[Click e-Stock] "Nexen Tire, Tire Sales Increase... Forecast Upgraded"

KB Securities Report

On the 26th, KB Securities raised its operating profit forecasts for Nexen Tire for this year and next year due to an increase in tire sales in the first quarter. The investment rating was maintained as Buy, and the target price was raised to 8,900 KRW.

Kang Sung-jin, a researcher at KB Securities, stated, "Nexen Tire's operating loss is expected to turn into a profit by 2025, shifting from a deficit of 54.3 billion KRW last year," and analyzed, "The main reason for the improvement in operating profit over the next three years is the increase in tire sales."

Researcher Kang mentioned, "Tire production at the Czech plant, where the second phase of expansion will be completed next year, is expected to double compared to last year," and added, "Production at the Changnyeong, Yangsan, and China plants is also expected to recover to the pre-pandemic level of 2019."

He said, "Operating profit this year is expected to turn positive at 148.2 billion KRW," and added, "The improvement in profitability, along with the increase in tire sales, is the main reason for the forecasted increase in Nexen Tire's operating profit."

He also added, "While variable costs per unit are expected to decrease by 15.6% year-on-year due to lower raw material prices and freight costs, the average selling price (ASP) is expected to decline by only 5.3% due to the relatively tight supply and demand in the tire market."

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