In the commodity report published by HSBC, it was pointed out that the outlook of some Turkish steel companies improved with the recovering global demand.
HSBC said the global steel demand outlook was under pressure for much of the second half of 2022 by high energy prices and weakening global macro factors, which eased as the demand outlook in the US remained strong and China experienced a recovery.
HSBC noted that the earthquake in February hit a third of Turkey's steel production and caused supply problems. The bank predicted that Erdemir's Iskenderun facility was affected and that it would take the second quarter of 2023 to resume operations.
However, it was stated that the demand that will arise for the construction of the regions hit by the earthquake and the regions that need to be renewed will lead to gradually higher steel prices in the steel figures, while Erdemir will have problems in the short term due to its closed factory.
Target prices updated upwards
The report highlighted positive catalysts in steel prices and the demand outlook, which will help recover from the weak demand outlook in the fourth quarter.
HSBC kept its 'Hold' recommendation for Erdemir and updated its target price from 32 TL to 45 TL.
For Kardemir, he changed the 'Hold' recommendation to 'Buy' and increased its target price from 13 TL to 25 TL.
While the bank stated that the general situation seemed positive for all players, it was evaluated that Erdemir would have a more positive outlook in the second quarter of 2023.
Comments
No comment yet.