[Click eStock] "Hyundai Marine & Fire, Upward Outlook This Year... Target Price Up"

NH Investment & Securities announced on the 16th that it has raised the target price for Hyundai Marine & Fire Insurance from 40,000 KRW to 42,000 KRW due to revised earnings forecasts. The investment rating was maintained at 'Buy.'

Researcher Jeong Jun-seop stated, "Hyundai Marine & Fire Insurance is expected to normalize the gap between actual and expected results, with one-time gains added, leading to a separate net profit of 1.213 trillion KRW in 2024, a 50.5% increase compared to the previous year. The dividend per share (DPS), applying a 20% payout ratio for 2023, is 3,100 KRW, resulting in a dividend yield of 9.1%."

He added, "The price-to-book ratio (PBR) is only 0.41 times, making its valuation more attractive compared to competitors. However, the dividend capacity has become tighter than before."

He further explained, "Although net profit increased due to the reversal of large loss contract costs in the first quarter, the reserve for policyholder dividends also surged significantly. Under the current formula for distributable profits, it has become more difficult to expect an expansion of the payout ratio or the establishment of a mid- to long-term shareholder return policy."

He continued, "The fortunate point is that government authorities are reviewing changes to the calculation standards for insurance companies' reserve for policyholder dividends. While corporate taxes may temporarily increase if the calculation standards change, distributable profits will improve significantly, which is positive from a shareholder return perspective."

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