52% Discount Compared to Hyundai Motor... Kia Also Aims for 100 Trillion Won Market Cap [Click eStock]

Growth Prospects in Both Automotive and Robotics Sectors

There are projections that Kia's market capitalization could exceed 100 trillion won. Like Hyundai Motor, Kia is engaged in both the automotive and robotics industries, but analysts believe that the discount rate applied to Kia compared to Hyundai Motor is excessive, suggesting there is ample room for further growth.

On the 21st, Daishin Securities raised Kia's target share price by 16.7% to 260,000 won based on this analysis. The previous day's closing price was 149,400 won. The investment opinion of "Buy" was also maintained.

Daishin Securities projected Kia's target market capitalization at 103 trillion won. It estimated the value of the core automotive business at 80 trillion won and set the value of the robotics industry at 19 trillion won. The value of the Software-Defined Vehicle (SDV) business was assessed at 3 trillion won.

Because Hyundai Motor is leading the group's robotics and other physical artificial intelligence (AI) industries, a discount is inevitable. However, the current discount rate of 52% is considered excessive. As Hyundai Motor has entered the corporate value premium range, continued valuation alignment could lead to Kia's share price rising.

Daishin Securities analysts Kim Guiyeon and Park Seoyoung explained, "We applied a 30% discount rate to the equity value of the robotics industry, considering the lower leadership and shareholding ratio in the Boston Dynamics (BD) business compared to Hyundai Motor." They added, "Given Kia's solid fundamentals, with an expected operating profit of 10 trillion won and an operating margin of 8% this year, the company's valuation is attractive."

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