"POSCO International Acquires U.S. Gas Field... Opportunity to Strengthen Business Capabilities" [Click e-Stock]

Samsung Securities Sets Target Price of 80,000 Won for POSCO International

On September 16, Samsung Securities announced that it is initiating coverage on POSCO International, which has decided to acquire a stake in a U.S. gas field, viewing this as an opportunity to strengthen its energy business capabilities. The securities firm set a new target price of 80,000 won and a "Buy" investment rating.

Recently, POSCO International decided to invest approximately 750 billion won to acquire a stake in a gas field located in Marcellus, operated by U.S.-based Code Energy. This is a strategic investment aimed at strengthening its liquefied natural gas (LNG) value chain, enabling the company to secure gas production capacity of 1 million tons. Going forward, roughly 20% of the procured volume will be converted to LNG for utilization.

Jaeseung Baek, a research analyst at Samsung Securities, stated, "Supported by the securing of LNG-dedicated carriers, expansion of the Gwangyang LNG terminal, and establishment of an LNG trading subsidiary in Singapore, we expect POSCO International to enhance its midstream (transportation, storage, and distribution) capabilities by expanding its LNG trading volume. In particular, this acquisition presents a positive opportunity for genuine integration of the LNG value chain."

POSCO International plans to expand its gas field sales volume from 2.58 million tons in 2025 to 4.2 million tons in 2031, and its LNG trading volume from 1.82 million tons in 2025 to 6.35 million tons in 2031.

Shinhan Securities commented, "The company anticipates an annual gas field operating profit of around 10 billion won from 2028 onward, but we plan to reflect these earnings estimates once more details have been confirmed." The report added, "Nonetheless, considering not only the POSCO Group but also broader shifts in the energy industry, securing energy sources is likely to become increasingly important. From this perspective, the acquisition can be positively evaluated for its impact on corporate value."

It continued, "Although there is an overhang issue due to the largest shareholder, POSCO Holdings, deciding to sell a 20% stake in the company through a price return swap (PRS) contract, the average price-to-earnings (P/E) valuation of global LNG-related peers stands at approximately 14.8 times, and the company's current P/E of 10.4 times does not constitute a significant burden."

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