[Click eStock] "Hyosung Heavy Industries, Discount Rate Expected to Decrease Compared to Competitors... Target Price Up"

Shinhan Investment Corp. raised the target price for Hyosung Heavy Industries on the 27th, maintaining a 'Buy' rating, citing expectations of a reduced discount compared to competitors.

Researcher Dongheon Lee stated, "On February 23, Hyosung Group announced a spin-off through a corporate split, which appears to be a step toward affiliate separation," adding, "Hyosung Heavy Industries will belong to the surviving holding company along with Hyosung TNC and Hyosung Chemical."

Lee explained, "Currently, the shares of Hyosung Heavy Industries are held by Hyosung Corporation at 32.47%, Honorary Chairman Cho Jock-rae at 10.55%, Chairman Cho Hyun-joon at 5.84%, and Vice Chairman Cho Hyun-sang at 4.88%," and assessed, "To complete the split, share succession and swaps are necessary, so it will take time until the governance changes are finalized, and there is no immediate change in corporate value."

He added, "On the same day, the appointment of Woo Tae-hee as an inside director was proposed; according to media reports, the newly appointed Woo Tae-hee is Vice Chairman of the Korea Chamber of Commerce and Industry and has experience as the 2nd Vice Minister of the Ministry of Trade, Industry and Energy, handling energy policies such as nuclear power and hydrogen," expressing expectations for expansion in hydrogen charging stations, liquefied hydrogen plants, energy storage systems (ESS), and wind power businesses.

Overall industrial sentiment has also increased. Lee said, "Hyosung Heavy Industries' U.S. plant is expected to stabilize, turn profitable, and grow significantly with an increase in order backlog," noting, "Although the heavy industry sector underperformed competitors in the fourth quarter, there is no fundamental evidence to explain a competitive disadvantage. Performance improvement is expected in the first quarter due to the reflection of delayed orders." He also analyzed that the construction division's risk is limited as it focuses on contracting and profitability.

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