By Shinhye Kang
Sept. 18 (Bloomberg) -- Korea Gas Corp., the world's biggest buyer of liquefied natural gas, rose the most in more than four months in Seoul trading on speculation parliament will approve a $4 billion plan to cover energy companies' losses.
The shares rose as much as 5.82 percent, or 3,600 won, to 65,500 won, the most since May 8, and traded at 64,800 won as of 11:02 a.m. local time. The Kospi index dropped 2.3 percent.
Lawmakers from the ruling and opposition parties agreed yesterday to pass a 4.57 trillion-won supplementary budget to help cover the losses of state-owned energy companies caused by government controls on fuel prices. The National Assembly will approve the bill today, Korea Economic Daily reported.
``The extra budget will ease concerns over the cash-flow of Korea Gas,'' Joo Ick Chan, an analyst at Hana Daetoo Securities Co., said in a report today. He maintained a `buy' rating on the stock with a price target of 100,000 won.
The extra budget includes a plan to provide state-run energy companies with 1.3 trillion won in subsidies. The government has capped gas prices since November last year to ease inflation that has reached a 10-year high.
The state-run utility must issue 5.6 trillion won of corporate bonds by the year-end to cover rising costs, acting Chief Executive Lee Byung Ho told parliament on Sept. 9.
To contact the reporter on this story: Shinhye Kang in Seoul at skang24@bloomberg.net.
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