[Click eStock] Hyundai Glovis with Cost Competitiveness, Growth Expectations Up Despite COVID-19

Limited Impact from COVID-19... Does Not Undermine Cost Competitiveness
Potential to Grow as Global No.1 in PCC Industry

[Asia Economy Reporter Minwoo Lee] Logistics specialist Hyundai Glovis is expected to achieve mid- to long-term growth based on cost competitiveness in its finished vehicle ocean transport (PCC) business division.

On the 26th, NH Investment & Securities gave Hyundai Glovis a 'Buy' rating with a target price of 200,000 KRW.

Hyundai Glovis has grown into the world's second-largest PCC company with a fleet of 90 vessels as of the end of last year. Its relatively young fleet results in higher fuel efficiency compared to competitors, and it can secure relatively stable multi-stop transport volumes compared to European shipowners, leading to high loading rates. Jeong Yeonseung, a researcher at NH Investment & Securities, stated, "Despite lower unit prices compared to competitors, Hyundai Glovis can secure sufficiently high profitability and has signed transport contracts with non-affiliated European finished vehicle companies, improving loading rates and profitability. It is expected to grow into the world's number one PCC company."

Although there are adverse effects from the COVID-19 pandemic, these are considered short-term. In the first quarter, performance may be somewhat sluggish due to disruptions in finished vehicle production by affiliates and shipments to China, but the cost competitiveness of the PCC business will not disappear. Researcher Jeong said, "There are concerns about decreased CKD (completely knocked down) sales due to reduced operating rates at European factories caused by emission regulations, but this can be offset by expanded production at Kia's India plant this year and Hyundai's entry into Indonesia next year. The company is also actively considering fleet expansion and mergers and acquisitions (M&A) of logistics companies, enabling organic growth."

This content was produced with the assistance of AI translation services.