Korean Inc. expected to keep up robust rebound momentum in H2

[Graphics by Song Ji-yoon]

Earnings of Korean companies are projected increase nearly 50 percent in the third quarter and over 70 percent in the final three months of the year against a year-ago period, although slowed from the first half, latest consensus showed.

According to Korean financial data provider FnGuide Inc. on Thursday, 246 listed companies with a consensus compiled by three or more brokerage houses are projected to raise 59.6 trillion won ($50.2 billion) in combined operating income in the third quarter ending September, up 48.78 percent from the same period a year ago.

The estimate is lower than the 118.33 percent on-year growth in the first quarter and 91.03 percent in the second quarter but the gain is still over 50 percent.

The analysis showed that the operating income projection of 230 companies was 5.48 percent higher than the earlier estimate of 55.5 trillion won as of the end of June.

FnGuide analysis showed that companies in economy-sensitive sectors such as steel, shipping, and petrochemical that were hit hard by the Covid-19 pandemic last year and those in aviation and leisure industries would report substantial improvement in earnings in the latter half.

Korean steelmaker Posco is projected to raise 2.3 trillion won in operating income in the third quarter, up 253.8 percent from a year ago, and Hyundai Steel and HMM up 1,860.6 percent and 546.5 percent, respectively. S-Oil, SK Innovation, Korean Air Lines, Hotel Shilla, and Kangwon Land are expected to swing to profit.

Among blue chip stocks, market bellwether Samsung Electronics is also projected to raise 15.6 trillion won in operating income, up 25.8 percent from a year ago.

SK hynix¡¯s operating income is forecast to see 213.7 percent growth, Samsung Biologics 128.3 percent, and Kia Motors 581.3 percent. Hyundai Motor is also expected to raise 1.7 trillion won in profit.

Among growth stocks, LG Chem is projected to raise 39.8 percent higher operating profit, Samsung SDI 30.7 percent, and Naver 15.9 percent. Kakao, which has been in the center of controversy over its mushrooming business throughout all sectors, is forecast to report more-than-doubled operating income on year to 242 billion won.

FnGuide also presented a rosy outlook for Korean Inc.¡¯s fourth quarter income.

The 246 listed companies are expected to raise a combined 54.06 trillion won in operating income in the October-December period, up 71.85 percent from a year ago. The growth projection of 225 companies, in particular, was 3.58 percent higher than the earlier outlook in the end of June.

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