[Click eStock] "Hyundai Elevator, Favorable Growth Environment... Next Year Will Be Better"

[Asia Economy Reporter Ji-hwan Park] Daishin Securities maintained a 'Buy' rating and a target price of 62,000 KRW on Hyundai Elevator on the 25th, stating that a favorable growth environment will continue, leading to sustained performance improvement.

Researcher Dongheon Lee of Daishin Securities analyzed, "The exemption regulation for maintenance and precision safety inspections, with a three-year time lag, is leading to increased demand for essential parts," adding, "Since the strengthening of the Elevator Safety Management Act in 2019, demand for parts and remodeling has increased."

With the Chungju plant, which cost 320 billion KRW, scheduled to begin operations in March next year, efficiency gains from logistics center integration are also expected. Additionally, the completion of the advanced Shanghai plant targeting the Chinese domestic market has doubled production capacity (CAPA) from 7,000 units last year to 15,000 units.

Performance improvements of subsidiaries are also expected to continue. Researcher Lee said, "Subsidiaries such as Hyundai L&L (recovery in Banyan Tree Hotel reopening demand), Hyundai Asan (increase in domestic construction sales), and Hyundai Economic Research Institute (expansion of online business) are expected to see improved performance."

On the other hand, although it is difficult to estimate the timing of performance reflection for the price increase implemented since July, gradual price increases are considered to have passed the peak of cost burden.

Researcher Lee stated, "From the fourth quarter of this year, deferred performance will be reflected, installation will benefit from the recovery of upstream industries, and maintenance will benefit from strengthened regulations," adding, "A favorable growth environment is expected."

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