[Click eStock] "HL Holdings, Undervalued with High Dividend Appeal... Target Price Up"

Target Price Raised from 45,000 Won to 50,000 Won

Daol Investment & Securities on the 3rd viewed HL Holdings as being in an absolutely undervalued state and raised the target stock price from the previous 45,000 KRW to 50,000 KRW. The investment opinion was maintained as 'Buy.'

Yoo Ji-woong, a researcher at Daol Investment & Securities, explained, "The intrinsic business value was recalculated at 278.9 billion KRW, and the equity value of HL Mando alone corresponds to about 381 billion KRW (with a 40% discount), which has not been reflected in HL Holdings' current stock price," adding, "The dividend yield is attractive at 6.4%, and it is judged to be in an absolutely undervalued state."

Daol Investment & Securities cited the rebound in HL Mando's corporate value and the revaluation of intrinsic business value as investment points for HL Holdings. Researcher Yoo said, "In the case of HL Mando, the possibility of a favorable trend in the Chinese business has recently emerged, and the stock price is being rapidly revalued as it is expected to exceed the annual operating profit margin guidance of 4.0%. HL Holdings, unlike typical holding companies, has the characteristic of actively conducting its own business."

HL Holdings' intrinsic business generates annual sales of about 1.1 trillion KRW, and an operating profit margin of about 2.2% is expected this year. Researcher Yoo explained, "A rapid recovery is expected starting from the first quarter of this year, and the operating profit margin is expected to reach around 4% by 2027, so reflecting this value recovery is necessary."

HL Holdings' intrinsic business is largely composed of aftermarket, logistics, modules, fleet, and other businesses. Among the aftermarket segment, the European subsidiary accounts for about 50%, and from the second half of last year to the first quarter of this year, margin losses occurred due to conflicts in the Israel region and economic sanctions on Russia. Researcher Yoo forecasted, "From the second quarter of this year, margin normalization will begin due to increased sales in Africa and the establishment effects of joint ventures (JVs) in Mexico and India."

Revaluation of growth potential is expected in the module sector, with sales of 273.9 billion KRW anticipated this year. Researcher Yoo said, "The module sector is expected to achieve sales of 391.5 billion KRW by 2027 due to the exclusive supply effect of the U.S. company T within the United States," adding, "FleetOn, a comprehensive used car reconditioning complex, is expected to grow alongside the rapid expansion of the domestic used car rental market, with double-digit growth expected annually."

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