SK Gas will return to normal as propane gas price stabilizes, said Cape Investment and Securities on Nov. 29 suggesting a “buy” recommendation and 100,000 won (US$89.10) target price.
The price has surged for a while and become stable, which also will help boost its propane dehydrogenation business and affiliate SK Advanced. Profits from liquefied petroleum gas trading will normalize even as the US raises natural gas production and oil prices decline, said analyst Cheon Yu-jin.
Meanwhile, its coal-powered generation plant in Goseong and LPG/LNG combined-cycle power plant in Dangjin will begin operations in 2021 and 2024, respectively. SK will be able to expand into power generation market and strengthen stability in profits, she added.