April 19, 2024

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[THE INVESTOR] GS Engineering and Construction will continue to post strong earnings in the second quarter, said Hana Financial Investment on July 4, maintaining a “buy” recommendation and 70,000 won (US$62.90) target price. 

Its revenue in the period will reach 3.17 trillion won and operating profit 202.7 billion won, estimated analyst Chae Sang-wook, forecasting that on the contract amount increasing since 2016 and the current level of profits likely to be maintained. 

Recent deterioration in the macro environment has hurt the construction industry as well, cutting back on the rise from North Korean momentum, but GS E&C has remained solid from an earnings surprise in the first quarter and rosy long-term outlook, said the analyst. 

Its second-quarter earnings will surge 136 percent on-year and its price-earnings ratio is as high as five times he added, suggesting a “top pick” rating.

By Hwang You-mee (glamazon@heraldcorp.com)