S&P ups Posco view to positive

Standard & Poor's said it revised the outlook on its long-term corporate credit rating on Korea-based Posco to positive from stable on expectations that the company will be able to continue generating strong profit margins and cash flow despite recent price cuts and the continuing trend in soft steel prices.

At the same time, S&P affirmed its A- long-term corporate credit and debt ratings on the company.

S&P said the A- rating on Posco reflects the company's continued leading market position in Korea, pricing power in the domestic market, diversified end markets and strong balance sheet and cost competitiveness; factors that enable it to generate healthy cash flows even during market downturns.

At the same time, S&P said the rating takes into account the industry's current high procurement costs and Posco's aggressive expansion strategy, which includes plans to invest $12 billion in India over the next decade.

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