Kia Accelerates with Both HEVs and EVs [Click e-Stock]

Record First-Quarter Sales
Solid Fundamentals Despite War-Driven Uncertainty

Kia's electric vehicles (EVs) and hybrid electric vehicles (HEVs) are performing well in Europe and the United States, respectively. Amid growing uncertainty in downstream demand due to conflicts such as the Iran–US–Israel war, there are forecasts that Kia's solid fundamentals compared to competitors will become more prominent.

On April 14, LS Securities maintained its target price for Kia at 190,000 won and its 'Buy' investment rating, citing these factors. The previous day's closing price was 147,400 won.

For the first quarter of this year, Kia is expected to post sales of 30.315 trillion won and operating profit of 2.21 trillion won. These figures represent increases of 8.2% and 7.3%, respectively, compared to the same period last year.

Global wholesale sales in the first quarter reached 779,169 units, up 0.8% year-on-year and marking the highest first-quarter figure ever. Notably, EV sales surged, particularly in Europe, with around 87,000 units sold—a 62.8% increase year-on-year. The launch of new models such as the EV5 and EV3 in Europe contributed to an increase of approximately 10,000 units in sales volumes.

HEV sales also continued to perform strongly. Led by the U.S. market, sales grew by 36.4% year-on-year, driving overall results. With the full-scale launch of the second-generation Telluride, sales are expected to continue trending upward. If the Telluride achieves its sales target of 180,000 units, the impact on profit and loss is projected to be 1 trillion won.

A rising exchange rate generally favors revenue growth and improved profitability. However, in the first quarter, the increase in the year-end exchange rate is expected to result in an additional expense of approximately 200 billion won, due to the revaluation of the sales warranty provision at the year-end rate.

Byungkeun Lee, a researcher at LS Securities, stated, "The current share price is trading at a 12-month forward price-to-earnings ratio (PER) of 6.7 times and a price-to-book ratio (PBR) of 0.9 times. At a time when demand is uncertain due to war risks, Kia's solid fundamentals compared to competitors will lead to a revaluation of its corporate value. Furthermore, if Kia participates in equity investments in humanoid manufacturing in the future, it will be revalued as a robotics company, which could narrow the valuation gap with Hyundai Motor Company."

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