[Click eStock] "Hyundai Corporation Expected to Recover Pre-Pandemic Performance Levels This Year"

[Asia Economy Reporter Lee Jung-yoon] Hana Financial Investment maintained its buy rating and target price of 25,000 KRW for Hyundai Corporation on the 19th, stating that the first quarter of this year is expected to confirm growth in major business sectors and improvement in profit margins.

Hyundai Corporation's sales for the first quarter of this year are projected to reach 1.2 trillion KRW, a 62.8% increase compared to the previous year. Yoo Jae-sun, a researcher at Hana Financial Investment, explained, "Significant growth is expected in sectors such as steel and petrochemicals due to rising raw material prices," adding, "Demand for steel products has increased as geopolitical risks have emerged in Eastern Europe and supply chain disruptions have occurred."

Additionally, petrochemicals are expected to see increased sales due to price hikes. In the case of passenger car parts, steady growth is anticipated based on increased orders despite production delays at automakers, and machinery and shipbuilding are expected to recover in scale due to improved sales performance in emerging markets. Hyundai Corporation's operating profit for the first quarter is forecasted to be 12.9 billion KRW, an 84.2% increase year-on-year, with an operating margin of 1.1%. The high margins in the steel sector appear to be driving the improvement in profit margins.

Researcher Yoo stated, "Given the fast pace of sales growth due to last year's performance base and the absence of any significant factors damaging profit margins, this year's performance is expected to recover to pre-pandemic levels," adding, "If new business expansions materialize within the year, additional performance growth can also be anticipated."