[Click eStock] Vinatek Forecasts Record High Operating Profit in 2022... Target Price Down

[Asia Economy Reporter Hwang Yoon-joo] Shinhan Financial Investment maintained a 'Buy' rating on Vinatek on the 15th, expecting the company to record its highest-ever performance this year. However, reflecting a downward adjustment in the EV/EBITDA multiple, the target price was lowered to 60,000 KRW.

Choi Kyu-heon, a researcher at Shinhan Financial Investment, stated, "Sales in 2022 are expected to reach 71.8 billion KRW (+47% YoY), and operating profit is projected at 9.4 billion KRW (+65%), marking an all-time high."

Researcher Choi analyzed, "The core business scale will achieve 63.2 billion KRW (+49%) due to full-year reflection of new products and AGV volumes, along with additional volumes from the recovery of existing application demand," adding, "The new business scale is expected to be 6.1 billion KRW (+64%)."

He noted, "With secured volumes for S-Fuelcell (approximately 5 billion KRW), additional new orders (such as Doosan Fuel Cell) are anticipated."

Researcher Choi forecasted, "Despite proactive capacity expansion in anticipation of front-end industry growth, the scale is rapidly increasing, leading to a growing operating leverage effect for two consecutive years this year and next, with operating profit margins of 13% and 17% respectively (compared to 12% in December 2021)."

He added, "There are also short-term upward momentum factors such as the passage of the hydrogen law amendment bill currently pending in the National Assembly and new hydrogen fuel cell orders in the second half of the year."

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