JPM-JPM Mining Daily Iron ore 百分之1.2, Spodumene -百分之1.8...-20251125

Solid credits at less demanding valuation; OW SKH, LGES and POSCO

Korean IG corporates have seen mixed credit rating trends in recent years subject to theiroperational performance and capex intensity. Despite elevated borrowing costs, Korean IGsupply has risen to ~US$14bn/year since 2023 as corporates ramp up their overseasinvestments. The abundant supply has kept spreads relatively wide vs historical levels,providing relative value for their ratings. Among Korean IG, we are OW on three names thatoffer 4.5%-5% yield: (1) SK Hynix ‘31s/‘33s as robust AI-driven CF growth will likely turnthe company to net cash by 2026E; (2) LGES belly/long-end as decreasing US investmentsand robust ESS shipment growth drive deleveraging; and (3) POSCO (PKX ‘30s/‘35s,POHANG ‘33s) as the company should be able to maintain an A- rating (S&P) withdecreasing capex and improving operations.