"TPG's Acquisition of Lotte Rental Raises Hopes for Improved Shareholder Value" [Click eStock]

Hyundai Motor Securities raises target price from 46,000 won to
59,000 won

Hyundai Motor Securities maintained its Buy rating on Lotte Rental on Oct. 22 and raised its target price to 59,000 won from 46,000 won.

“The current share price reflects expectations of improved shareholder value following the change in the largest shareholder,” said Jang Moon-soo, an analyst at Hyundai Motor Securities.

Analyst Jung expected Lotte Rental to appoint two directors nominated by Texas Pacific Group (TPG), the global private equity firm that acquired the company, after its extraordinary general meeting on Oct. 30, and to complete the change-of-control process, including payment of the acquisition price. “We expect the company to strengthen its long-term management and shareholder return strategies afterward,” he said.

He added that the current share price reflects expectations for stronger shareholder returns and operating strategies following the completion of TPG’s sole acquisition of the company. In particular, he said uncertainty over operating and shareholder return strategies is expected to gradually ease after TPG’s acquisition. “While challenges in responding to industry conditions remain, including fading expectations for interest rate cuts and the shift of used-car exports bound for the Middle East to retail and rental channels, the effects of efforts to strengthen the core business ahead of a sale—including expanding the business and reducing costs to improve earnings—are expected to continue,” Analyst Jung said.

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