Market: KOSPI (005490)
Brokerage : Hanwha Investment & Securities
Analyst : Jiwoo Kwon
Investment Rating : Buy (Maintained)
Target Price : 550,000 KRW (Maintained)
Core Momentum : Despite short-term 2Q cost pressures, structural earnings recovery is projected to continue supported by 3Q steel roll-margin expansion, 2H Argentina lithium ramp-up, and formalized shareholder return and stake monetization roadmaps.
📊 1. [Valuation & Key Financial Metrics]
- Rating & Target Price: Maintained Buy rating with a target price of 550,000 KRW (maintained), offering a 71.1% upside potential from the current share price of 321,500 KRW.
- Key Valuation Multiples:
- 2026F: P/E 15.6x, P/B 0.4x, EV/EBITDA 5.3x, Dividend Yield 3.4%, ROE 2.7%, EPS 20,568 KRW
- 2027F: P/E 11.8x, P/B 0.4x, EV/EBITDA 4.7x, Dividend Yield 3.4%, ROE 3.5%, EPS 27,166 KRW
- Annual Financial Forecasts:
- 2026F: Revenue of 71.33T KRW, Operating Profit of 2.96T KRW, EBITDA of 7.77T KRW, Controlling Net Profit of 1.56T KRW, Net Debt of 15.98T KRW
- 2027F: Revenue of 73.35T KRW, Operating Profit of 4.01T KRW, EBITDA of 9.49T KRW, Controlling Net Profit of 2.05T KRW, Net Debt of 19.45T KRW
🚀 2. [Market Opportunities & Business Outlook]
- 2Q26 Earnings Preview:
- Consolidated revenue is estimated at 18.00T KRW (+2.5% YoY, +0.7% QoQ) and operating profit at 687.9B KRW (+13.3% YoY, -2.7% QoQ), missing consensus by approximately 9%.
- Steel: ASP increases since March were offset by raw material cost inflation (strengthening USD and coking coal). Steel division operating profit projected at 371.2B KRW (+7.6% QoQ) with POSCO standalone at 236.5B KRW (+8.0% QoQ). Spreads are expected to expand slightly in 3Q on automotive steel contract price hikes and volume growth.
- Battery Materials: Operating loss estimated at 2.5B KRW. POSCO Argentina is expected to exceed BEP following monthly turnaround in March, whereas PPLS is projected to remain in the red due to high spodumene input costs and the base effect of fading inventory valuation gain reversals.
- Infrastructure: POSCO International is expected to drive operating profit to 399.2B KRW (+68.4% YoY), with POSCO E&C sustaining positive earnings at 21.3B KRW.
- Shareholder Return & Capital Strategy (CID):
- Total shareholder return ratio targeted at 35–40% of adjusted controlling net profit.
- Monetization and optimization policy established for excess stakes in listed subsidiaries.
📝 Editor’s Comment (Perspective)
The analyst views POSCO Holdings as an enterprise navigating a transient operational cost squeeze while preserving a solid mid-term turnaround trajectory, underpinned by progressive spread expansion in core steel, upcoming lithium utilization scaling, and clear capital allocation frameworks. This perspective prioritizes the structural commercialization of Argentine lithium assets and the execution of formalized total shareholder return policies (35–40% payout) over short-term quarterly margin pressure.
To verify whether this investment thesis continues to materialize, investors should monitor the realization of steel spread expansion through automotive sheet price adjustments in 3Q, the pace of utilization ramp-up and ASP improvements at POSCO Argentina following low-price contract expirations in 2H, and the tangible execution of the 35–40% shareholder return framework alongside listed subsidiary stake monetization. These developments can be tracked through upcoming quarterly earnings releases, official IR presentations, and regulatory filings.
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Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
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