[THE INVESTOR] KCC’s operating profit in the second half of this year has declined, but it will recover on the back of its paint sector, said BNK Investment and Securities on Dec. 31 lowering the target price to 380,000 won (US$341.57) from 430,000 won.
Its operating profit fell 18.9 percent on-year reflecting unfavorable environment where deteriorating construction market has cut down demand while prices of main materials have risen, said analyst Lee Seon-il.
Next year is more promising, however, as industrial paint division will pick up in earnest led by those for vessels. Construction materials will face a declining front industry but its flagship products gypsum boards and plate glasses will remain stable. The recent oil price drop is likely to bring down and stabilize raw material prices, forecast the analyst, adding that the company’s operating profit for 2019 will gain 12.3 percent from this year to 310.7 billion won.
By Hwang You-mee (firstname.lastname@example.org)