1. What’s Happening at Korea Steel?
Korea Steel’s H1 2025 revenue decreased by 23.90% year-on-year to KRW 238.488 billion. The company reported an operating loss of KRW 13.15 billion and a net loss of KRW 6.43 billion. Q2 results also fell short of market expectations, signaling a potential prolonged downturn.
2. What’s Driving the Decline?
The main factors contributing to this decline are the construction market downturn and falling rebar prices. Korea Steel’s single-business structure, focused on rebar, makes it vulnerable to industry fluctuations, and its market share has been steadily declining. Raw material price volatility, exchange rate fluctuations, and high interest rates are also adding pressure on profitability.
3. What’s the Outlook?
Unless the current macroeconomic and industry environment improves, Korea Steel’s poor performance is likely to continue. The rising debt-to-equity ratio and declining equity threaten financial stability and increase vulnerability to external shocks. Despite efforts to diversify, short-term improvements are unlikely.
4. What Should Investors Do?
Investors should be fully aware of Korea Steel’s significant fundamental deterioration and make cautious investment decisions. Carefully consider the company’s business restructuring efforts, profitability strategies, and plans for future growth, while fully acknowledging the associated risks. A long-term perspective focusing on the company’s transformation is crucial, rather than expecting a short-term rebound.