Hyundai Motor and Kia Ahead of Earnings Announcement "Expecting Solid Performance"

Earnings Report Expected as Early as Next Week
Securities Industry "Anticipates Remarkable Performance in Second Half"

[Asia Economy Reporter Kiho Sung] Ahead of Hyundai Motor and Kia's earnings announcements, the industry is expecting solid performance. Securities firms forecast that Hyundai and Kia's Q2 earnings will significantly exceed consensus estimates, and foreign media have highlighted Hyundai's 'Ioniq 5' and Kia's 'EV6' as electric vehicles to watch in the U.S.

According to industry sources on the 17th, Hyundai and Kia are expected to begin their earnings announcements as early as next week.

The securities industry is showing high expectations for this earnings report. DB Financial Investment stated about Hyundai Motor, "We expect remarkable earnings to continue in the second half of the year, and even assuming the worst, the current stock price is undervalued." The investment opinion was 'Buy,' with a target price maintained at 270,000 KRW.

DB Financial Investment projected Hyundai Motor's Q2 revenue to increase by 11% year-over-year to 33.6742 trillion KRW, and operating profit to rise by 38% to 2.6052 trillion KRW, surpassing market expectations (consensus: 2.2477 trillion KRW).

Korea Investment & Securities forecast Kia's Q2 operating profit at 2.2474 trillion KRW, exceeding consensus by 29%. Kia recorded a record high operating profit of 1.6 trillion KRW in Q1 this year, making it highly likely to break this record again in Q2.

This strong performance is attributed largely to the effects of exchange rates and incentive reductions. Accordingly, Korea Investment & Securities maintained a 'Buy' rating for Hyundai and Kia, setting target prices at 260,000 KRW and 135,000 KRW, respectively. Samsung Securities also maintained 'Buy' ratings for Hyundai and Kia, with target prices of 260,000 KRW and 120,000 KRW, respectively.

Hyundai Motor's achievement of four consecutive years of labor negotiations without disputes for the first time in history also brightens the outlook. Hyundai Motor's labor union reached a tentative agreement on wage negotiations on the 12th, including a 98,000 KRW increase this year.

Kim Pyeongmo, a researcher at DB Financial Investment, said, "Although stock prices have been sluggish due to renewed emissions-related controversies in Europe, the stock is excessively undervalued even considering the worst-case scenario. Negative factors such as rising incentives and increased costs are offset by increased sales volume, and earnings improvement is expected to continue through the second half of the year."

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