[Click eStock] "Hyundai Motor Strengthens Global Status... Target Price Up"

Target Price Raised from 310,000 Won to 350,000 Won

On the 14th, NH Investment & Securities raised the target price for Hyundai Motor Company from 310,000 KRW to 350,000 KRW, anticipating that the strengthening of the brand's prestige will lead to an increase in valuation. The investment rating was maintained at 'Buy.'

Researcher Jo Suhong of NH Investment & Securities stated, "The new target price applies a 30% discount rate, which is a 10% reduction compared to the previous rate. We expect the Hyundai Motor brand's prestige to be enhanced through global collaborations aimed at increasing mid- to long-term business potential. As collaboration results become visible and the global competitive landscape is reshaped, the stock discount rate may gradually decrease." He added, "If the discount rate is completely removed, the theoretical target price could be adjusted upward to approximately 500,000 KRW."

NH Investment & Securities forecasts Hyundai Motor's Q3 earnings this year to show a 3.8% increase in sales to 42.5412 trillion KRW compared to the same period last year, and a 4.5% rise in operating profit to 3.992 trillion KRW. Researcher Jo analyzed, "In addition to the impact of global demand slowdown, factors affecting Q3 profitability include the effects of wage and collective bargaining agreements (such as strikes leading to reduced domestic plant operating rates and reflected wage increases). Also, due to the decline in the year-end exchange rate, the reversal of sales warranty provisions is expected to be significant." He further explained, "The Q3 operating margin is expected to be 9.4%, similar to Q2, but the adjusted operating margin excluding sales warranty provisions is 10.5%, the lowest level within the quarter."

The profit resilience is expected to be maintained. Researcher Jo said, "Although the slowdown in industry momentum is inevitable, the possibility of mid- to long-term valuation increase (discount rate reduction) due to brand prestige enhancement is a greater positive factor. From a performance perspective, Hyundai Motor is expected to maintain solid profit resilience (sufficient cash for future technology investment and shareholder returns)."

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