Hyundai Motor Securities Q3 Operating Profit 40.5 Billion KRW...25% Decrease YoY

[Asia Economy Reporter Park Jihwan] Hyundai Motor Securities continued its stable growth by recording an operating profit of over 40 billion KRW for three consecutive quarters for the first time since its launch, thanks to the strong performance of its core business, the Investment Banking (IB) division, despite the sluggish securities market in the third quarter of this year.

On the 28th, Hyundai Motor Securities announced through its preliminary earnings disclosure (fair disclosure) that its consolidated operating profit for the third quarter of 2021 was 40.5 billion KRW, and net profit was 30 billion KRW. These figures represent decreases of 25% and 26%, respectively, compared to the same period last year.

The cumulative results for the third quarter showed an operating profit of 140 billion KRW and a net profit of 102.5 billion KRW, both increasing by more than 9% compared to the same period last year. Hyundai Motor Securities, which opened the era of operating profits exceeding 100 billion KRW for the first time last year, is expected to surpass an annual operating profit of 150 billion KRW within a year by generating stable earnings each quarter.

Although there was a base effect causing a decline compared to the previous year due to one-time gains recorded in the third quarter of last year, which resulted in the highest quarterly operating profit (54.4 billion KRW) in history, the recent performance is considered commendable given the current market conditions.

In particular, the third quarter of this year saw the stock market decline for three consecutive months for the first time since the COVID-19-induced market crash, along with reduced trading volumes and interest rate hikes, leading to continued weak performance issues across the securities industry. Nevertheless, the IB division led stable growth by recording net operating income exceeding 37 billion KRW for three consecutive quarters. In the third quarter, proactive focus on expanding high-quality alternative investments such as logistics centers and maintenance projects, including investment in the Songdo H Logistics Center and participation in the Cheongju Express Bus Terminal development project, aligned with market trends, proved effective.

Hyundai Motor Securities stated, "As the box range market is expected to continue in the fourth quarter and the possibility of additional interest rate cuts remains, which may not be favorable, we will continue our growth by securing asset soundness through thorough risk management and stable earnings."