[Click eStock] "Dong-A Hwasung, Expected Growth in Green New Deal Including Electric & Hydrogen Vehicles, Hydrogen Fuel Cells"

[Asia Economy Reporter Hyunseok Yoo] KB Securities analyzed on the 18th that Dong-A Hwasung's growth potential in green new deal items such as electric vehicles, hydrogen vehicles, and hydrogen fuel cell businesses is attractive. No investment opinion or target price was presented.

KB Securities forecasted that the products held by Dong-A Hwasung will highlight growth potential in the green new deal. Researcher Sang-guk Lim of KB Securities said, "Battery pack gaskets for electric vehicles are currently supplied to Hyundai Motor, US GM, China’s First Automobile Works, and Great Wall Motors," adding, "The portfolio of eco-friendly rubber products such as intake and exhaust hoses for hydrogen vehicles and integrated gaskets for hydrogen fuel cell stack bipolar plates is excellent."

Researcher Lim particularly emphasized the subsidiary Dong-A Fuel Cell. He said, "Dong-A Fuel Cell is developing a 5kW-class high-temperature polymer electrolyte membrane fuel cell (HT-PEMFC) system and is preparing for KC and KS certifications," adding, "It has secured world-class fuel cell stack electrical efficiency (54%)."

He stated, "Currently, there are nine overseas production subsidiaries, and the operating rate of the Chinese subsidiary, which was sluggish in the first quarter, is greatly improving from the second quarter," emphasizing, "For the US and India second plants, production yield is expected to increase in the latter half of the year, and the full-scale mass production of battery injection parts for North American automobiles in the fourth quarter is also expected to be a positive momentum."

Dong-A Hwasung’s sales in the second quarter were 43.8 billion KRW, down 36.6% compared to the same period last year. It also recorded an operating loss of 1.1 billion KRW. He explained, "Both sales and operating profit were sluggish due to the direct impact of the novel coronavirus infection (COVID-19)," adding, "Thanks to the recent resumption of economic activities and the recovery of the Chinese subsidiary’s operating rate, profit normalization is expected to accelerate toward the second half of the year."

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