[Click eStock] Mando, Promising Third Quarter

[Asia Economy Reporter Hwang Junho] Korea Investment & Securities announced on the 16th that although Mando's stock price has significantly declined since last month, it maintains the target price for Mando at 82,000 KRW.

Jinwoo Kim, a researcher at Korea Investment & Securities, analyzed the recent decline in Mando's stock price, stating, "Considering that the damage caused by the lockdown in China in the second quarter has been smoothly recovering in the third quarter, this is an unexpected trend," and added, "The recent weakness is due to the increased relative preference for parts companies with a large U.S. share following the U.S. IRA agreement."

However, he forecasted that the third-quarter performance this year will show a recovery trend. He expected sales to reach 1.8 trillion KRW and operating profit to be 70.2 billion KRW, in line with consensus. He cited the recovery in Chinese automobile sales, normalization of production by U.S. electric vehicle companies, and strong sales of Hyundai and Kia vehicles as reasons. He also viewed the favorable movement of the KRW-USD exchange rate compared to the previous quarter positively.

Researcher Kim stated, "We maintain Mando as the top preferred parts company stock," and predicted, "In the short term, benefits are expected from the rebound in Chinese automobile sales, and in the mid to long term, benefits are also anticipated from increased automobile production in the U.S. due to the U.S. Inflation Reduction Act."