POSCO Holdings likely to fall short of third-quarter earnings consensus; target price cut

[Financial News] Hanwha Investment & Securities maintained its "Buy" rating on POSCO Holdings on the 29th despite forecasting weak earnings, while cutting its target price from KRW 550,000 to KRW 500,000.
Hanwha Investment & Securities forecast POSCO Holdings' consolidated operating profit for the third quarter at KRW 748.3 billion, 8.7% below the consensus estimate.
Jiwoo Kwon, an analyst at Hanwha Investment & Securities, said, "POSCO's operating profit is expected to rise 31.9% from the previous quarter to KRW 361.1 billion," adding, "Although selling price increases following anti-dumping measures are outpacing higher raw material costs, the improvement is likely to be limited by lower exchange rates."
Kwon added, "Battery materials are expected to post an operating loss of KRW 45.6 billion," explaining, "The salt lake in Argentina is expected to remain around break-even due to maintenance, while Posco Pilbara Lithium Solution (PPLS) is likely to see its loss widen as it uses high-cost concentrate inventories."
Consolidated operating profit is expected to reach KRW 707.5 billion in the fourth quarter. The decline in POSCO's earnings is expected to be partially offset by improvements in lithium.
Kwon noted, "Selling prices and utilization rates are expected to improve in the fourth quarter," adding, "There is room for lithium's value to be upgraded if sales of certified products increase and Phase 1 utilization reaches 90%."

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