment and Securities on Dec. 12, maintaining a “buy” recommendation and 430,000 won (US$394.71) target price.
The steelmaker could have been forced to reflect over 400 billion won including operation rights of its subsidiary POSCO Energy’s coal-fired power generation business in Samcheok, Gangwon Province, had the government’s plan to disallow building coal thermal power generators been ratified, said analyst Byeon Jong-man.
The subsidiary’s fuel cell business will be maintained at the current level as well, clearing worries over possible suspension of business, noted the analyst.
Meanwhile, steel prices will remain strong until February 2018 boosted by China’s official reduction in operation rates of furnaces and steel manufacturing since mid-November, he added.
By Hwang You-mee (email@example.com)