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[Alpha Biz=(Chicago) Reporter Paul Lee] NH Investment & Securities has maintained its investment opinion in LG Chem as "buying" and lowered its target stock price from 610,000 won to 580,000 won. Considering the improvement of the business portfolio from petrochemicals to secondary batteries, it was suggested that stock prices are in the undervalued area.
"LG Chem's sales in the fourth quarter of last year will be 13.5 trillion won and operating profit will be 276.5 billion won, far below market expectations," NH Investment & Securities said on the 16th. "The petrochemical sector will record 97.1 billion won in operating losses due to falling spread and negative logging."
"The high-tech materials sector is expected to turn into a deficit, accompanied by the selling price of anode materials and falling volume," said NH Investment & Securities. "The energy solution will be only 338.2 billion won due to a decrease in profits due to the selling price and falling operation rate despite the recognition of 250.1 billion won in AMPC (tax credit)."
"The company will lower its overall earnings forecast to reflect falling prices across the overall value chain of secondary batteries and weak petrochemical spread, and lower its operating profit forecast for this year and next year by 16% and 6%, respectively," NH Investment & Securities said. "LG Chem's stock price trend is relatively sluggish, but the current stock price is 1 times below the historic band's lowest point this year."
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
