[Click eStock] "Hyosung TNC Expected to Benefit from Spandex Due to Consumer Sentiment Recovery"

[Asia Economy Reporter Kwangho Lee] Shinhan Investment Corp. analyzed on the 13th that although Hyosung TNC has been on a downward trend since the beginning of the year, the recovery of consumer sentiment is expected to increase spandex demand, leading to potential improvement in business conditions. The investment opinion 'Buy' and the target price of 430,000 KRW were maintained.

Jinmyung Lee, Senior Researcher at Shinhan Investment Corp., explained, "The global spandex market has been in a downcycle since the record boom in 2021 due to China's zero-COVID policy and large-scale capacity expansions."

He added, "However, since the low point in the third quarter of this year, expectations for China's reopening have rapidly spread, raising hopes for business condition improvements in 2023."

He stated, "The operating rate rose to 81% in October, and inventory days have rapidly decreased. The price of Chinese spandex increased by 10% month-on-month due to sales recovery driven by improved demand."

Lee forecasted, "Hyosung TNC, as a vertically integrated company, is unlikely to adjust its operating rate and is expected to maintain higher selling prices compared to competitors."

He also expressed optimism, saying, "A gradual recovery is expected from the third quarter low this year, and stock price revaluation is likely to continue."