[Click e-Stock] Spandex Upcycle Continues for Hyosung TNC... Target Price Raised

Positive Outlook on Sharp Improvement in Spandex Market
"Buy" Rating Maintained

On April 28, NH Investment & Securities raised its target price for Hyosung TNC from 620,000 won to 730,000 won, citing the continued upcycle in the spandex market.

Choi Youngkwang, a researcher at NH Investment & Securities, stated, "The price of spandex continues to rise on the back of improved supply-demand balance." He explained, "As of April 17, the price per ton was 28,500 yuan, up 23.9% from the beginning of the year and 9.6% from the end of March."

Choi said, "Reflecting the sharp improvement in the spandex industry, we have raised this year's operating profit forecast by 15.6% compared to the previous estimate," and projected, "Tight supply-demand conditions are expected to persist through next year, with continued strength in both prices and spreads."

He noted, "While most companies in the sector are expected to see a slowdown in performance from the second quarter due to lower operating rates and the impact of reverse lagging, Hyosung TNC is expected to increase spandex sales volumes in the second and third quarters." He added, "The company is projected to deliver differentiated performance improvement driven by price increases and other factors."

Choi emphasized, "Second quarter operating profit is expected to reach 129.4 billion won, up 50% from the first quarter, with an operating margin of 5.8%." He added, "Spandex prices are surging, and nylon and polyester are also expected to narrow operating losses on the back of price increases."

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