[Click eStock] "Kumho Petrochemical, Continued Shareholder Returns Raise Stock Revaluation Expectations"

Hyundai Motor Securities maintained its 'Buy' rating and a target price of 180,000 KRW for Kumho Petrochemical on the 8th, expecting a stock price revaluation as shareholder returns continue.

Kang Dong-jin, a researcher at Hyundai Motor Securities, said, "Although the industry recovery has not yet materialized, a stock price revaluation is expected due to continued shareholder returns," adding, "If there is additional treasury stock cancellation in the future, it will create an upside factor for the stock price."

Kumho Petrochemical announced plans to cancel 50% of its treasury shares held between 2024 and 2026 and additionally repurchase and cancel treasury shares worth 50 billion KRW. Researcher Kang stated, "Kumho Petrochemical continues shareholder returns through a dividend payout ratio of 20-25% of annual standalone net income and treasury stock repurchase and cancellation of 5-10% of net income, and the dividend per share (DPS) is expected to steadily improve due to the reduction in the number of shares," adding, "The possibility of additional treasury stock cancellation remains, and the annual net income shareholder return rate of 35% is also positive."

Although the industry is sluggish, it is expected to maintain stable performance. Researcher Kang forecasted, "Despite the overall weakness in the chemical industry, Kumho Petrochemical is recording the most stable profits among chemical companies, with operating profit exceeding 300 billion KRW even in the worst industry conditions," and "It is expected to record stable profits at a level similar to last year this year as well."

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