[Click eStock] "Myeongshin Industry, High Growth Next Year... Overhang Is a Burden" ... Hyundai Motor Securities

[Asia Economy Reporter Park So-yeon] Hyundai Motor Securities stated on the 6th that Myungshin Industry "possesses high growth potential and a stable profit structure" and "is expected to continue high growth next year."

Myungshin Industry is a specialized manufacturer of body parts based on hot stamping. As of the third quarter of this year, the sales ratio by customer is 54.9% from leading U.S. electric vehicle (EV) companies and 45.1% from Hyundai Motor Group. Jang Moon-soo, a researcher at Hyundai Motor Securities, said, "As the U.S. EV companies plan an average annual global sales growth of 50%, Myungshin Industry is expected to grow alongside them, leading to improved performance."

According to consensus estimates, the expected sales and operating profit for 2022 are 1.41 trillion KRW and 123 billion KRW, respectively, projecting high growth rates of 27% and 32%. It is anticipated that sales will increase due to price linkage with raw material fluctuations and a high automation rate, with a clear operating leverage effect.

Researcher Jang noted, "However, the burden of overhang shares will be a factor weighing on the stock price increase." The major shareholder shares subject to additional lock-up release in December and the overhang shares amounting to 8.5% based on the third-quarter report are analyzed as factors hindering stock price growth.