PKX - Steelmaker Posco surges on bets for demand recovery

2023-04-10 12:10:48 ET

Posco Holdings ( NYSE: PKX ) +9.2% to a 52-week high in Monday's trading on rising hopes for a recovery in steel demand and future growth in its battery material business.

Shares of the South Korean steelmaker surged 7.8% on the Korea Stock Exchange to close at 398,500 won, outperforming the benchmark Kospi's 0.9% gain.

Posco's ( PKX ) recent rally likely reflects growing market expectations that China's steel demand could rebound from this year's H2, Hyundai Motor Securities analyst H.W. Park said Friday, citing a new order index for China's steel sector that rose in March to above 50% for the first time since May 2020.

The company also could get a strong valuation boost from its expanding battery material business, including its lithium supply affiliate, Park said, maintaining his Buy rating.

Posco ( PKX ) is widely expected to return to a Q1 profit as it recovers from flood damage losses .

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