Steel inventories bought at higher prices. HUPSteel was the first industrial hardware company to be listed on the SGX main board in 1994. To date, HUPSteel has more than 60 years of history as a supplier and stockist of quality industrial products and services for the oil and gas, chemical, petrochemical, energy, infrastructure and marine industries. The effect of falling steel prices should be monitored closely, as HUPSteel would have inevitably bought steel stocks when steel prices were still peaking a few months back. With faltering demand for steel products expected going forward, we worry that HUPSteel would have to sell its stocks at lower
average selling prices, thinning its profit margins.

Softening demand for steel products. Customers are adopting caution, buying only enough steel for immediate needs. Although HUPSteel’s product prices are largely holding up at the moment, SGX expect selling prices to fall soon.

Initiate with Hold recommendation and target price S$0.19. SGX initiate coverage of the stock with a HOLD recommendation and target price of S$0.19