S&P Global Ratings revised its outlook on Posco Holdings (KRX:005490) and subsidiaries Posco and Posco International (KRX:047050) to negative from stable, while affirming their respective long-term issuer credit ratings at A- and BBB+.

The negative outlook reflects the potential credit impact of oversupply problems in the steel industry as well as Posco Holdings' weak electric vehicle (EV) battery material segment and increased debt burden, S&P said in a Thursday release.

Uncertainties regarding US steel tariffs and end-market demand offset potential improvements in the company's profitability, the rating agency said.

Posco Holdings' substantial capital investments, particularly in EV battery materials, will limit the improvement in its leverage, keeping adjusted debt-to-EBITDA ratio above 1.5x over the next one to two years.

However, asset sales and possible anti-dumping moves in Korea could balance some of the risks, S&P said.

Notable shifts in the company's profitability and cash flow levels may trigger future rating actions, according to S&P.