Market: KOSPI (005490)
Brokerage : Shinhan Securities
Analyst : Gwang-rae Park, Seunghun Han
Investment Rating : BUY (Maintained)
Target Price : 440,000 KRW (Maintained)
Core Momentum : Strong earnings from infrastructure subsidiaries, combined with narrowing battery materials losses via rising lithium prices and higher utilization at the Argentine facility, are projected to drive a gradual recovery across steel and non-steel businesses.
📊 1. [Valuation & Key Financial Metrics]
- Rating & Target Price: Maintained BUY rating with a target price of 440,000 KRW (maintained), offering a 26.1% upside potential from the current share price of 349,000 KRW.
- Key Valuation Multiples:
- 2026F: P/E 16.1x, P/B 0.5x, EV/EBITDA 6.5x, Dividend Yield (DY) 2.9%, ROE 3.1%
- 2027F: P/E 13.0x, P/B 0.5x, EV/EBITDA 6.0x, Dividend Yield (DY) 2.9%, ROE 3.7%
- 2028F: P/E 11.6x, P/B 0.5x, EV/EBITDA 5.6x, Dividend Yield (DY) 2.9%, ROE 4.1%
- Annual Financial Forecasts:
- 2026F: Revenue of 71.61T KRW, Operating Profit of 3.16T KRW (+73.1% YoY), Controlling Net Profit of 1.73T KRW
- 2027F: Revenue of 74.19T KRW, Operating Profit of 3.66T KRW, Controlling Net Profit of 2.13T KRW
- 2028F: Revenue of 76.42T KRW, Operating Profit of 4.22T KRW, Controlling Net Profit of 2.39T KRW
🚀 2. [Market Opportunities & Business Outlook]
- 1Q26 Earnings Preview:
- Consolidated operating profit is estimated at 588.6B KRW (+4,542% QoQ), meeting market consensus (599.0B KRW).
- Steel Segment: Standalone sales volume estimated in the low-8M ton range. Raw material input costs rose over 20,000 KRW/ton due to high coking coal and FX appreciation, keeping standalone operating profit flat at 334.9B KRW (-0.0% QoQ). Meaningful profit improvements are expected from 2Q as March price hikes take effect.
- Infrastructure Segment: POSCO International is expected to deliver over 300.0B KRW (+16.5% QoQ) in operating profit, supported by the full-year contribution of the Senex expansion and higher oil prices benefiting the Myanmar gas field. POSCO E&C is projected to reach BEP in 1Q.
- Battery Materials Segment: Operating losses are expected to narrow, driven by rising lithium prices and higher operating rates at the Argentine lithium plant.
- Key Catalysts & Policy Trends:
- Corporate pricing initiatives and stronger trade policy actions against low-priced steel imports will provide upward momentum for ASP.
- Turnaround momentum in battery materials is expected to outweigh potential moderation in the upcoming revised dividend policy.
📝 Editor’s Comment (Perspective)
The analyst views POSCO Holdings as an integrated materials and infrastructure holding company effectively defending its operational earnings trough through resilient non-steel subsidiaries, while setting the stage for synchronized recovery across steel price realizations and lithium loss narrowing. This perspective places higher significance on the upcoming 2Q steel margin inflection and the structural normalization path of Argentine lithium assets over temporary 1Q input cost inflation.
To verify whether this investment thesis continues to materialize, investors should monitor the realization of steel roll-margin expansion in 2Q following the implementation of March price hikes, the pace of loss contraction and progress toward breakeven at the Argentine lithium facility, and the details of the upcoming new shareholder return (dividend) framework. These developments can be tracked through upcoming quarterly earnings releases, official IR presentations, and regulatory filings.
📢 Disclaimer & Source
Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
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