[Click e-Stock] "HD Hyundai, Value Stock Reappraisal Amid Concentration Trend"

BNK Securities Sets Target Price of 350,000 Won for HD Hyundai

On June 24, BNK Securities initiated coverage of HD Hyundai with a target price of 350,000 won and a 'Buy' recommendation, citing improved performance from its major subsidiaries and expanded shareholder returns as positive factors.

On a standalone basis, HD Hyundai’s sales in the first quarter of this year reached 373 billion won, up 33.6% from the same period last year. This was mainly due to dividend income amounting to 338 billion won, a 35.2% year-on-year increase. Operating profit came in at 353 billion won (+35.4% YoY), and net profit was 336 billion won (+28.5% YoY).

Jangwon Kim, analyst at BNK Securities, stated, "Subsidiaries' quarterly dividends have increased, and with new subsidiaries beginning to pay dividends, the outlook is even brighter," adding, "Consolidated results should remain strong, underpinned by favorable conditions at core subsidiaries and high-quality order intake."

BNK Securities projects HD Hyundai’s full-year consolidated results to be 79.551 trillion won in sales, 8.699 trillion won in operating profit, and 2.381 trillion won in net profit. Consolidated results reflect subsidiary performance through either full consolidation or the equity method. For HD Hyundai, most of its major subsidiaries are fully consolidated, with their sales included directly in the group’s top line.

Kim further explained, "Dividends from subsidiaries are the result of consolidated performance, and the dividends received by the holding company from its subsidiaries form the basis of its standalone results. Therefore, improving consolidated results raise expectations for next year’s standalone performance."

He added, "While it remains uncertain whether Hyundai Oilbank, which is highly sensitive to oil price fluctuations, will sustain its strong first-quarter results, other subsidiaries are expected to continue delivering solid performance thanks to quality orders and productivity improvements. As a result, the dividend pool will increase, further enhancing the holding company’s standalone results and its capacity to pay dividends."

HD Hyundai’s subsidiaries include HD Korea Shipbuilding & Offshore Engineering, HD Hyundai Marine Solution, HD Hyundai Electric, HD Hyundai Heavy Industries, and HD Hyundai Marine, among others.

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