[Click eStock] "KMW, Stock Slump Won't Last Long... August Peak Expected"

Hana Financial Investment Report
Record High Stock Prices Expected in the Second Half
Low Likelihood of Capital Increase, CB, BW Issuance Becoming Reality

[Asia Economy Reporter Minji Lee] Hana Financial Investment maintained its buy rating and target price of 100,000 KRW for KMw on the 24th. This is because it is expected to record the highest-ever performance in the second half of the year based on strong second-quarter earnings expectations and export achievements.

Hong-sik Kim, a researcher at Hana Financial Investment, said, "Although I mentioned the possibility of a correction during May and June, the reason the stock price consolidation period is longer than expected is mainly because earnings have not yet supported it," adding, "We should focus on quarterly earnings forecasts for this year rather than the year-over-year operating profit growth rate in the first half."

Operating profit is expected to double each quarter from the first to the fourth quarter. Although the stock price is sluggish, considering that the export market is beginning to bloom in earnest, KMw is expected to show the most notable earnings trend among domestic 5G network equipment companies.

China and Japan have already started 5G CAPEX, and the US and India are also expected to begin investments within this year. Currently, KMw is showing strong sales toward ZTE, and through Nokia, Samsung, Ericsson, and Fujitsu, it is expected to achieve favorable results in Japan, the US, and India in the second half of the year.

Researcher Hong-sik Kim said, "In the past, KMw had a strong presence in the US and Japanese markets," adding, "Although the sales proportion from Nokia has increased based on the domestic market, significant benefits are expected in the second half due to Samsung Electronics' rising market share."

Some investors are concerned about KMw's recent rights offering and the issuance of CB and BW, but the likelihood of these materializing is low. Researcher Hong-sik Kim assessed, "Some bonds have been refinanced, and the current cash holdings amount to 100 billion KRW," adding, "From the major shareholder's perspective, the burden of a rights offering is high, so it will not be a card to use for at least several years."

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